Push states in for a $20 minimum wage as inflation continues

ALBANY, NY — Just years after labor activists persuaded a handful of states to raise their minimum wages to $15 an hour, workers who were initially excited about the wage increase are finding their hard-won gains erased by inflation.

New York City resident Anthony Rivera, 20, who sorts packages at a United Parcel Service branch in Brooklyn, said he had to take a second job at a grocery store after his food costs skyrocketed.

“I was on $15 an hour with UPS, and when it came to paying bills and buying groceries, it wasn’t starting to feel like enough,” he said. “That left me with no option but to take up another job.”

New York, California and Massachusetts are among the states where pro-labour forces are now introducing proposals that, if approved, would raise the minimum wage to $20 or more in the next few years.

Inflation has meant that something that cost $15 in 2012 — when labor activists adopted the slogan “Fight for $15” in an attempted wage increase — is likely to cost nearly $20 today, according to the U.S. Bureau of Labor Statistics.

But opponents of the wage increases say they could hurt small businesses, which have already taken a major hit during the coronavirus pandemic.

Cindy Lee, the owner of a bowling alley in Endicott, New York, said she is struggling to pay off loans she took out during the pandemic that kept her business afloat.

“All these expenses all at once are just going to kill us. I will definitely have to cut back on workers somewhere if wages are raised,” Lee said, adding that she would also have to raise prices for bowling, food and liquor.

The federal minimum wage in the United States has remained at $7.25 an hour since 2009, but states and some localities are free to set higher amounts. Thirty states have opted for this.

Over the past decade, union groups have pushed $15 as the goal by which low-wage workers could support themselves within the 40-hour week. A growing number of states across the political spectrum have passed legislation that will raise their minimum wages above that amount for years to come, including Florida, Nebraska and Illinois. Eleven states have introduced wage increases of $5 or more in the past decade.

Yet those gains were dampened almost immediately. Inflation in the United States reached a new 40-year high last summer after prices for basic necessities such as gas and food skyrocketed. Supply chain issues due to the coronavirus pandemic, coupled with Russia’s invasion of Ukraine, have disrupted gas and food supplies, sending prices skyrocketing.

Labor activists are pushing for a new round of wage increases, even as the old ones are still being phased in.

A bill in New York would increase the state’s minimum wage to $21.25 by 2026, then adjust it for inflation each year in the future. Currently, minimum wage workers in New York City are paid $15, while the rest of the state earns $14.20.

In Massachusetts, a bill proposes to raise wages every year until it reaches $20 by 2027, compared to $15 today.

And in California, where the minimum wage is currently $15.50 for all workers, legislation signed in September would have set the state on track to raise wages for fast-food workers to $22 an hour. The law was met with strong opposition from restaurant industry groups who successfully pushed for a referendum on it in 2024.

Supporters of a proposed wage increase in New York say they hope it will be included in the state budget, which is expected to be finalized in early April.

“You can’t tell us that after the pandemic that $15 will still be enough to keep food on our tables,” Sen. Jessica Ramos, a Democrat representing parts of Queens, said at a rally in Albany. “That’s why we want $21.25, nothing less. The price of everything goes up, except wages.”

In her budget proposal, New York Governor Kathy Hochul, also a Democrat, proposed linking minimum wage increases to inflation, but with a cap on how much wages could increase in a year.

Barry Nicholson, the owner of four retail businesses in Corning, a town on New York’s Finger Lakes, said a wage increase to $21.25 would be “a slap in the face to small businesses.”

“I just couldn’t handle that,” says Nicholson, owner of two UPS stores, and stores for women’s accessories and modern home furnishings. of the day. We’re not the big companies everyone talks about.”

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Maysoon Khan serves on the Corps for the Associated Press/Report for America Statehouse News Initiative. Report for America is a non-profit national service program that places journalists in local newsrooms to report on undercover issues. Follow Maysoon Khan on Twitter.