FOR IMMEDIATE RELEASE:
February 26, 2013

Assembly Policy Paper on Minimum Wage:
Good for Working Families and Local Businesses

Report Cites Evidence that Minimum Wage Increase
Will Boost Consumer Spending and Spur Economic Growth


Assembly Speaker Sheldon Silver joined with Assemblyman Keith L. T. Wright and Assembly Labor Committee Chairman Carl E. Heastie today to release a policy paper that examines the existing minimum wage and how an increase to $9 an hour, combined with indexing, will provide significant relief for hard working families and improve our economy.

The minimum wage in New York has increased only ten cents in the last six years. In 2009, an increase in the federal rate brought the minimum wage to $7.25. A full-time minimum wage employee earns slightly more than $15,000 a year.

"The Assembly Majority has been a longstanding champion of workers' rights and atop that list is the right of a worker to earn a dignified wage. No full-time worker who puts in an honest day's work should live in poverty," said Silver. "Certainly, no one could raise a family on this income without government assistance. The reality is that the current minimum wage is not sufficient to provide food and shelter let alone access to health care or retirement security."

According to the report, an increase in the minimum wage to $9 an hour would directly benefit more than 925,000 workers in New York. Eighty-four percent of those affected are adults and 87 percent work more than 20 hours per week. Nationally, African-Americans and Hispanics are disproportionately represented among low-wage earners. Women represent approximately two-thirds of the minimum wage earning population and 61 percent of the full-time minimum wage earners.

"As sponsor of this vital piece of legislation, I firmly believe that there is an urgent need to raise the minimum wage in New York State. Not only is it a matter of economic fairness, but increasing the minimum wage and linking it to inflation will help spur our local economies. The low-wage workforce in this state is disproportionately represented by women, African Americans and Hispanics and to these communities, an increase means worrying a little less about putting food on the table and heating their homes. Senate Republicans are blatantly ignoring the needs of our residents. I strongly urge them to listen to 78% of New Yorkers, Governor Cuomo, and President Obama and pass legislation to raise the wage and help New York emerge from the devastation of the Great Recession," said Wright, sponsor of the Assembly minimum wage bill with Silver.

"Raising New York State's minimum wage will help provide people with a vehicle to escape poverty. It will create more opportunity for those people battling to make ends meet. We must include a provision that indexes the minimum wage to inflation to ensure that this problem does not come back every couple years," said Heastie.

The report also shows that boosting the minimum wage will have a positive effect on the economy. States that have enacted minimum wages above the federal rate have experienced higher rates of growth in companies, job creation and payroll. Low-wage workers are likely to spend extra earnings immediately on basic needs or services. They support their families by spending their income at businesses located closest to home, in their communities.

Corporate profits of low-wage employers are experiencing record growth. "The 50 largest employers of low-wage workers have largely recovered from the recession and most are in strong financial positions. As corporate profits of low-wage employers continue to grow, the wages of hard-working families are constantly being eroded by skyrocketing costs for rent, groceries, child care and insurance," said Silver.

The Assembly Majority recently amended the minimum wage legislation to $9 an hour to conform to President Obama's proposal for an increase in the federal minimum wage. The bill indexes the minimum wage to ensure earnings rise with the cost of living.

The legislation calls for the minimum wage to increase to $9 an hour in January of 2014. Beginning in 2015, the minimum wage will be indexed, requiring an increase each year to adjust for inflation according to the Consumer Price Index (CPI). The measure will also set wages for food service workers who receive tips at $6.21.

The District of Columbia, Massachusetts, Connecticut, Vermont and 16 other states have higher minimum wage rates than New York State.

Ten other states have passed legislation indexing the minimum wage. Hardworking families are consistently dealing with a steady rise in the cost of living for health care, higher education, housing, gas, groceries, utility bills or childcare. Families should be able to rely on a basic increase in their pay each year to keep pace with rising expenses.