Fourteen states and the District of Columbia will see their minimum wage increase this summer or next year, according to a report by the National Conference of State Legislatures.
Kansas won’t be joining them. The minimum wage in Kansas is $7.25 per hour – the same as the federal minimum wage – and attempts to increase it this year gained little traction in the Republican-dominated Legislature.
The federal and state minimum wages last increased in 2009.
Twenty-nine states and the District of Columbia have a minimum wage above the federal level, including neighboring Nebraska, which is set to see its minimum wage rise from $8 an hour to $9 in January.
Rep. Jim Ward, D-Wichita, proposed legislation during the first week of the legislative session, to raise the Kansas rate to $8.25 in July and by another $1 each of the next two years. The bill did not receive a hearing during the record 114-day session.
“More states are doing it. First of all, it’s wrong to work full time and live in poverty,” Ward said Monday. “The second thing is that when more money is in working folks’ pockets, there is economic stimulus, meaning they’re going to go out and buy stuff. People who work in minimum wage, they’re going to spend their money in the communities, which is a stimulus to business.”
However, Republican leaders warn that a hike to the minimum wage would have an adverse effect on business.
“In an economy where small businesses are struggling to survive, the minimum wage represents just another business mandate which suppresses job growth,” House Majority Leader Jene Vickrey, R-Louisburg, said in an e-mail. “Kansas should be focused on building a middle class economy, not a minimum one.”
Jeremy Hill, the director of the Center for Economic Development and Business Research at Wichita State University, said that there are costs and benefits to increasing the minimum wage.
Low-wage employees see a short-term benefit with more money to pay their bills and spend on goods, but “in the long run businesses are going to correct for it…and increase their prices,” he said.
Hill said some “marginal workers” would be priced out of the job market by a higher minimum wage. “Some people may not be worth the value of that minimum wage (to employers),” he said.
He recommended divorcing the minimum wage from political decisions and tying it to the consumer price index instead. “Then businesses have a way of planning for it and you wouldn’t have that political part of it, which is so hard on the business market,” he said.
Two states bordering Kansas have gone down this path.
Missouri and Colorado stand at $7.65 and $8.23 respectively, both having passed constitutional amendments in 2006 that tie their minimum wage to the cost of living, raising it or decreasing it each year accordingly.
Michigan is set to increase its minimum from $8.15 to $8.50 in January and then increase it to $9.25 over the next two years. Starting in January 2019, Michigan will begin annual increases based on the consumer price index.
Minnesota differentiates between large and small businesses when setting its minimum wage. In August, the minimum wage for employees of Minnesota businesses that have $500,000 or more in annual sales will increase from $8 per hour to $9, while businesses below that threshold will have to pay employees a minimum of $7.25.
Ward said Wichita’s economy took “huge cut in those high-wage, high benefits jobs” after the recession hit the aviation industry hard.
“The people who were in those jobs have now gone into other jobs, a lot of which are minimum wage, service, retail,” Ward said. “And now they’re working two jobs for less than they got paid for one job and they don’t have any benefits…which is bad for the economy. It’s just bad long-term.”
The Kansas Department of Labor said in December that the state had regained the total number of jobs lost during the recession, but that it had largely not recovered the manufacturing lost.