Skip to main content
Link to news home page
News

Minimum-wage hike would aid state workers

September 23, 2003

Raising the state minimum wage to $6.80 per hour would benefit more than 130,000 Wisconsin workers, according to a new report by the Center on Wisconsin Strategy, “Raising the Floor: Who Would Benefit From a Minimum Wage Increase in Wisconsin.”

The new report is timely given the Doyle administration’s “Grow Wisconsin” plan that recommends a minimum-wage hike. The $6.80 figure would put a family of three with one full-time worker just at the federal poverty line.

“People often think of the minimum wage applying mostly to teenagers with part-time jobs, but that’s just wrong. Most minimum wage workers are adults, and a large share of them are working full time,” says Joel Rogers, COWS director and one of the authors of the report. “No parent who works full time should be miserably poor.”

Among the report’s central findings:

  • Raising the minimum wage in Wisconsin to $6.80 would directly benefit 130,400 low-wage workers, and would indirectly benefit another 147,600 workers who now earn between $6.80 and $7.80 an hour.
  • Most of the workers (57.6 percent) who would benefit directly are adults.
  • More than two-thirds of the workers who would benefit directly (67.8 percent) are working more than half time, and nearly a third (31.2 percent) are working full time.
  • The bottom 20 percent of Wisconsin earners receive 5.4 percent of total weekly earnings, but would receive 36.2 percent of the benefits from a minimum-wage increase.

“A modest increase in the minimum wage is pretty much what economists don’t believe is possible, namely a “free lunch,'” observes Laura Dresser, COWS research director and a co-author of “Raising the Floor.” “We used to think there were heavy negative employment effects that offset the positive wage effects, but research shows that we were just wrong.”

“The minimum wage today, $5.15 an hour, is way below its historic level,” Rogers adds. “A raise to $6.80 really just corrects for inflation. If you corrected for growth in worker productivity, the raise would be to $11 an hour. That tells you how low we’ve let it drop, and how easy it’d be to adjust to the increase considered here.”

“Raising the Floor: Who Would Benefit From a Minimum Wage Increase in Wisconsin” is available at http://www.cows.org.