Over one hundred professional economists have signed on to a petition in support of H.R. 1346, the â€śCatching Up to 1968 Act of 2013.â€ť The act, sponsored by Congressman Alan Grayson of Florida, would raise the federal minimum wage from its current level of $7.25 to $10.50 per hour, the approximate level it would have been if the 1968 minimum wage had kept up with inflation. The act also indexes the minimum wage to inflation, ensuring that the real value of the minimum wage would no longer deplete in the way that it has over the past decades.
The petition, signed by economists from dozens of universities and research institutes, explains how a minimum wage employee working full time at the current rate earns $15,080 a year -- 19 percent below the poverty line for a family of three. Raising the minimum wage to $10.50 would â€śdeliver much needed living standard improvements to 45 million U.S. workers and their families.â€ť
The economists counter various claims made against the minimum wage by corporate lobbyists. First, the petition clarifies that, contrary to the argument that minimum wage increases only affect teenagers working summer jobs, the average age for workers affected by the raise would be 32 years old and that only 9.3 percent of those affected would be teenagers.
Second, the petition explicitly challenges minimum wage opponents who argue that minimum wage increases are tied to unemployment, explaining that â€śthe weight of evidence from the extensive professional literature has, for decades, consistently found that no significant effects on employment opportunities result when the minimum wage rises in reasonable increments...because the increases in overall business costs resulting from a minimum wage increase are modest.â€ť
Third, the petition rebuts those who attempt to connect a moderate minimum wage increase with huge consumer price increases, explaining how, for example, the fast-food industry would only see a 2.7% rise in costs. These cost increases, note the economists, can be paid for through negligible price increases, small productivity gains or more equal distribution of companiesâ€™ total revenues.
The economists conclude that raising the minimum wage to $10.50 and indexing it to inflation through the Catching Up to 1968 Act of 2013 would â€śbe an effective means of improving living standards for low-wage workers and their families and will help stabilize the economy,â€ť while â€śthe costs to other groups in society will be modest and readily absorbed.â€ť Moreover, a raise to $10.50, along with other related measures, could benefit the economy overall by promoting greater equality since â€śgreater equality means working people have more spending power, which in turn supports greater overall demand in the economy.â€ť
For more information about this letter and the Catching Up to 1968 Act of 2013, please visitwww.TimeForARaise.org.