Cities are now taking the lead— to increase the minimum wage

From an article in Maine Insights by Ramona du Houx

Bangor, Maine is considering an increase in the minimum wage proposed by former Mayor Joe Baldacci.

Bangor, Maine is considering an increase in the minimum wage proposed by former Mayor Joe Baldacci.

On June 2, 2014, the City Council of Seattle, Washington, passed a local ordinance to increase the minimum wage of the city to $15 an hour. As of 2015, Los Angeles, San Francisco, Chicago, and Oakland, California, have approved increases, in the case of Los Angeles to $15 an hour by 2020.

• Twenty-two cities nationally have created their own minimum wage, according to the National Employment Law Project, a New York City nonprofit.

• A 2013 Center for Economic and Policy Research (CEPR) review of multiple studies since 2000 indicated that there was “little or no employment response to modest increases in the minimum wage.”

• Another CEPR study in 2014 found that job creation within the United States is faster within states that raised their minimum wage. In 2014, the state with the highest minimum wage in the nation, Washington, exceeded the national average for job growth.

• The CEPR study indicated 11 reasons for this finding, including high reductions in labor turnover and vast improvements in organizational efficiency.

• The nonpartisan Economic Policy Institute (EPI) projects that if the minimum wage rises from $8 to $9, everyone currently earning $9 would be bumped up to $10, as employers adjust their pay scales.

• The Economist, not know for progressive views, wrote in December 2013, “A minimum wage, providing it is not set too high, could thus boost pay with no ill effects on jobs.”

There are various proposals to increase the minimum wage in Maine cities.

City Councilor Joe Baldacci speaking, at a town hall he hosted, about his proposal to raise the minimum wage for Bangor. Photo by Jeff Kirlin

City Councilor Joe Baldacci speaking, at a town hall he hosted, about his proposal to raise the minimum wage for Bangor. Photo by Jeff Kirlin

Last February Bangor City Councilor Joe Baldacci proposed a local ordinance that would incrementally increase the minimum wage in the city, beginning with a bump to $8.25 per hour in 2016, advancing to $9 per hour in 2017, and going to $9.75 in 2018.

“Family incomes in Maine and across the country have been stagnant for too long. We need to focus on and promote policies that will help raise people’s incomes. Raising the minimum wage is a critical piece of that effort,” said City Councilor Joe Baldacci.

This spring he hosted a Minimum Wage forum at Abraham Lincoln School, followed by appearances in Machias and Belfast, where he discussed the issue with citizens. Currently Baldacci is scheduling spaghetti dinners, where he will continue the discussion throughout the Second District.

“The people who work at minimum wage or near minimum wage, they are not asking for a handout,” said Baldacci. “There is no better issue that says that we want to reward work over welfare than raising the minimum wage.”

Over 100 attended his forum in Bangor, where he invited a guest panel who spoke on raising the minimum wage. They included: Danato Tramuto, founder and CEO of Physicians Interactive; Jim Wellehan, owner of Lamey-Wellahan shoes; Jane Searles of the Maine Center for Women, Work and Community; Christy Daggett of the Maine Center for Economic Policy; and former Governor John Baldacci.

A detailed 2014 study in California showed that raising the minimum wage has numerous public health benefits, not the least of which is more access to health care. Tramuto pointed out that the health and wellbeing of the families of minimum-wage earners is at risk.

“$2.00/hr increase in minimum wage, would have afforded that simple luxury of having a bus ticket.. Instead, I made the 2 mile trek, one way, to work every day,” said Melissa L Connors. Photo by Jeff Kirlin

Melissa Connors, a full-time, college educated, minimum-wage worker who attended the forum said, “This coat that I am wearing tonight was a Christmas present, because I didn’t have money to be able to buy a decent coat. Nobody thinks two dollars and hour is going to make a difference, but it does.”

Panelist Todd Gabe, an economics professor at the University of Maine, said if the minimum wage increased from $7.50 to $9.75 per hour, 18 percent of workers in the Bangor metropolitan statistical area would be directly affected.

There would also be a positive ripple effect for Bangor’s economy, according to Councilor Joe Baldacci.

“It bumps up the wage structure,” said Baldacci. “An increase of just a dollar an hour would give working people $2,000 more per year. That would in turn be spent locally. People who make the minimum wage or near it are struggling to get by. They spend every penny they make in their local communities. Those extra dollars will help create other jobs and opportunities, as well as improve the heath of their families. It’s not only the right thing to do, but it’s also very good economics.”

With most of the economic recovery since the recession benefiting the highest wage earners, people earning a minimum wage have been drastically left behind, according to the Maine Center for Economic Policy (MCEP).

“The problem with the economy both at the state and the national level is not that American businesses are making insufficient profits,” said Christy Daggett of MCEP. “It’s that wages have stagnated for the median wage earners since the 1980s, and for the lowest wage earners in Maine have actually fallen behind.”

The Portland Green Independent Committee is currently collecting signatures for a citywide referendum in November to establish a mandatory livable wage of $15 an hour for the city.

Portland’s Mayor, Michael Brennan, initially proposed a minimum wage of $9.50 an hour starting July 1, 2015 and ending at $10.68 on Jan. 1, 2017 with indexing.

After a year of debate on the issue, during which lobbyists from the Portland Chamber of Commerce, the Maine Innkeepers Association and the Maine Restaurant Association tried to prevent a substantial wage increase, eliminate indexing, exclude young workers, and gut enforcement provisions, the council voted.

On July 5th, going against the city’s finance committee, the Portland City Council decided to create a minimum wage of $10.10 an hour that starts on January 1, 2016. The wage will rise to $10.68 an hour in 2017. A year later it will increase on July 1 at the same rate as the Consumer Price Index. The city council is widely expected to place the question on the November ballot.

Augusta City Councilor and former State Representative Anna Blodgett has proposed a minimum wage of $8.25 an hour with exceptions for small businesses with four or fewer employees and for restaurants.

Portland, Maine is considering raising the minimum wage with a proposal by Mayor Brennen.

Portland, Maine is considering raising the minimum wage with a proposal by Mayor Brennen.

And South Portland’s City Council has agreed the minimum wage must be raised.

While communities across the state are weighing the possibility of increasing wages, LePage tried to prevent cities and towns from enacting their own minimum wages. Last April he proposed a failed two-sentence bill, sponsored by Assistant Senate Majority Leader Andre Cushing, that read: “The State intends to occupy and preempt the entire field of legislation concerning the regulation of the minimum wage. Any existing or future order, ordinance, rule or regulation of any political subdivision of the state is void.”

“We have a tradition of local control in the state of Maine that is enshrined in our heritage—they tried to overturn that. We’re trying to raise people’s wages,” said City Councilor Baldacci.


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