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By Ben Schaefer

Is a minimum wage hike picking up interest? While the minimum wage has long been an ebb-and-flow topic in the halls of Congress and statehouses around the country, it has picked up steam recently with the president’s signature of an Executive Order that raises the minimum wage to $10.10 per hour on new federal contracts beginning in January 2015. It would increase in subsequent years by an amount tied to inflation and approved by the secretary of Labor. Further, it increases the wage for tipped workers on federal contracts to $4.90 per hour in 2015 and is increased in subsequent years until it reaches 70 percent of the non-tipped level. 

Want adsIt was a focal point of President Obama’s recent State of the Union address and the center of countless news articles, political talk show segments, and water cooler discussions. The minimum wage debate is back for the time being.

Senator Tom Harkin (D-IA) and Representative George Miller (D-CA) have introduced identical legislation in their respective chambers that would also raise the wage to this level, but with a two year phase-in period built into the bill. It also includes a lower initial raise (to $3 per hour) for tipped workers. The measures, however, have largely been stalled since their introductions in March of last year. 

The debate over whether raising the minimum wage ultimately helps or hurts the economy overall continues, with a recent Congressional Budget Office report adding fuel to the fire. The report finds that raising the wage to $10.10 would result in about 500,000 fewer jobs created between now and 2016 than if left at its current level. At the same time, CBO notes that a few tens of thousands of jobs would also likely be created due to increased income and the expected increase in market demand that would follow.

With congressional action becoming more unlikely, the debate over costs and benefits rages on and states are taking it upon themselves to reassess their minimum wage laws. NCSL finds that legislation addressing the minimum wage in some form has been introduced in 30 states and the District of Columbia; in 28 of the 30 states, the legislation would increase the wage (with Delaware and DC already having passed legislation).

As the political wrangling continues at both the state and national levels, one thing seems certain: The minimum wage is an issue that is here to stay.

Ben Schaefer is a policy associate in NCSL's State-Federal Relations division.

Posted in: Public Policy
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This blog offers updates on the National Conference of State Legislatures' research and training, the latest on federalism and the state legislative institution, and posts about state legislators and legislative staff. The blog is edited by NCSL staff and written primarily by NCSL's experts on public policy and the state legislative institution.

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