Should Christians be “All In” for the Minimum Wage Increases?

Recently, the Bureau of Labor Statistics (BLS) produced a report on the “Characteristics of Minimum Wage Workers” for 2014. Of all 77.2 million hourly workers, less than one in twenty-five earns the minimum wage. Since this data was first collected 35 years ago, the number earning minimum wage has gone down from the 13.4% in 1979 to 3.9% in 2014.

See full report: http://www.bls.gov/opub/reports/cps/characteristics-of-minimum-wage-workers-2014.pdf
Of the 3.9% minimum wage earners, over half were teenagers, mostly females, most working part-time in low paying service industries, and in low cost of living states and rural areas.

The federal minimum wage was 25 cents in 1938 when it became law. Adjusted for inflation, that would be worth $4.13 today. Below are minimum wages for the last 35 years when this report was first conducted:

Federal Minimum Wage            Effective date
$2.90                                           January 1, 1979
$3.10                                           January 1, 1980
$3.35                                           January 1, 1981
$3.80                                           April 1, 1990
$4.25                                           April 1, 1991
$4.75                                           Oct. 1, 1996
$5.15                                           Sept. 1, 1997
$5.85                                           July 24, 2007
$6.55                                           July 24, 2008
$7.25                                           July 24, 2009

During the 35-year time period, over 50 million new jobs were created as the economy and population grew. But the value of the minimum wage has not kept up with inflation, decreasing by almost 30% as measured by the CPI (Consumer Price Index). [1]

Many well-meaning people think the minimum wage should be increased, and substantially; many Christians believe it is moral or even Biblical to support this view. Others believe that a minimum wage set freely by agreement between employer and employee is best in a free society, and supports human dignity. For those with few or no skills and lack education, the minimum wage may be a barrier to gaining the experience and developing the abilities needed to advance. Some will never have a starting point or the opportunity to gain basic skills or further training which would allow them to move beyond the minimum wage. The minimum wage is not a living wage but, as the data has shown, very few states and jurisdictions are attempting to use it as such. It is unrealistic to think that a minimum wage can ever equal a living wage even if society could agree to what that number would be.

Over 50 years ago, in “Newsweek” magazine, Milton Freidman (1966) predicted:

• Raising the minimum wage will increase minority, teen, and women’s unemployment.
• Machinery will be used to replace humans in the workplace and prices will increase throughout the economy.
• Those that will be hurt the most will be the very poor, low paid, and unskilled in our society. [2]

It appears that Friedman may have been correct in his predictions.

Questions for Reflection
• How does the Bible inform your understanding for what stance should be taken on minimum wage?
• Does it matter that the federal minimum wage equates to annual earnings that fall below the established U.S. poverty lines for single-earner households with two or more persons?
• If raising the minimum wage is not the ultimate answer for helping to raise people out of poverty, what is?

Update for 2016 per the National Conference of State Legislators:
14 states begin the new year with higher minimum wages. Of those, 12 states increased their rates through legislation passed in the 2014 or 2015 sessions, while two states automatically increased their rates based on the cost of living. [3]


[1] State or U.S. jurisdiction minimum wages may differ from the federal minimum wage. They may be set higher, lower, the same, or with no minimum wage level, with the highest level required to be paid. Go to the map Minimum Wage Laws in the States – January 1, 2016 and click on specific states or jurisdictions to learn about the minimum wage laws.

[2] There are three different forms of wages: minimum wage, prevailing wage, and living wage. To learn more, read the Society for Human Resource Management (2012) article: Minimum Wage: What is the Difference between Minimum Wage, Prevailing Wage and Living Wage, and to Whom Does Each Apply?

[3] National Conference of State Legislatures. (2016). State minimum wages. 2016 minimum wage by state. Retrieved from http://www.ncsl.org/research/labor-and-employment/state-minimum-wage-chart.aspx

2 comments

  1. Debbie Philpott

    As indicated by the blog title—”Should Christians be ‘All In’ for the Minimum Wage Increases?”—the question raised is asking whether Christians should support legislative movements to increase the federal minimum wage. One argument forwarded by Rabbi Michael Knopf (2014) in his Huffington Post comment suggests there is some biblical basis for supporting an increase. Knopf builds his argument on the foundation of the Torah, citing OT Scripture (e.g., Deuteronomy 24:14-15), and asserting that

    if a business owner earns enough to cover his or her expenses and provide for his or her family, he or she is not allowed to keep any additional profit until he or she has ensured that the basic needs of his or her employees are met. To pocket additional, and strictly unnecessary, income, while one’s employees cannot put food on their tables or a roof over their heads is, to me, the very definition of profiting at the expense of others’ wellbeing.

    From this, we learn that employers, unless they themselves cannot make ends meet, have an obligation to pay their workers at least enough to enable them to provide for their basic needs. If they do not, they are, in the biblical view, guilty of profiting by their workers’ blood. [1]

    Knopf goes on to suggest that responsibility for meeting the basic needs of employees is specially weighted on the shoulders of larger employers, such as Wal-Mart, whose owners have profited in the billions. It is an argument for which most Christians would likely agree. However what is not so clear are the answers to the following and similar questions: ‘What is the dollar value of basic needs?’ And, ‘Does the value of basic needs vary by geographic region in the US or is the amount the same no matter where one lives?’

    Without doubt, the Bible has made it clear—throughout the OT and NT—those who serve the One true and living God have a responsibility to the poor and the marginalized in society. Jesus spoke of this topic often, and when speaking of the day of judgement he said of the “goats” that they were guilty of not giving drink to the thirsty, food to the hungry, clothing to the naked, not visiting the sick or those in jail, or offering hospitality to strangers or immigrants (Matthew 25:31-46). Yet, what is equally striking in biblical text is that responsibility for the poor does not necessarily rest with government, but with the individual and Christ’s Church. So, while there may be a moral and ethical responsibility for adequately supporting the livelihood of employees, it is questionable whether meeting the basic needs of the poor should be a legislated matter via an increase in the minimum wage.

    [1] Knopf, M. (2014, February 18). A biblical case for raising the minimum wage. Retrieved from http://www.huffingtonpost.com/rabbi-michael-knopf/a-biblical-case-for-raisi_b_4804908.html

    Reply
  2. Dele Omosegbon

    Good punch lines on the minimum wage debate, Jim!

    I have a short response on two of those punch lines:

    1. “It is unrealistic to think that a minimum wage can ever equal a living wage even if society could agree to what that number would be.” I am not sure why you say this. You are assuming that minimum wage and living wage form a binary variable. Who decrees it, that a minimum wage and a living wage cannot be one and the same thing? Apparently, you had in mind affordability. To this must be joined the essence of work, especially for those who earn very low wages for a living, by which I am not referencing the inexperienced youth and students but adult workers 16 years and older, who work on minimum wage or less jobs. If gross wages are not enough to afford what any society deems minimum decency, then, one wonders why we have government at all.

    2. “It appears that Friedman may have been correct in his predictions.” Evidence? Professor Friedman might have been more theoretical than you imagined. Evidence from Seattle among other locations, where the minimum wage is way above Federal rate, is often cited that raising minimum wage may not hurt the labor force, after all. ” Machinery will be used to replace humans in the workplace and prices will increase throughout the economy.” It turns out that technological progress and increased used of robots had nothing to do with increases in the minimum wage. Increased use of machines to replace humans in the work place promotes productivity and if capitalism is working well, technological change is expected to stimulate the creation of new jobs for those displaced. Of course, the predictions of price increases of off the mark. We have been, in fact, in fear of deflation not inflation, in recent years!

    Reply

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