Lawmakers in Augusta have an opportunity to improve the lives of thousands of Maine families, not through a major health care overhaul or by remaking the state’s tax system, but simply by increasing the minimum wage. Passing LD 235 would be a good start.
The state’s minimum wage is now $6.50 an hour. LD 235, passed 8-5 by the Labor Committee last month, would increase it to $7 an hour over two years. This modest increase won’t necessarily move families out of poverty, but it would help them better afford food, heating oil or a tank of gasoline.
According to the Maine Center for Economic Policy, a single person in Maine needs to earn more than an average of $9 an hour to earn a livable wage. A single parent with two children would need to earn more than an average of $18 an hour and a family with two workers and two children would need to earn more than an average of $23 an hour.
A livable wage is calculated by dividing the expenses in a basic needs budget by the number of hours in a year of full-time work. A basic needs budget includes costs for housing, transportation, child care, health care and taxes. The budgets vary by region within Maine and the country. According to the Maine Economic Growth Council, about one-third of the state’s workers do not earn a livable wage, a percentage that has remained unchanged since 1999. As a result, the percentage of Maine workers who hold multiple jobs – 8 percent – is significantly higher than the national average.
Maine is one of 18 states that have a minimum wage that is higher than the federal level of $5.15. The Center for the Study of Social Policy, based in Washington, D.C., says a reasonable minimum wage is particularly important in states like Maine that have lost large numbers of manufacturing jobs, and where many workers now earn lower wages in the service sector.
Arguments against raising Maine’s minimum wage, which was increased two years ago, are that it will benefit mainly teenage workers and that if employers have to pay higher wages, they will hire fewer people. More than 70 percent of the roughly 20,000 workers who earn the minimum wage or less are adults, many of them single mothers.
Raising the minimum wage enables some to stop their reliance on state and federal subsidies. Studies have found that federal minimum wage increases caused no loss of jobs, likely because employers absorbed some of the increased costs through higher productivity, lower recruitment and training costs, decreased absenteeism and increased worker morale.
An increase in the minimum wage is a small price to pay for these benefits for workers and the state.
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