U.S. PIRG, April 2013
We are submitting testimony in support of Minnesota legislation (S.F. 1237/H.F. 1440) to decouple from the federal tax code so as to prevent companies that abuse offshore tax havens from shifting their tax burden onto ordinary Minnesotans.… Continue reading »
David Cooper, Doug Hall, Economic Policy Institute, Briefing Paper #357, March 13, 2013
By highlighting the need to increase the federal minimum wage in his State of the Union address, President Obama breathed new life into a critically important issue. Wages for U.S. workers, particularly low-wage workers, have eroded not just in recent years, but over several decades (Mishel 2013; McNichol et al. 2012). This erosion has contributed to the growth of income inequality, leaving the economy less vibrant than if incomes were distributed more evenly. Raising the minimum wage and incorporating a system for automatic adjustment over time is key to reversing this erosion of low-wage workers’ earnings, and would help combat growth of income inequality.… Continue reading »
J. Paul Leigh, working economics: the Economic Policy Institute Blog, March 6, 2013
New research in economics suggests that raising the minimum wage will improve the health of many Americans, especially those with low income, and this improvement should help bend the cost curve for medical care.… Continue reading »
National Employment Law Project/Cry Wolf Project, March 2013
In her Congressional testimony from 1959, Eleanor Roosevelt noted the repetitive quality of objections raised by minimum wage opponents over the previous five decades. More than 50 years later, it appears that nothing has changed.
This report documents the rhetorical onslaught launched by minimum wage opponents over the past 100 years. Rather than approaching these claims at face value, we step back and review how minimum wage opponents have presented their case through roughly a century’s worth of public statements, congressional testimonies, editorials, media interviews, and other public records, devoting a critical eye to the trajectory of these criticisms over time.… Continue reading »
Citizens for Tax Justice, March 2013
In recent years, multinational U.S.-based corporations have systematically accumulated
staggering amounts of profits offshore. Much if not most of these profits were actually earned in the United States but have been artificially shifted to foreign tax havens to avoid U.S. corporate income taxes. Taking a look at the 10 most aggressive corporations.… Continue reading »
Pew Research Center/USA TODAY Survey, February 21, 2013
After a series of fiscal crises over the past few years, the public is not expressing a particular sense of urgency over the pending March 1 sequester deadline. With little more than a week to go, barely a quarter have heard a lot about the scheduled cuts, while about as many have heard nothing at all.
And if the president and Congress cannot reach a deficit reduction agreement before the deadline, 40% of Americans say it would be better to let the automatic spending cuts go into effect, while 49% say it would be better to delay the cuts. Both Republicans and independents are divided evenly over which approach is better, and even among Democrats, roughly a third favor letting the sequester take effect over any delays.… Continue reading »
Lawrence Mishel, Economic Policy Institute, Issue Brief #351 February 21, 2013
As is well-documented in The State of Working America, 12th Edition (Mishel et al. 2012), the U.S. economy has worked primarily to the advantage of a small sliver of winners.Meanwhile, the vast majority of workers have not fared well—a trend that stretches back to the 1970s.
Between 1973 and 2011, the median worker’s real hourly compensation (which includes wages and benefits) rose just 10.7 percent. Most of this growth occurred in the late 1990s wage boom, and once the boom subsided by 2002 and 2003, real wages and compensation stagnated for most workers—college graduates and high school graduates alike. This has made the last decade a “lost decade” for wage growth. The last decade has also been characterized by increased wage inequality between workers at the top and those at the middle and bottom, and by the continued divergence between overall productivity and the wages or compensation of the typical worker. This divergence has been demonstrated anew in the current recovery over 2009–2011 as real wages fell for the bottom ninety percent of the wage distribution but rose for the top five percent (Mishel and Finio 2013).… Continue reading »
Aaron Sojourner, working economics: the Economic Policy Institute Blog, February 20, 2013
Both advocates and opponents talk a lot about how a minimum wage increase would affect Americans who are trying to find jobs. For the first time, we have insight into what job seekers themselves think about minimum-wage issues, thanks to newly-released data from the American National Election Survey.
The majority of job seekers report that raising the minimum wage to keep pace with the cost of living would be good for them personally. In fact, ten times as many job seekers report that minimum-wage increases would be good for their lives (66.5 percent) than report that it would be bad for their lives (6.5 percent). By a seven-to-one margin, they think it would be good (71.0 percent), rather than bad (10.1 percent), for America overall.… Continue reading »
John Schmitt, Center for Economic and Policy Research, February 2013
The employment effect of the minimum wage is one of the most studied topics in all of economics. This report examines the most recent wave of this research – roughly since 2000 – to determine the best current estimates of the impact of increases in the minimum wage on the employment prospects of low-wage workers. The weight of that evidence points to little or no employment response to modest increases in the minimum wage.
The report reviews evidence on eleven possible adjustments to minimum-wage increases that may help to explain why the measured employment effects are so consistently small. The strongest evidence suggests that the most important channels of adjustment are: reductions in labor turnover; improvements in organizational efficiency; reductions in wages of higher earners (“wage compression”); and small price increases.
Given the relatively small cost to employers of modest increases in the minimum wage, these adjustment mechanisms appear to be more than sufficient to avoid employment losses, even for employers with a large share of low-wage workers.… Continue reading »
Delight, disdain greet Dayton’s plan.
Like an inkblot test, reactions to Gov. Mark Dayton’s budget depended on who was looking at it.
Republicans zeroed in on the tax provisions in the proposal, which included expanding the sales tax to goods and services ranging from baby aspirin to haircuts.
“I don’t know how you can say you’re going to collect $2 billion more in sales tax and not have the people of the state pay that,” said Senate Minority Leader David Hann, R-Eden Prairie. “If you go out and get an oil change on your car, you’re going to pay a sales tax on it. If you go out and get a haircut, you’re going to pay a sales tax. If you join a health club. Those are things you are not paying sales tax on now.”
At the progressive coalition TakeAction Minnesota, executive director Dan McGrath applauded the tax changes.
“Minnesotans understand that we’re all a part of the same team and new investments won’t happen without new revenue,” McGrath said in a statement. “We thank Governor Dayton for his tenaciousness and vision in doing what is right for our state, not what is necessarily easy.”
Jeannette Wicks-Lim, backtofullemployment.org, January 18, 2013
At the start of 2013, ten states raised their minimum wage rates: Arizona, Colorado, Florida, Missouri, Montana, Ohio, Oregon, Rhode Island, Vermont, and Washington. These ten states did so because each has a law requiring that it maintain the purchasing power of the state wage floor with an annual inflation adjustment, also called a “cost-of-living adjustment (COLA)” or “inflation-indexing.”
This flurry of activity sparked, yet again, a political fight over the merits of this century-old labor standard. One issue that comes up is whether minimum wage hikes will trigger inflation, i.e., cause an overall rise in prices.… Continue reading »
Jobs Now Coalition, 2013… Continue reading »
Citizens for Tax Justice, January 2013
There are at least three major categories of tax reforms Congress could pursue to raise revenue. They include ending tax breaks and loopholes that allow wealthy individuals to shelter their investment income from taxation, ending breaks and loopholes that allow large, profitable corporations to shift their profits offshore to avoid U.S. taxes, and limiting the ability of wealthy individuals to use itemized deductions and exclusions to lower their taxes.… Continue reading »
U.S. PIRG, January 2013
When U.S. corporations and wealthy individuals use offshore tax havens to avoid paying taxes to the federal government, it is an abuse of our tax system. Tax haven abusers benefit from our markets, infrastructure, educated workforce, and security, but they pay next to nothing for these benefits. Ultimately, taxpayers must pick up the tab, either in the form of higher taxes, cuts to public spending priorities, or increased national debt.… Continue reading »
Jobs Now Coalition, 2013.
It’s time to raise Minnesota’s minimum wage. The federal minimum wage of $7.25 an hour, or $15,080 a year for a full-time worker, is not enough to meet basic needs—not for an individual or a family. At the current minimum wage of $7.25 an hour, a couple with two children would have to work 155 hours a week to meet basic needs. At normal full-time hours, each parent would need to earn $14.03 an hour to meet basic needs. An individual with no children would need to earn $11.82 an hour.… Continue reading »
David Cooper, working economics: the Economic Policy Institute Blog, December 26, 2012
On Jan. 1, nearly a million workers in 10 states will see the value of their paychecks preserved against inflation. Workers in Arizona, Colorado, Florida, Missouri, Montana, Ohio, Oregon, Vermont, and Washington are protected each year by automatic indexing of their state’s minimum wage. Indexing links the value of the state minimum wage to inflation so that as prices go up, so does the amount that minimum-wage workers must be paid. Low-wage workers in Rhode Island will also see a small boost to their incomes in 2013 thanks to a one-time increase in their state’s minimum wage that was enacted this past June.… Continue reading »
When you think about it, it’s true, people often do think of the economy a bit like the weather as if it’s something we have no control over. “But it’s simply not true because it’s something we create,” said Kathleen Blake, dismissing this common concept.
A community organizer with TakeAction Minnesota, Blake assembled local leaders and legislators for a community discussion session Tuesday afternoon at the Second Harvest North Central Food Bank in LaPrairie. TakeAction Minnesota is a grass-roots, statewide effort to organize and engage communities to “advocate for issues we care about and get people involved in the political process,” she explained.
“I believe that greater Minnesota can be influential. Our advocates from our part of the state can make a difference if we all work together,” began Blake as she invited those gathered to speak about the wide-ranging decisions elected leaders will face regarding the national and state budgets and how these decisions may affect greater Minnesota’s communities.
A group of over forty Minnesotans representing the Americans for Tax Fairness coalition, and including representatives of SEIU, TakeAction Minnesota, Minnesotans for a Fair Economy, ISAIAH and CTUL, demonstrated in downtown Minneapolis this morning calling for an end to the Bush Tax Cuts and tax breaks for big corporations. The demonstration coincided with the first week of the congressional lame-duck session where a budget showdown looms.
Cliff Martin, a first-time voter and high school senior from Northfield, told the crowd that the time is now to make sure people are protected, not wealthy CEOs and corporations. “On Tuesday, I voted for a fair economy,” he shouted. “It’s time the richest who’ve benefitted the most over the past decade start paying their fair share.” Martin supports a corporate tax reform plan that raises substantial revenue from those who have extracted billions from the American economy.
David Berry, Minnesota Department of Labor and Industry, August 2012
This report, part of an occasional series, presents statistics about minimum-wage workers in Minnesota. Specifically, it provides data regarding those hourly workers in the state who are paid the effective full minimum wage or less.1 The effective minimum is the higher of the applicable state and federal levels. The full minimum (e.g., the federal level of $7.25 an hour at the time of this report) is the amount that is not reduced in certain circumstances (see below on this page).
The report presents both trends and current descriptive statistics. All figures regarding Minnesota’s hourly workers at or below the minimum wage are estimates computed from the Current Population Survey (CPS), conducted monthly by the U.S. Census for the U.S. Bureau of Labor Statistics.
The report focuses on hourly workers partly because of data issues concerning salaried workers in the CPS2 and partly because many salaried workers are exempt from the federal and state minimum-wage laws as executive, administrative or professional employees.… Continue reading »
National Employment Law Project, August 2012
This report updates NELP’s previous analyses of job loss and job growth trends during and after the Great Recession.… Continue reading »
National Employment Law Project, July 2012
America’s low-wage economy is marked by two extremes. On the one hand, workers earning at or near the minimum wage are seeing the real value of their paychecks diminish steadily over time, as the cost of living increases while their wages remain stagnant. After nearly half a century of neglect, today’s federal minimum wage of $7.25 per hour is decades out of date. In terms of purchasing power, its value is 30 percent lower today than it was in 1968.
On the other hand, many corporations are posting record-breaking profits. The Wall Street Journal reported earlier this year that, after sinking from 2007 to 2009, corporate profits had successfully caught up to their pre-recession peak by the beginning of 2010–and that by the third quarter of 2011, total profits for U.S. corporations reached a new record high of $1.97 trillion.
This report examines the connection between these opposing extremes of stagnant wages and soaring corporate profits. While a great deal of attention has been directed at the role of Wall Street and the financial sector in driving economic inequality in the U.S., it is important to recognize that the top low-wage employers also bear responsibility for the growing disparity between corporate profits and worker compensation.… Continue reading »
Rebecca Thiess, Economic Policy Institute, April 27, 2012
Many workers are facing uniquely tough times. Though now below its recessionary peak of 10 percent in October 2009, unemployment remains high at 8.2 percent, and job growth is slow. With around 25 million people unemployed or underemployed, it is clear that the jobs crisis did not subside with the official end of the recession. Moreover, workers are still suffering from difficulties that materialized in the decades before the Great Recession, such as deteriorating job quality and stagnant wages. The economic expansion from 2001–2007, for instance, was among the weakest on record; typical family incomes grew by less than one half of one percent between 2000 and 2007 (Bivens 2011). These economic challenges are particularly acute for workers at the bottom of the wage scale.
This paper focuses on low-wage workers—who they are, where they work, where they live, and what their future challenges may be in regards to education/skill requirements, job quality, and wages. Analysis of employment projections from the Bureau of Labor Statistics (BLS) reveals that the future of work will be shaped by much more than labor market skill demands. And in the future, rising wages will depend more on the wage growth within occupations than on any change in the mix of occupations.… Continue reading »
John Schmitt, Janelle Jones, Center for Economic and Policy Research, April 2012
Relative to any of the most common benchmarks–the cost of living, the wages of the average worker, or average productivity levels–the current federal minimum wage of $7.25 per hour is well below its historical value. These usual reference points, however, understate the true erosion in the minimum wage in recent decades because the average low-wage worker today is both older and much better educated than the average low-wage worker was in the past.
All else equal, older and better-educated workers earn more than younger and less-educated workers. More education–a completed high school degree, an associate’s degree from a two-year college, a bachelor’s degree from a four-year college, or an advanced degree–all add to a worker’s skills. An extra year of work also increases skills through a combination of on-the-job training and accumulated work experience. The labor market consistently rewards these education- and experience-related skills with higher pay, but the federal minimum wage has not recognized these improvements in the skill level of low-wage workers.
Even if there had been no change in the cost of living over the last 30 years, we would have expected the earnings of low-wage workers to rise simply because low-wage workers today, on average, are older and much better educated than they were in 1979, when wage inequality began to rise sharply in the United States.… Continue reading »
U.S. PIRG, April 2012
Some U.S.-based multi-national firms and individuals avoid paying U.S. taxes by transferring their earnings to tax haven countries with minimal or no taxes. These tax haven users benefit from their access to America’s markets, workforce, infrastructure and security; but they pay little or nothing for it.… Continue reading »
John Schmitt, Center for Economic and Policy Research, March 2012
It is coming up on three years since the last increase in the federal minimum wage–to $7.25 per hour–in July 2009. By all of the most commonly used benchmarks–inflation, average wages, and productivity–the minimum wage is now far below its historical level.
By all of these benchmarks, the value of the minimum wage peaked in 1968. If the minimum wage in that year had been indexed to the official Consumer Price Index (CPI-U), the minimum wage in 2012 (using the Congressional Budget Office’s estimates for inflation in 2012) would be at $10.52. Even if we applied the current methodology (CPI-U-RS) for calculating inflation–which generally shows a lower rate of inflation than the older measure–to the whole period since 1968, the 2012 value of the minimum wage would be $9.22.… Continue reading »
Restaurant Opportunities Center, February 13, 2012
The restaurant industry employs over 10 million workers in one of the largest and fastest-growing sectors of the United States economy. The majority of workers in this huge and growing sector are women. Despite the sector’s growth and potential to offer opportunities to advance women’s economic security, restaurant workers’ wages have not kept pace with the industry’s economic growth.
The restaurant industry offers some of the nation’s lowest-wage jobs, with little access to benefits and career advancement. In 2010, seven of the ten lowest-paid occupations were all restaurant occupations. The restaurant industry has one of the highest concentrations of workers (39 percent) earning at or below the minimum wage. Moreover, low wages tell only part of the story; workers also lack access to benefits and career mobility. These challenges create a disproportional burden for women.”… Continue reading »
Celinda Lake, Daniel Gotoff, and Alex Dunn, Lake Research Partners, February 2012
Lake Research Partners designed and administered this survey, which was conducted by telephone using professional interviewers. The survey reached a total of 805 likely General Election voters nationwide. The survey was conducted February 1st through February 6th, 2012. The margin of error for this poll is +/- 3.5%.… Continue reading »
John Schmitt, Center for Economic and Policy Research, January 2012
Over the last two decades, high – and, in some countries, rising – rates of low-wage work have emerged as a major political concern. According to the Organization for Economic Cooperation and Development (OECD), in 2009, about one fourth of U.S. workers were in low-wage jobs, defined as earning less than two-thirds of the national median hourly wage (see Figure 1). About one-fifth of workers in the United Kingdom, Canada, Ireland, and Germany were receiving low wages by the same definition. In all but a handful of the rich OECD countries, more than 10 percent of the workforce was in a low-wage job.
If low-wage jobs act as a stepping stone to higher-paying work, then even a relatively high share of low-wage work may not be a serious social problem. If, however, as appears to be the case in much of the wealthy world, low-wage work is a persistent and recurring state for many workers, then low-wages may contribute to broader income and wealth inequality and constitute a threat to social cohesion.… Continue reading »
U.S. PIRG, 2012
Marking the second anniversary of the Supreme Court’s decision in the Citizens United vs. Federal Election Commission case—which opened the floodgates to corporate spending on elections—this report takes a hard look at the lobbying activities of profitable Fortune 500 companies that exploit loopholes and distort the tax code to avoid billions of dollars in taxes.… Continue reading »
Julia Isaacs, Katherine Magnuson, Center on Children and Families at Brookings, December 2011
Many children and youth from families of low socioeconomic status do poorly in school. On average, they perform less well on standardized tests compared with more advantaged youth and are less likely to graduate high school and complete college. These lower levels of academic achievement and educational attainment contribute to lower levels of economic success in adulthood and lower social mobility in our society. Children born into families at the bottom fifth of the income distribution are twice as likely as middle-class children to remain in that bottom bracket as adults (Isaacs, Sawhill & Haskins, 2008). Efforts to improve the economic prospects of children from low-income families have often focused on the educational system, but often with disappointing results (Jacob & Ludwig, 2009). Disparities in academic skills and other areas of development are apparent well before children enter school, suggesting that efforts targeted early in the life course may be effective in preventing the disparities that schools seek to remediate. If we could identify strategies for improving the school readiness of disadvantaged children before they enter kindergarten, we might be able to improve their opportunities for achieving the American Dream.… Continue reading »
