Raise the state minimum wage from $5.15 to $6.50 an hour

Protect the right of local governments to establish living wage ordinances

STATES WITH MINIMUM WAGE HIGHER THAN FEDERAL
(Source: U.S. Department of Labor)
. Illinois $5.50
. Delaware $6.15
. District of Columbia $6.15
. Hawaii $6.25
. Maine $6.25
. California $6.75
. Massachusetts $6.75
. Rhode Island $6.75
. Vermont $6.75
. Oregon $7.05
. Connecticut $7.10
. Alaska $7.15
. Washington $7.16

About 190,000 Virginia workers would benefit from an increase in the state minimum wage from $5.15 to $6.50 per hour.(1) Approximately 48,000 Virginia hourly workers currently earn the minimum wage. Another 142,000 earn more than $5.15 but less than $6.50 per hour.(2)

The average minimum wage worker brings home more than half (54%) of his or her family's weekly earnings. (2)

Adults make up the largest share of workers who would benefit from a minimum wage increase: 68% of minimum wage workers are age 20 or older; 60% are women; more than 45% work at least 40 hours a week. (2)

The inflation-adjusted value of the minimum wage is 24% lower today than it was in 1979. The inflation-adjusted real value of the minimum wage fell to $4.75 in 2003. (2)

There is no evidence of job loss from the last national minimum wage increase (1996-97), or the Oregon state increase to $6.50 (1997-1999). Economic models of low-wage labor markets show that employers absorb some of the costs of a wage increase through higher productivity, lower turnover, lower recruiting and training costs, and lower absenteeism. (2)

Living wage ordinances require employers to pay wages that are above the federal or state minimum wage levels. Only a specific set of workers is covered by living wage ordinances, usually those employed by businesses under a service contract with a local government or businesses that receive a subsidy from a local government. Some local governments and public universities also enact living wage policies that cover direct employees.

The amount of the living wage set in local ordinances varies from locality to locality, and is usually set at an amount above the poverty level and adequate to sustain a modest standard of living based on the local cost of living.

The rationale for living wage ordinances and policies is that local governments wish to insure that taxpayer dollars are not used to pay wages below the poverty level. Local taxpayers thus have the assurance that local government wages and service contracts do not contribute to the local public and social costs of poverty in their communities --- such as homelessness and hunger.

In addition, local governments and taxpayers in competitive labor markets can reduce turnover, and thus recruitment and training costs, by retaining public employees and contract workers at wages sufficient to support modest living expenses in the local area. This increases efficiency and quality in public services provided by lower-wage employees and increases the pool of quality workers available to the local government.