Minimum Wage Hikes Fuel Higher Pay Growth For Those At The Bottom

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Something unusual is happening in the US. Labor market workers at the bottom of the income ladder. Our finely seeing bigger pay raises than those who are higher up. That is partly because of the tight job. The market with unemployment near a fifty year low businesses have to pay more to attract new workers. Minimum wage though is also play here. Economists say minimum wage hikes at the state and local level. Well are giving a boost to millions of workers here's NPR's Scott horsely. Kista Jelly works a grocery store in Springfield Missouri. She typically works the closing shift noon. Eight or for three to ten PM. I'm a cashier Isis people every day with their groceries when she started almost two years ago jolly made minimum wage. which at the time was seven dollars? Eighty eighty five cents an hour in Missouri. She still making the minimum but thanks to a ballot. Measure passed in two thousand eighteen. That minimum is going up when jolly gets our first paycheck of twenty twenty twenty on Friday. She'll be earning nine forty five an hour. I would hope that it gets better and I think that I'll be better off but I think that it's going to still be a struggle jealous or paycheck. We'll still barely cover her rent and utilities. She relies on food stamps and school lunches to help feed her three children ages. Six eleven and fourteen jollies grateful that Missouri voters approved three additional increases in the minimum wage over the next three years by twenty twenty three to twelve dollars an hour. I've got at least a pecent living wage and then people can pay their bills. They can possibly get a few things on their wants list every month. Like kids need new clothes. or I'm that girl I ran out of Mascara like a month ago. Luxury items such as new socks in Arizona Colorado and Maine. The minimum wage is already twelve dollars an hour. Our the federal minimum has been stuck at seven twenty five an hour for more than a decade. But economists aren't today she says nearly two dozen states gave minimum. Wage workers raised raised on January. First if you're a minimum wage worker in America right now on average you're probably getting paid closer to twelve dollars an hour. That's what they call the effective minimum wage. And today she says those rising minimums are an important factor helping to lift up workers at the bottom of the pay scale. Right now the economy. Oughta me is doing something extraordinary. People at the bottom have actually seen higher wage growth than people at the top and in the middle minimum. Wages aren't the only factor. Today she says low wage workers also have more bargaining power now as employers scrambled to fill job openings. When unemployment's just three and a half percent the patchwork of minimum wages around the country. It does create a sort of natural experiment though for economists trying to measure the effects on low wage workers at least Gould who's the left-leaning Economic Policy Institute. Compared states raised their minimums to those. That didn't no matter how you cut it. The low wage workers are getting a larger wage boost in states that have raised their minimum wage. Gould estimates the higher minimums that took effect this month. Boosted paychecks for nearly seven million workers across the country economist. David Newmark of UC Irvine cautions. However the higher cost for employers may come with trade-offs. You're getting a raise if you keep your job and if you're ours don't change but there's plenty of evidence that there is some job Wasserman. The minimum wages and those workers are worse off newmark acknowledges job loss associated within wage. Hikes is probably less of a problem when unemployment is this low. CASSIA jolly hasn't seen any job cuts at the grocery store where she works. The cashier doubt she'd be getting a raise. Were it not required by the higher minimum. We still need to keep pushing for weird because hopefully people like me will be able to actually make it every month. Jelly says it's a shame when a grocery store worker has to choose between buying food and paying her bills

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