Kennedy Praises Passage of Fair Minimum Wage Act
MINIMUM WAGE INCREASE PASSES 94-3
Washington, D.C., Feb. 1st, 2007 - Today, Senator Edward M. Kennedy released the following statement on the passage of the Fair Minimum Wage Act:
"Today's vote was not a victory for a bill - it was a victory for the American people. The minimum wage is one of the great achievements of our democracy. It's a clear reflection of our values, and a solid cornerstone of the American dream. It's about the kind of country we want to be.
Americans want to live in a country where everyone has opportunity and the chance to succeed - where anyone who works hard and plays by the rules can build a better life for their family. By passing this bill, we have added dignity to the lives of millions of working families. 13 million Americans will see more in their paychecks for the first time in a decade. They will have more dollars to spend on the essentials of life, and more hours to spend with their families. Six million children will have better food, better health, and better opportunities for the future.
Americans understand fairness, and they know that this is unfair. After years of delay and inexcusable inaction by Congress, the American people finally declared enough is enough. They took the battle into their own hands, and launched a grassroots movement that spread across the nation like wildfire. They pounded their pavements. They prayed in their pews. And they went to the ballot box and held their elected officials accountable for failing to raise the minimum wage.
After 10 years of stalling and 9 days of debate, the time has finally come to vote on an increase in the minimum wage. We will finally have the opportunity to take one step closer to the kind of country we want to be - where no one who works for a living has to live in poverty."
RAISING THE MINIMUM WAGE IS A MATTER OF FAIRNESS
Senator Kennedy's Fair Minimum Wage Act would raise the minimum wage to $7.25 an hour in three steps:
• $5.85 60 days after enactment;
• $6.55 one year later;
• $7.25 one year after that
The number of Americans in poverty has increased by 5.4 million since President Bush took office. 37 million people live in poverty, including 13 million children. Among full-time, year-round workers, poverty has increased by 50 percent since the late 1970s.
An unacceptably low minimum wage is a key part of the problem.
Minimum wage employees working 40 hours a week, 52 weeks a year earn $10,700 per year, almost $6,000 below the federal poverty guidelines of $16,600 for a family of three. Since then the minimum wage was last raised in 1997, its real value has eroded by 21.3 percent.
Every day the minimum wage is not increased, it continues to lose value, and workers fall farther and farther behind. Minimum wage workers have already lost all of the gains of the 1996-1997 increase.
Today, the real value of the minimum wage is more than $4.00 below what it was in 1968. To have the purchasing power it had in 1968, the minimum wage would have to be more than $9.37 an hour today, not $5.15.
Nearly fifteen million Americans will benefit from a minimum wage increase to $7.25 an hour - 6.6 million directly, and another 8.3 million indirectly. Fifty-nine percent of these workers are women, and forty percent are people of color.
Eighty percent of those who would benefit are adult workers, not teenagers seeking pocket change. Fifty-four percent of workers who will benefit are full-time employees, and more than a third of these adults are sole breadwinners for their families.
Increasing the minimum wage will help more than 7.3 million children whose parents would receive a raise.
Raising the minimum wage to $7.25 an hour will mean an additional $4,400 a year to help minimum wage earners support their families. It would be enough money for a low-income family of three to buy:
• 15 months of groceries
• 19 months of utilities
• 8 months of rent
• Over two years of health care
• 20 months of child care
• 30 months of college tuition at a public, 2 year college
This year, the Senate raised its pay by $3,100 and is set to receive an additional $3,300 raise in 2007. It is shameful that Members of Congress received our eighth pay increase in nine years, yet we have not provided a single pay increase to the lowest paid workers.
The salaries of lawmakers have gone up by $31,600 since 1997, while minimum wage workers continue to earn just $10,700 a year.
History clearly shows that raising the minimum wage has not had any negative impact on jobs, employment, or inflation. In the four years after the last minimum wage increase passed, the economy experienced its strongest growth in over three decades. Nearly 12 million new jobs were added, at a pace of 248,000 per month. In contrast, in the last four years, the minimum wage has held steady, but only 4.9 million jobs have been created.
States across this country have raised their own minimum wages without adverse economic consequences. Study after study has shown that raising the minimum wage has not cost jobs in the states. An Economic Policy Institute study of Washington, Oregon, and Alaska showed that increases in the state minimum wage had no impact on the state unemployment rate. Similarly, the Massachusetts Budget and Policy Center has found that after the last two minimum wage increases in Massachusetts in 2000 and 2001, employment grew more quickly in sectors with the most minimum wage workers, including leisure, hospitality, and the service sector.
A recent Gallup poll found that 86% of small business owners do not think that the minimum wage affects their business, and three out of four small businesses said that a 10% increase in the minimum wage would have no effect on their company. Additionally, nearly half of small business owners think that the minimum wage should be increased, and only 16% of owners think the minimum wage should be reduced or eliminated entirely.
Britain has the second largest economy in Europe (after Germany). They implemented a minimum wage in 1999 that has had no adverse employment effects, and has lifted 1.8 million British children out of poverty. They raised their minimum wage to about $9.51 per hour last year, and they are planning to raise this rate to about $9.89 in October of this year.
Ireland has an extremely robust economy, with impressive growth over the last decade, and the fourth largest GDP per capita in the world. The minimum wage rate in Ireland is 7.65 /hour (about $9.65) and yet their unemployment rate is lower than the U.S.
