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Economy & Business
Tue December 17, 2013
Calls For Wage Increase in Milwaukee Grow Louder
Scores of people turned out for a rally earlier this month seeking a hike in the minimum wage of $7.25 an hour.
Meanwhile, a Milwaukee County committee has voted to delay action on a “living wage” plan. It would require most employers the county contracts, to pay their workers wages that lift them above the poverty level.
Milwaukee County Executive Chris Abele is concerned the mandated wages would jeopardize local economic recovery. Perhaps fearful of an Abele veto, Finance Committee members postponed action and may seek a compromise on the wage measure.
Supporters say everyone would benefit, if more residents had higher incomes. Opponents insist the plan would burden property taxpayers.
A similar debate is underway, nationally – over the minimum wage. It stands at $7.25 an hour.
The call to raise the minimum wage has been audible in Milwaukee.
Workers and advocates braved the cold earlier this month outside McDonald’s and Wendy’s near 6th and North, marching and chanting. .
Marielle Crowley participated. He says he made $5.90 an hour when he started working for McDonald’s six years ago. He’ll earn over $8 an hour, once he completes a management training program.
“I have no problems with the company, I have no problems working for the company. I just feel like, working for so long, and not really seeing anything from it, it’s hard. But, I still work hard for them, I still put in 110% when I go in to work. All I’m doing is asking for what I’m worth,” Crowley says.
It’s impossible for a full time worker earning $7.25 an hour to make ends meet, according to Michael Wilder. He’s spokesman for the group, Wisconsin Jobs Now which organized the demonstration.
Wilder says when the fast food industry and retailers and other employers pay the minimum, taxpayers must frequently subsidize the workers; so the beneficiaries are the owners and shareholders.
“When you look at the billions of dollars of profits that these corporations rake in annually, I think that the calculation can be made that these workers can be paid more money. Look, when the workers are on public assistance, we the taxpayers have to pay for that. So, in order for these workers to be able to support themselves without public assistance, we need to have $15 an hour and the right to form a union,” Wilder says.
One organization keeping a close eye on efforts to raise the minimum wage is the National Federation of Independent Businesses. Bill Smith represents the Wisconsin chapter.
He says a mandatory boost in the hour rate could harm small businesses climbing out of the recession and navigating a fragile economy.
“Most small businesses operate on a very small margin and it’s just completely unreasonable to expect that they could absorb such a massive increase in payroll costs. They cannot increase sales. They can’t automatically reduce their expenses and they would be forced to raise prices, eliminate jobs, or find other ways to reduce certain functions to avoid hiring new people,” Smith says.
Smith also questions the need for higher baseline wage. He points to a recent report from the Wisconsin Restaurant Association. It indicates that 85% of minimum wage earners are students or young people without children, perhaps just embarking on other careers.
As for specific data about the minimum wage, Sam White says it has lagged the cost of living. White is director of Workforce Development at UWM.
“The equivalent of today’s $7.25 minimum is what it was in 1981 and there’s been significant periods of inflation since then,” White says.
According to White, four of every ten jobs created following the Great Recession are low-wage positions in fields such as food services, hospitality and health care. He wonders how much traction a notable increase in the rate might get, as businesses struggle to produce more and spend less.
“Overall at this point we have been looking very strongly at reducing labor costs across the board, and that’s going to be tough ship to turn around,” White says.
Yet several proposals to increase the hourly rate are making the rounds. One plan would boost the federal rate to $10.10 an hour, while a more modest bump to $7.60 an hour has been suggested in Wisconsin. Both plans would link future increases in the minimum wage to the rate of inflation.
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