By Jon Delano
/ CBS Pittsburgh
Minimum wage not going up in Pennsylvania
PITTSBURGH (KDKA) - The minimum wage is going up in most neighboring states in January, and in some states, that increase is tied to inflation. But Pennsylvania stands alone among its neighbors in not providing any relief for low-wage workers.
The federal minimum wage has been stuck at $7.25 since 2008, which when adjusted for inflation, makes it the lowest in decades.
"It has not been this low in value since February 1956, since the time Elvis Pressley had his first number one hit, Heartbreak Hotel, February 1956," said Dave Kamper with the Economic Policy Institute.
With Congress gridlocked from raising the wage, many states have stepped in on their own.
"Right now about half the states have their own minimum wage but a ton of cities do as well," said Dori Goldstein with Bloomberg Law.
But Pennsylvania is not one of them. The state's minimum wage is $7.25. While Gov. Tom Wolf wants an increase to $12 dollars and ultimately $15, the Republican-controlled legislature has never approved an increase.
"Pennsylvania is a little bit of a holdout for where it is," Goldstein said.
And it has kept Pennsylvania cities from setting their own minimum wage as many large cities do across the country.
"The state prohibits cities like Pittsburgh and Philly from passing their own minimum wage increases, and those are pretty major cities," Goldstein said.
Some of the fastest growing cities have much higher minimum wages. Denver's minimum wage in January will be $17.29, surpassing Seattle's by two cents.
"There is no place in this country where you can meet the standard of living of an adult and a child on a minimum wage job in this country. None," Kamper said.
With inflation at over 8 percent, not raising the minimum wage this year will take a toll, which is why a number of states have indexed their minimum wage to inflation. It's called a COLA, or cost of living adjustment.
"Real wages for workers, which is what a worker's wages is actually worth in terms of what they can buy, have fallen through the pandemic rather than actually gone up. Indexing minimum wage to inflation is a way to make up for that," said Kamper.
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As an enthusiast in economics and policy, this article on Pennsylvania's minimum wage intricacies really hits home. The depth of the issue is far-reaching, and the evidence presented here underscores the critical need for a minimum wage adjustment. Let's break down the concepts in this piece:
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Minimum Wage: The federal minimum wage in the United States has remained stagnant at $7.25 since 2008. This figure, when adjusted for inflation, is notably the lowest in decades, creating financial hardships for low-wage workers.
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State Disparity: The article highlights how neighboring states are increasing their minimum wage, some tying it to inflation. Pennsylvania, however, has not provided any relief for its low-wage workers, making it an outlier among its neighbors.
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Legislative Challenges: Despite the Governor's efforts to raise the minimum wage in Pennsylvania to $12 and eventually $15, the Republican-controlled legislature has not approved an increase.
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City vs. State Authority: Pennsylvania restricts cities like Pittsburgh and Philadelphia from setting their own minimum wage, unlike many other major cities across the country. This lack of autonomy poses challenges for local governments to address the cost of living within their boundaries.
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Inflation and Cost of Living Adjustment (COLA): The article also touches on the impact of inflation, which currently stands at over 8 percent. Some states have implemented COLA, indexing their minimum wage to inflation to ensure that wages keep pace with the rising cost of living.
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Real Wages and Pandemic Impact: The pandemic exacerbated the situation, with real wages for workers declining rather than increasing. Indexing the minimum wage to inflation is seen as a way to counter this trend and restore the actual purchasing power of wages.
Understanding these concepts helps grasp the complexities and implications of the minimum wage issue in Pennsylvania. It's evident that the stagnant federal minimum wage, combined with legislative hurdles and limitations on local autonomy, creates a challenging landscape for low-wage workers in the state.
