Corporate-backed Groups Fight Against Minimum Wage Increases

NALC Legislative and Political Action

According to an article in The American Prospect, fights are being waged by corporate-backed groups across the country against minimum-wage increases. Eight states are considering legislation this year to increase the minimum wage, including New York, Iowa and Connecticut. In large part, these proposals are in response to the fact that the federal minimum wage has not kept pace with inflation and that increases in the minimum wage enjoy broad public support.

In 1983, the federal minimum wage was $3.35 an hour and now it is $7.25, up 120 percent. However, during this time inflation has increased by 135 percent, and in fact, when adjusted for inflation, the minimum wage was much higher, at $10.34 an hour in 1968. Furthermore, a recent survey showed that two-thirds of Americans support increasing the minimum wage to at least $10 an hour.

As these battles are being waged, many corporate-backed organizations are pushing back against these efforts. One of the major organizations fighting against the increase in minimum wage is the corporate-backed think tank Employment Policies Institute, which argues that raising the minimum wage actually harms the working poor and minimum wage-earners, even though this argument seems counter-intuitive. The institute’s argument is that raising the minimum wage kills jobs and prevents businesses from hiring more workers, particularly for small businesses. However, this argument has been proven to be untrue. A study released by the Economic Policy Institute showed that “states that raised the wage saw higher employment rates among businesses with 50 or fewer workers.”

The real goal of corporate front groups such as the Employment Policies Institute is to protect corporate profits at the expense of a small wage increase for working men and women.

Click here to read the article in The American Prospect.

Click here to read more about the state battles to increase the minimum wage.


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