Governor’s Minimum Wage Policy Based on Untruths; Union Connection?

FOR IMMEDIATE RELEASE
March 9, 2015

Minimum Wage Hike Does Not Mostly Benefit Low Income Families 

Most RI minimum wage workers were white, middle-class. Only 14% were sole family income earners.

Providence, RI — Governor Gina Raimondo’s press conference today to promote a hike in the state’s minimum wage will create a negative drag on her own goal to increase jobs in Rhode Island. Further, most of the higher wages will likely go to white, middle-income workers, while potentially harming many of the very families the Governor’s plan seeks to assist.

This according to the nonpartisan RI Center for Freedom & Prosperity, which re-published findings from prior research reports.

The strong union support of the plan, with today’s press conference to be conducted at a union hall, raises significant additional questions. According to a 2013 Wall Street Journal article, it is common that many union contracts peg their base-line wages to the minimum wage.

“It is disappointing that one of the first major acts of our new Governor is to perpetuate policies that are harmful to our state’s job market and that bend to special interest demands,”said Mike Stenhouse, CEO for the Center. “The great irony here is that this policy will mostly benefit middle-class whites and union workers, as opposed to low-income minority families. The image put forth – that most minimum wage workers are minority family breadwinners – is simply not true.”
FAST FACTS. According to research by the Center, based on 2012 data, of minimum wage earners in Rhode Island:
  • Over 80% were white
  • $61,299 was the average family income
  • Over 71% were part-time workers less than 35 hrs/wk; 30% less than 20 hrs/wk
  • Only 6% were married, as sole earner
  • Only 8% were single parents
  • Almost 60% lived with their parents or some other primary breadwinner
  • About 60% were 25 years old or younger; over 40% 21 or younger
ADVERSE JOBS IMPACT. The Center’s 2013 report also found, that based on the minimum wage and jobs market at that time, a hike to the same $10.10 per hour level now being promoted by the Governor, would:
  • Destroy almost 3500 jobs, including breadwinners from low-income families
  • Be a continuing assault of the state’s economy
  • Be especially harmful to low-income workers who need upward mobility in a robust jobs market
Read the entire 2013 report here, Read other minimum wage studies by the Center.

 

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