Pennsylvania House Democrats have a Plan for PA, a New Way Forward that puts People First with Good Jobs, Quality Schools and Fair Taxes.

#Plan4PA makes minimum wage a living wage

Pennsylvanians' paychecks drive the economy, and PA is falling behind

Pennsylvania House Democratic Caucus   Jan 08, 2018

In a recent post we discussed the first tenet of the Plan4PA - #PeopleFirst.  What better way to focus on putting #PeopleFirst in PA than discussing a living wage.

According to a recent study by the Keystone Research Center, Pennsylvania is falling behind our neighboring states, which have increased minimum wages an average of 26 percent since 2013.  Delaware, Maryland, Ohio, New Jersey, New York and West Virginia have all had increases in that time.

“Public support in Pennsylvania for a higher minimum wage has always been strong because most people intuitively understand that what ultimately drives the economy comes down to what’s in their paychecks,” said report author and KRC labor economist Mark Price, Ph.D. “The data we review here make it very clear that the failure to raise the minimum wage in Pennsylvania has not benefited the economy or wage growth relative to neighboring states.”

Representative Patty Kim has a bill that would raise the minimum wage.  Kim’s bill, House Bill 1520, incrementally increases the minimum wage to $15 per hour by 2024, and would increase it in successive years with a cost-of-living adjustment.

Below are some key findings from the Center’s report:

• The Pennsylvania minimum wage this January at $7.25 stands 13.8 percent below the minimum wage in Delaware (where the minimum wage is $8.25); 14.5 percent below the minimum in Ohio ($8.30); 18.6 percent below New Jersey’s minimum ($8.60); 20.7 percent below West Virginia ($8.75); 27.6 percent less than Maryland ($9.25); 43.4 percent below most of New York state ($10.40, but the minimum in New York City, Long Island and Westchester ranges from $11 to $13); and 72.4 percent below the District of Columbia ($12.50).

• Examining county level data on employment and average weekly wages drawn from a survey of employers in food services and drinking places, a sector with a large share of low-wage workers, the report observes more growth in wages and employment especially in New York, northern West Virginia, and Maryland than in Pennsylvania.

• Overall in Pennsylvania, real wages in food services grew by just 5 percent, while on average across the region (Delaware, District of Columbia, Maryland, New Jersey, New York, Ohio, and West Virginia) they grew 7.8 percent between 2012 and 2016. Wage growth in food services has been particularly low in many rural areas of Pennsylvania.

• Not only has wage growth been stronger in the rest of the region where the minimum wage has increased, but so has employment growth. As the purchasing power (after accounting for inflation) of the minimum wage rose 12 percent across the region, Pennsylvania’s minimum wage lost 4.7 percent of its purchasing power from 2012 to 2016.

• With the minimum wage now fixed at the federal minimum of $7.25, the lowest earners today in the state earn just under a third (31.9 percent) of what the typical Pennsylvania worker earns.

All Pennsylvanians earning a living wage is the cornerstone of the #Plan4PA’s #PeopleFirst agenda.  Let’s fight to make it happen.


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