The push for a $15 federal minimum wage may have
An analysis of jobs posted from spring 2019 to spring 2021 from a sampling of cities shows many service-sector industries crossed above a $15 starting wage during the period, often by significant margins, according to
Ten states, plus D.C., have passed laws that will incrementally raise their minimum wage to $15 over several years. Campaigning for the presidency,
That some companies are targeting $15 specifically suggests they’re signaling that they’re treating employees more fairly, which still represents something of a victory for the union-backed “Fight for $15” campaign, says Ben Zipperer, an economist at the left-leaning
The tightness has sped up the rate at which Americans are hitting the $15 threshold, either because of supply-and-demand factors or state and local minimum-wage laws. The share of workers earning less than $15 an hour is dropping by about 1.5% a month so far this year, not adjusted for inflation, almost double the rate of the first seven months of 2019, according to Zipperer’s research. Today just under 20% of U.S. workers still make below that level.
To be sure, a 5% rise in the consumer price index has chipped away at workers’ wage gains. Average hourly earnings adjusted for inflation are down 0.9% from August of last year.
Fifty miles northeast of Atlanta, John Culpepper keeps boosting the average wage at his Braselton, Ga., staffing agency, which caters to the area’s big crop of distribution centers and manufacturers. It was $13.39 in the summer of 2020 and has since climbed 25%, to $16.80. Chalk it up in part to aggressive recruiting tactics by employers in the area. For instance, deep-discount retailer
Employers that balk at the new pay rates are losing out, according to Culpepper, who owns four Express Employment Professionals offices in north Georgia. “A lot of them can’t do it, and so therefore they’re having labor shortages, which is affecting them getting product out the door,” he says.
Data from Emsi Burning Glass show a substantial portion of low-paying jobs in metropolitan areas went to $15 and above in the past two years. In Phoenix half of the employers seeking cooks at less than $15 an hour in spring 2019 had moved above that level by spring 2021. Two years ago the lowest wage advertised in job postings for cooks in Phoenix averaged $10.71 an hour, but that jumped 80%, to $19.24, two years later. In Philadelphia 88% of employers that offered less than $15 two years ago for laborers and material handlers had moved above that figure by 2021.
Then there’s Chicago, where an ordinance took effect in July requiring employers with 21 or more employees to pay at least $15 an hour. The wage gains in some low-paying industries in the city have outstripped the new minimum, says Emsi Burning Glass chief economist Bledi Taska. For example, half of Chicago employers that offered less than $15 for personal-care aides two years ago were above that figure by spring 2021, with the average low wage in job postings climbing from $13.28 an hour to $17.78.
It’s important to note that Emsi Burning Glass’s data come with some caveats. For starters, just 35% of job postings specify a wage or wage range. Also, the firm focuses only on large U.S. metro areas, so its findings may not be representative of labor market dynamics in smaller locales. Still, Taska says a clear trend is visible from the millions of job announcements his firm analyzes: “Even without a state mandate, the market is driving employers to go above that threshold.”
If it persists, the upward pressure on wages may wind up feeding into
Progressive think tanks and labor activists reject the idea that labor market dynamics may make the push for a higher federal minimum unnecessary, and they’re pressing for even bigger gains. Zipperer’s think tank, EPI, estimated in January that 32 million U.S. workers would benefit from a $15 minimum wage by 2025—two-thirds of them because they’ll still be earning less than that and the remaining third because their pay may get a boost as employers rejigger their wage scales.
About 40% of the U.S. workforce lives in states where the minimum wage is mandated to rise to $15 an hour, EPI estimates. “I don’t think it ends the conversation,” says Chris Figueredo, who oversees the Ballot Initiative Strategy Center, a nonprofit that pushes for progressive state ballot measures. “The fight for $15 is the floor. It’s not the ceiling.”
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