It took less than a day after Oregon’s governor signed one of the nation’s largest minimum wage hikes into law for activists to complain that it’s not enough – and to begin pushing for further wage mandates to be included on the state’s ballot in November.
The newly signed law will raise Oregon’s minimum wage from the current level of $9.25 per hour to $14.75 per hour in cities like Portland. Smaller cities will have a minimum wage of $13.50 and “rural areas” will have the minimum wage set at $12.50. The increases will be phased-in over the next six years, with the first increases taking effect in July.
In a statement, Democratic Gov. Kate Brown said the phase-in approach provides “a path forward – so working families can catch up, and businesses have time to plan for the increase.”
Activists who pushed for the minimum wage increase don’t see a good reason to give families and businesses that sort of time.
Justin Norton-Kertson, campaign manager for Oregonians for 15, told KUTU-TV that the new law was “too low and too slow.”
Oregonians for 15 is pushing ahead with a plan to increase the statewide minimum wage to $15 per hour in three years. They hope to have that proposal on the ballot in November.
“It’s definitely a victory in its own right but, you know, it’s not what we’ve been fighting for,” Norton-Kertson said of the new state law. “Fifteen dollars an hour is really the bare minimum that a family needs without relying on government assistance.”
Since 2013, minimum wage increases have been approved by 18 states and the District of Columbia.
But, as the fight in Oregon shows, even states that have recently increased their minimum wages will not be immune from populist efforts to force businesses to pay higher wages. There are efforts underway in more than a dozen states to get minimum wage hikes onto the ballot in November or passed through state legislatures.
Massachusetts, California and Vermont have recently passed laws boosting hourly wages above $10. Minnesota and Oregon will join that group in the next few years, as both have passed laws to phase-in higher wages with small annual increases.
The fervor for higher minimum wages is likely to continue through this election year, with Democratic presidential candidates Hillary Clinton and Bernie Sanders pushing messages of income inequality. They are trying to follow in the footsteps of President Barack Obama, who called in 2013 for a $10.10 national minimum wage and issued a statement on Wednesday congratulating Oregon for going well beyond his proposal.
The Pew Research Center says about 75 percent of the public agrees, in theory at least, with raising the minimum wage. That all but guarantees that politicians will continue to talk about it.
All those increases are giving economists some serious economic data to crunch. The results so far suggest that higher minimum wages come with some unhealthy unintended consequences.
Six major cities that hiked minimum wages to $10 or more during 2015 are showing signs of economic weakness, according to data published last month in Investor’s Business Daily.
Chicago, which passed a $10 minimum wage last year, and San Francisco, which upped its minimum wage to $12.25, are witnessing five-year lows for employment in economic sectors like leisure and hospitality — areas with a high number of minimum wage workers.
Los Angeles, which approved a $15.37 minimum wage for some businesses including hotels with more than 300 employees, saw a net decline in hospitality jobs while the rest of California saw a net increase.
The same evidence can be found in Washington, D.C., which last year implemented a new $10.50 minimum wage (set to increase to $11.50 this year). While restaurants in the city’s Maryland and Virginia suburbs gained 5,000 new jobs during 2015, restaurants within the city limit reported a contraction of 200 jobs.
Mark Perry, a professor of economics at the University of Michigan, pointed to the fact that D.C. restaurants actually gained jobs during the 2008 recession, while most other sectors of the economy were shedding them.
“While it might take more time to fully assess the impact, the preliminary evidence so far suggests that D.C.’s minimum wage law is having a negative effect on employment levels at the city’s restaurants,” said Perry.
It’s an experiment that will continue playing out across the country.
Little more than two months into 2016, there have already been minimum wage ballot initiatives put forward in 12 states. Only one of those, in Maine, has so far accumulated enough support to qualify for the ballot.
The Maine proposal would raise the state’s minimum wage to $12 per hour by 2020.
Proposals in California, Minnesota and Missouri would match the Oregon activists’ plan for a $15 minimum wage, according to data from the Multistate Association.