It would take $9.92 today to match the buying power of the minimum wage at its peak in 1968. In today's dollars, the 1968 hourly minimum wage adds up to $20,634 a year working full time. The new federal minimum wage of $7.25 comes to just $15,080. That's $ 5,554 in lost wages. The long-term fall in worker buying power is one reason we are in the worst economic crisis since the Great Depression. When the minimum wage became law in 1938, President Franklin Roosevelt called it "an essential part of economic recovery." And so it is today. Consumer spending makes up about 70 percent of our economy. We can't build a strong economy on poverty wages. A growing share of workers make too little to buy necessities. If the minimum wage had stayed above the nearly $10 value it had in 1968, it would have put upward pressure on the average worker wage. The Let Justice Roll Living Wage Campaign, which I advise, is calling for a minimum wage of $10 in 2010. It's time to break the cycle of too-little, too-late raises. — Holly Sklar, McClatchy-Tribune News Service
On July 24, the federal minimum wage increased for the third time in three years to $7.25 per hour. A small business with 20 entry-level employees will see more than $30,000 in new labor costs due to the increase. That doesn't include the higher taxes the employer has to pay. Research has shown that minimum-wage hikes take a sledgehammer to the entry-level job market. In a 2007 survey, 73 percent of labor economists said increases in the minimum wage lead to employment losses. Teens get hit especially hard. Adult entry-level workers find themselves displaced. Businesses respond by laying off workers and cutting back on hours. The companies that are still hiring seek out more skilled applicants who are worth the higher wage, or switch to automated labor. The latest minimum-wage hike will only prolong the nation's affliction with high unemployment — hurting job prospects for our most vulnerable workers and denying teens the opportunity to gain valuable on-the-job training this summer. — Kristen Lopez Eastlick, Employment Policies Institute
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