Indiana Needs A Raise -- It's Time to Raise the State Minimum Wage
The public policy in state law for minimum wage mirrors the 1938 Fair Labor Standards Act. The Minimum Wage Law of 1965 stated that public policy was to recognize persons are employed in some occupations at wages insufficient to provide adequate maintenance for themselves and their families. The policy further recognizes individuals employed in these occupations constituted unfair competition against other employees and their employers, threatens the stability of industry, and requires, in many cases, income be supplemented by the payment of public monies for relief or the provision of other public and private assistance. Employment of persons at such insufficient rates of pay threatens the health and well being of the people of the State of Indiana and injures the economy of the state
The biggest and best single program to help the working poor would be a higher minimum wage. With a higher minimum wage, the working poor could take the first giant step in pulling themselves, and their families, up out of poverty into the mainstream of our economic life. The boost to consumer spending would not only help business, but also help our state's social welfare system.
Poverty on Minimum Wage Pay
The $5.15 per hour state and federal minimum wage, now in effect, is ridiculously low in relation to the working family's needs. It takes an annual income of $13,650 in 1998 to lift a family of three out of poverty or a full-time job making $6.56 per hour. Even at the 1998 federal minimum, the wage earner is one dollar and forty-one cents an hour less than what is required to be at the poverty line for the family of three The employer's failure to pay a living wage causes the taxpayers of the state to supplement and sustain the minimum wage workers. Keep in mind this is the hourly wage earner and does not include the so-called salary worker. Many salary workers have fancy titles like assistant manager or management trainee, but often they are paid at minimum wage.
The Working Poor and State Tax Dollars Are Hit by the Low Wage
Senator Dole was quoted on 3/27/96 as saying, "increasing the minimum wage will only help teenagers, black teenagers". Nationally, only one in fourteen minimum wage earners is a teenage student from a family earning above average earnings. Sixty three percent of minimum wage workers are adults age 20 and over. The average minimum wage earner brings home 50 percent of his or her family's weekly earnings and 36 percent are the sole breadwinners for their families. Hoosier household median income ranks 32nd in the nation at $33,004. For a state with one of the highest paid CEO's in the nation (Stephen C. Hilbert, earned over $59,800 per hour in 1997), we fail to see the decline in both actual and real wages with our less fortunate. Hilbert makes more in one hour than our minimum wage earners do in nine years, at 40 hours a week. 106,710 families in 1997 received a monthly allowance of $288.00 in subsidies through A.F.D.C.. In 1974 Indiana ranked 16th in the nation for Average wage per job. By 1998, we fell to a rank of 39th in the nation. There are over 210,000 working single mothers are in this state, and at least 32,000 of them work in professions that require government subsidies to sustain their families. Our working poor is increasing and not following the national trend of upward mobility.
Social Effects of Low Minimum Wage
Business and the economy generally suffer when low-wage workers don't have enough income and buying power to get what they need. Child care is too costly for low-wage workers and so they may leave their "latch-key" children without adult supervision. We have gone from a ranking of 22nd for juvenile violent crime to 14th in less than ten years. Murders in Indianapolis broke an all-time high in 1996 and 1998. When only low-wage jobs (or no jobs) are available, crime and anti-social behavior become tempting alternatives to regular paid work.
Tie the State Minimum Wage at least at the Federal Level
The current minimum wage is still not be enough for thousands of Hoosiers to pull out of poverty. $5.15 per hour is still below federal poverty for a family of two. The minimum wage's original intent was one-half of the state average wage. This would be a least $6.37 today. $5.15 an hour is 81% of the original intent of our legislative body. We urge the Indiana General Assembly to increase the state minimum wage to a level equal to, or exceeding, 50% of the state average wage. |
