Published March 03, 2014
President Obama will continue his push for a nationwide federal minimum wage hike Wednesday visiting New Bristol, Conn., for a “Raise the Wage” event. The state raised its minimum wage to $8.70 from $8.25 on Jan. 1, making it one of the states with a higher-than-average minimum wage rate.
Obama issued an executive order in early February that increased the minimum wage for new federal contractors to $10.10 an hour from $7.25. He called for a nationwide pay raise to $10.10 during his State of the Union address in January.
Obama’s wage increase for federal contractors is the first for the federal minimum wage since 2007, and the White House has estimated the move will help 28 million workers. Today, the average full-time minimum wage worker earns $14,500 a year.
In addition to Connecticut Gov. Dannel Malloy, Obama will be joined by Democratic governors, Lincoln Chaffee of Rhode Island, Deval Patrick of Massachusetts and Peter Shumlin of Vermont.
Fast food workers in particular have led a push over the past year and a half for a $15 minimum wage raise, which they say would better enable them to support themselves and not rely on government welfare programs. However, business owners say such an increase would lead to job cuts.
Pam Villarreal, labor expert at the National Center for Policy Analysis, points out the unemployment rates in many of the attending governors’ states are higher than the national average of 6.6%, highlighting one of the reasons why raising the minimum wage could be troublesome for job growth.
For example, Rhode Island’s unemployment rate is the worst in the country as of January at 9.1%, while its minimum wage is $8 an hour, as of Jan. 1.
“It’s a distraction,” Villarreal says of the push. “The administration has failed at creating jobs that are actually high paying. The answer is to take lower-skilled jobs and raise the wage instead.” The White House has said it expects the impact on total jobs if wages were increased to be minimal.
Villarreal says she would rather see a push to raise the skill level for workers across the board, so they can better move up the ladder and advance their pay. “He will be flanked by governors in northeastern states that don’t have unemployment rates to brag about, so it’s really just more of the same,” she says.
She adds that the event won’t change the minds of more conservative business owners that may not be willing to change their hourly pay.
“This is preaching to the choir,” she says. “Business owners who feel this way will not be convinced otherwise. This is a way to get everyone off of ObamaCare and policy issues, but it’s starting to look desperate.”