Indiana News

Charting a Course on the Map of Minimum Wage Laws

New York will become 19th state to set higher minimum than federal law

8/30/2013

 

Fast-food workers who staged a one-day strike in Indianapolis and other cities Thursday to call for a higher minimum wage are seeking a far higher rate than anyone has proposed.

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The fast-food strikers call for a $15-an-hour minimum, more than double the current $7.25. 18 states have set higher minimum wages than federally required, but the highest is Washington at $9.19. President Obama proposed an increase to $9 an hour in his State of the Union address -- no state other than Washington is currently that high.

Indiana and 30 other states are governed by the federal minimum. Nevada has a foot in both camps, mandating a wage of $7.25, but increasing that minimum by a dollar an hour for employers who don't provide health insurance.

On New Year's Eve, New York will become the 19th state to go beyond the federal minimum, taking the first step of three steps toward a $9-an-hour wage. Two states, Massachusetts and Connecticut, require that the state minimum be higher than the federal requirement.

All Indiana's neighbors except Kentucky have minimum wages higher than federal law requires, but the only other Midwestern state to do so is Missouri. With the exception of Florida, all the other high-wage states are in the west or the northeast.

Indiana Chamber president Kevin Brinegar suggests the divide is political: Republican states match the Chamber's position of letting the most skilled or in-demand jobs command higher wages, while Democratic states have passed higher wages. Massachusetts and the other six states with minimums of eight dollars an hour or more are all blue states. But Republican Alaska and Arizona, and swing states such as Florida, Ohio, and Colorado, have all approved smaller increases.

Indiana AFL-CIO president Nancy Guyott says the minimum wage should be high enough to keep working families out of poverty. She says she doesn't advocate any specific figure, but says even Washington hasn't kept pace with the dollar's buying power from the time the minimum wage was established.

Brinegar argues a minimum-wage increase would force employers to cut jobs. Five of the seven states with the highest unemployment rates have gone above the federal minimum. But three of the higher-wage states have jobless rates more than a full point below the federal rate, including Vermont, with both the third-highest minimum wage and third-lowest unemployment. Washington, at the top of the wage scale, is half a point below the national unemployment rate.

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