top of page

Group

Public·93 members
Sebastian Kelly
Sebastian Kelly

Buying Power Of Minimum Wage __EXCLUSIVE__


Saturday marks 12 years since the last federal minimum wage increase on July 24, 2009, the longest period in U.S. history without an increase. In the meantime, rising costs of living have diminished the purchasing power of a minimum wage paycheck. A worker paid the federal minimum of $7.25 today effectively earns 21% less than what their counterpart earned 12 years ago, after adjusting for inflation.




buying power of minimum wage



As a result of Congressional inaction, over two dozen states and several cities have raised their minimum wage, including 11 states and the District of Columbia that have adopted a $15 minimum wage. These higher wage standards have increased the earnings of low-wage workers, with women in minimum wage-raising states seeing the largest pay increases. In the rest of the country, however, states have punished low-wage workers by refusing to raise pay standards. As many as 26 states have gone so far as to pass laws prohibiting local governments from raising their minimum wage.


A step in the right direction would be a $15 national minimum wage by 2025, as called for by the Raise the Wage Act of 2021. The policy would raise the wages of 32 million workers and increase the earnings of nearly one in three Black workers (31%) and one in four Hispanic workers (26%). It would also raise the wages of 19 million front-line and essential workers. By helping to ensure decent pay, a national $15 minimum wage by 2025 would lift up to 3.7 million people out of poverty, including 1.3 million children.


June 16th marks the longest period in history without an increase in the federal minimum wage. The last time Congress passed an increase was in May 2007, when it legislated that the minimum wage be raised to $7.25 per hour on July 24, 2009. Since the minimum wage was first established in 1938, Congress has never let it go unchanged for so long.


For the default policy shown here, the standard minimum wage reaches $15 per hour in 2027, four years after the first incremental increase. The subminimum wage for tipped workers reaches parity with the regular minimum wage two years later. After reaching their targets, both minimums are indexed to changes in median hourly wages.


Options for the target amount for the hourly minimum wage range from $10 to $15 (in $1 increments). The federal minimum wage would rise by varying amounts each year until it reached the target amount in the year specified for full implementation. For the default policy based on the Raise the Wage Act of 2021, the minimum wage would be $9.50 in 2023, $11.00 in 2024, $12.50 in 2025, $14.00 in 2026, and $15.00 in 2027 and would be indexed to changes in median wages thereafter.


Users of this interactive tool can leave the subminimum wage unchanged, increase it by varying amounts each year until it reaches 50 percent of the federal minimum wage, or increase it by varying amounts each year until it matches the federal minimum wage.


For the default policy based on the Raise the Wage Act of 2021, the subminimum wage would be $4.95 in 2023, $6.95 in 2024, $8.95 in 2025, $10.95 in 2026, $12.95 in 2027, $14.95 in 2028, and equal to the federal minimum wage thereafter.


Like previous increases in the minimum wage, the options presented here would take a number of years to be fully implemented. Users of this interactive tool can leave the minimum wage unchanged after the end of the phase-in period or change it in one of two ways.


Indexing the minimum wage means automatically adjusting it after it reaches the target amount. Past increases in the federal minimum wage have not been indexed, so the value of those increases has been eroded by inflation.


Historically, median hourly wages have grown faster than the CPI, and CBO expects that pattern to continue over the next 10 years (starting in 2023). As a consequence, indexing the minimum wage to median hourly wages would lead to slightly larger effects on employment, wages, and family income.


The federal minimum wage would rise by varying amounts each year until it reached the target amount in the year specified for full implementation. For the default policy based on the Raise the Wage Act of 2021, the minimum wage would be $9.50 in 2023, $11.00 in 2024, $12.50 in 2025, $14.00 in 2026, and $15.00 in 2027 and would be indexed to changes in median wages thereafter.


How would increasing the minimum wage affect employment? Raising the minimum wage would increase the cost of employing low-wage workers. As a result, some employers would employ fewer workers than they would have under a lower minimum wage. However, for certain workers or in some circumstances, employment could increase.


First, future wage growth under current law is uncertain. If wages grow faster than CBO projects, then wages in future years will be higher than CBO anticipates and increases in the federal minimum wage would have smaller effects. If wages grew more slowly than CBO projects, the effects would be larger.


Second, the responsiveness of employment to an increase in the minimum wage is uncertain. If employment is more responsive than CBO expects, then increases in the minimum wage would lead to larger declines in employment. By contrast, if employment is less responsive than CBO expects, the declines would be smaller. Findings in the research literature about how changes in the federal minimum wage affect employment vary widely. Many studies have found little or no effect, but many others have found substantial reductions in employment.


In The Budgetary Effects of the Raise the Wage Act of 2021, CBO estimated how an option for increasing the minimum wage to $15 would affect the federal budget. That analysis incorporated the effects of changes in macroeconomic factors, such as inflation and aggregate income.


This article illustrates how minimum wage levels vary across the European Union (EU) Member States; it also provides a comparison with the situation in the candidate countries and the United States.


Minimum wage statistics, as published by Eurostat, refer to national minimum wages. The national minimum wage usually applies to all employees, or at least to a large majority of employees in a country. It is enforced by law, often after consultation with social partners, or directly by a national inter-sectoral agreement.


National minimum wages are published by Eurostat bi-annually. They reflect the situation on 1 January and 1 July of each year. As a consequence, modifications to minimum wages introduced between these two dates are only shown for the following bi-annual release of data.


Among the seven candidate and potential candidate countries, five had a national minimum wage (Montenegro, North Macedonia, Albania, Serbia and Türkiye) which was not the case of Bosnia and Herzegovina nor Kosovo*.


Figure 2 compares gross minimum wages applicable on 1 January 2023, after adjusting them to price differences across countries. This is done by using purchasing power parities (PPPs) for household final consumption expenditure. As might be expected, this adjustment reduces differences across countries. In PPS terms, EU Member States with the national minimum wage may be classified into two different groups (see Figure 2, non-EU countries are shown separately).


All candidate and potential candidate countries with a national minimum wage would belong to group 2, with minimum wage levels ranging from PPS 460 in Albania to PPS 907 in Montenegro. The United States (PPS 920) would also fall within group 2.


On 1 January 2023, the highest minimum wage in euro (in Luxembourg) was almost 6 times the lowest one (in Bulgaria). When expressed in PPS, the highest (in Germany) was 2.6 times the lowest (in Bulgaria).


Figure 3 provides information on national minimum wages in proportion to median gross earnings, calculated with and without part-time employees. Data are published for reference year 2018, the last year for which earnings data are available, based on the Structure of Earning Survey (SES 2018).


National minimum wages expressed in euro, applicable on 1 July 2018, were divided by the median gross earnings measured from the Structure of Earning Survey (SES 2018). Within the EU, the resulting ratio ranged from 42 % (in Estonia) to 66 % (in France), part-time employees included.


In 2018, minimum wages represented over 60 % of the median gross earnings in only four Member States: France ( 66 %), Portugal ( 64 %), Slovenia (62 %) and Romania (61 %). The minimum wages ranged between 50 % and 60 % of the median gross earnings in eleven Member States: Bulgaria (59 %), Hungary (58 %), Luxembourg, the Netherlands and Poland (all 57 %), Ireland (53 %), Germany and Slovakia (both 52 %), Greece (51 %), followed by Belgium and Lithuania (both 50 %). In six Member States: Czechia, Croatia and Latvia (all 49 %), Spain (44 %), Malta (43 %) and Estonia (42 %), the minimum wages were less than half of the median earnings.


Note: For the purpose of this analysis, payments for overtime and shift work have been excluded from the calculation of median gross earnings. In the case of Germany, France and Ireland, whose minimum wages are set on an hourly basis, the ratio was calculated as a proportion of the median hourly earnings. For the other 18 EU Member states that have a national monthly minimum wage and for which data are available, the ratio was calculated as a proportion of the median monthly earnings.Median earnings were calculated with and without part-time workers (see Figure 3). When part-time workers are included in the calculation, their earnings are first converted into full-time equivalents. Including part-time workers had the largest impact on the minimum wage to median earnings ratios of: the Netherlands (+6 %), Germany (+5 %) and Greece (+4 %). 041b061a72


About

Welcome to the group! You can connect with other members, ge...

Members

  • Aiden Williams
    Aiden Williams
  • Eliana Russell
    Eliana Russell
  • Cannabis Weed
    Cannabis Weed
  • Score Cred10
    Score Cred10
Group Page: Groups_SingleGroup
bottom of page