In recent weeks the New York State Assembly has being heatedly debating the benefits and disadvantages of raising the minimum wage to $8.50 an hour. This increase would have minimum wage earners receiving over a dollar increase for an hour’s compensation. The state’s minimum wage rate is currently set at the federal minimum of $7.25.
Compared to the average cost of living in the United States, New Yorkers pay 124 percent more for groceries, health care, transportation, housing and utilities and general goods and services. Since New York State only matches the rates set by the Federal Minimum Wage Act of 2007, it is among the lowest in the country, tied with states such as Kansas, Kentucky and Iowa. These states, however, all fall below the national average for comparative living costs.
New York State Assembly Speaker Sheldon Silver and Assembly Labor Committee Chairman Keith Wright introduced legislation in January that would raise the minimum wage to $8.50 an hour, and index it according to the cost of living so that “wages don’t erode in the future.”
In an open letter to New Yokers, Speaker Silver pointed out that the minimum wage rate in New York has only increased 10 cents in the past five years. “The ladder to economic success has fallen in disrepair for too many New York families and our middle class is rapidly shrinking,” Siler wrote in the letter. Raise The Wage NY, the page where the letter is posted, also includes a petition, wage map and details page that highlights the major elements of the bill.
"It is absurd to expect anyone to afford the cost of living today and be able to invest in their future on a pay rate of $7.25 an hour. That is why it is my top priority this legislative session to repair the ladder to success, to make an investment in our working families and ensure that they can continue to do so as the cost of living continues to rise,” Speaker Sheldon said in January, noting that addressing inequalities in the pay scale was a crucial aspect of instilling fairness in New York’s tax code. The legislation would have the wage increase take effect in January of 2013, and would also raise the hourly compensation of food service workers who receive tips to $5.86.
Assemblyman Wright said that nearly half of all Americans have fallen into poverty or have become the “working poor.” “This is not the American Dream,” said Wright. “New Yorker's who work full time, shouldn't be poor. It's as simple as that!” Eighteen other states, including Massachsettes, Connecticut and Vermont, as well as Washington D.C., have higher minimum wage rates than New York.
Mario Cilento, the president of NYS AFL-CIO, has supported Siler and Wright’s legislation to support working New Yorkers. “It will benefit both workers and our state economy, as this money will be spent right back in our local communities...With this bill, we have the opportunity to make a real positive change in people’s lives.”
Not everyone is in agreement over the measure. Jan Marie Chesterson of the New York State Hospitality & Tourism Association spoke at a Senate hearing in late April against raising minimum wage. “Increasing minimum-wage requirements could force small businesses that can’t afford the increase to simply find ways to avoid doing so,” Chesterson said. Others argue that the Employment Policies Institute statistics show that a majority of minimum wages earners are teenagers or dependents who actually live in multiple-income households that fall well above the poverty line, and the EPI has argued there is little “little evidence that raising the minimum wage has been effective in reducing poverty.”
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