U.S. Sen. Sherrod Brown touted the benefits of raising the federal minimum wage on Tuesday and said low-income people are struggling to make ends meet across the county.
Mr. Brown (D., Ohio) was stumping in Bowling Green for the Fair Minimum Wage Act of 2013, which would raise minimum wage from $7.25 to $10.10 an hour. The act also would provide cost-of-living increases, as well as increase the base wage for people working jobs in which they get tips.
“No reasonable study shows that it costs jobs,” Mr. Brown said of raising the minimum wage. He said adults — who make up 80 percent of the people who make the minimum wage — would benefit from a higher standard of living.
If low-income workers earn more money, they will pump some of that cash back into the economy, which will benefit everyone, Mr. Brown said at the Grounds for Thought bookstore and coffee shop.
The act would bolster the federal minimum wage by 2015 with three 95-cent increases. It also would allow minimum wage to keep pace with the cost of living after 2016 and raise the minimum wage for tipped employees — which has stayed at $2.13 for more than 20 years — to 70 percent of the overall minimum wage.
Inviting Mr. Brown to speak at Grounds for Thought was important because the minimum wage should be raised, and it's an issue that should be discussed in communities, said co-owner Kelly Wicks. Small businesses should compensate their employees so they can more easily afford something as simple as driving to work, he said.
“The role of a coffee shop in a community has been to create social discourse,” Mr. Wicks said.
Carrie Day, who works two part-time jobs, said she's only able to survive because of tips and artwork she sells on the side. Raising two children, paying for baby sitters, and paying off bills each month would be easier if she made more money.
“If we made more, we could do more,” said Ms. Day, who works in Bowling Green and Perrysburg.
Gary Burtless, a labor economist for the Brookings Institution, a Washington-based think tank, said public opinion polls show that most Americans agree with raising the federal minimum wage, and most businesses wouldn't feel a negative effect if the act is passed by Congress.
Boosting wages for low-income employees, most likely would have little effect on the overall economy, Mr. Burtless said.
“The proportionate gain in earnings would offset the loss in employment,” Mr. Burtless said.
The first 95-cent increase would have little effect in Ohio because the state's minimum wage is $7.85 in most instances, and $7.25 for smaller businesses. Michigan's minimum wage is $7.40.
The U.S. Chamber of Commerce opposes raising the federal minimum wage because it believes the increase could hurt small-business owners. The chamber released a statement expressing concern that businesses might have to trim profit margins to keep up with the increased cost of labor.
The chamber also worried about keeping the minimum wage on pace with inflation, stating: "Employers will likely be faced with automatically increasing labor costs without an automatic increase in revenues or profits."
Mr. Burtless said some businesses that rely on minimum-wage work could be adversely affected by the increase but companies that employ minimum-wage workers usually compete with one another. They wouldn't be put out of business by the increase, he added.
“Since all of them face the same change, they are not at a competitive disadvantage,” Mr. Burtless said.
By Kris Turner - The Blade, Toledo (MCT)
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