Efforts to weaken Maine’s minimum wage are perennial objects of consideration in the Maine Legislature. Most often, lawmakers rejects these efforts out of hand — and for good reason. Previous legislatures have recognized that there is no evidence to suggest that Maine’s minimum wage is too high.
This year, Maine’s Legislature is once again being asked to consider several bills to change Maine’s minimum wage law. These bills — LDs 425, 612, 670, 739, 808, 830, and 1098 — take aim at the minimum wage protections for young workers, workers in rural regions, and workers at small businesses, or would eliminate the provision in Maine’s law to guarantee the minimum wage keeps up with inflation after it reaches $12 per hour next year.
The Legislature should reject each one, as they’ve done before.
Maine voters affirmed in 2016 that Maine’s minimum wage didn’t need to be cut. In fact, they said it needed to be expanded. Since the law to increase the minimum wage was enacted, MECEP has examined several data sets to assess the effect of the minimum wage increase.
All the evidence points to the same conclusion:[i] There have been no widespread negative impacts. Employment is up, unemployment rates remain at record lows. Mainers are working more hours and taking home bigger paychecks. The minimum wage contributed to the biggest decline in child poverty in more than a decade.[ii] Restaurants and the tourism industries are posting record profits and continuing to add locations and employees.[iii]
Simply put, there is no empirical reason that you should reduce wages for low-income Mainers by as much as $7,600 per year, as the most extreme of these bills would propose.
Each of the proposals before you would weaken Maine’s minimum wage:
- A reduced minimum wage for young workers would be unprecedented. Many teenagers work to help support their families, and they can no more control how old they are than their gender or race. MECEP estimates that one in five working Mainers under the age of 18 lives in or near poverty.[iv] For working Mainers under the age of 20, that proportion rises to one in four.[v] Cutting the minimum wage for these young people will have serious impacts on their families’ wellbeing.
- Workers shouldn’t earn less depending on what kind of business employs them. A Mainer who works for a small business still must make their rent or mortgage, put food on the table, and pay for doctor’s visits and prescriptions. MECEP estimates that 44 percent of Mainers making at or near the minimum wage work in businesses with fewer than 50 employees.[vi] Different minimum wages for different size businesses would set a dangerous precedent for reducing protections for workers based on conditions beyond their control. We must maintain the minimum wage as a solid floor under which no worker can fall, regardless of what kind of employment is available to them.
- Rural workers don’t deserve to make less than city workers. The cost of living does vary somewhat throughout Maine, but the differences are not substantial. Some costs, such as housing, may be lower in parts of the state, while others, such as health care, are higher. People in rural parts of the state spend more on gasoline because they commute longer distances to work. And they spend more to heat their homes in winter. Pushing down wages in parts of the state will only make life harder for rural Mainers and could exacerbate the flow of people from inland counties to southern Maine.
- The minimum wage should keep up with the cost of living. One reason the 2016 referendum was so badly needed was the failure of the minimum wage to keep pace with inflation. Without indexing, the minimum wage will be worth less every year. Mainers will have to stretch the same paycheck even further.
Legislators have heard reports of individual businesses that are struggling. But just as business plans are not simply a list of wages paid to workers, business success or failure is driven by many factors other than wages. If Maine’s minimum wage were the driving factor pushing businesses into the red, the data would show it. It does not. Instead, it shows us that Maine’s minimum wage law is working as intended. Tens of thousands of Mainers and their families are earning more, and our economy continues to grow and create jobs.
Maine’s elected lawmakers should not legislate by anecdote. They should reject any bill that would undermine our successful minimum wage, upon which tens of thousands of Mainers rely to make ends meet.
Notes:
[i] See James Myall, “Minimum Wage Increase Contributes to Largest Annual Wage Gain in 10 Years,” Maine Center for Economic Policy, Jan 8, 2018. Available at http://blog.mecep.org/2018/01/minimum-wage-increase-contributes-to-largest-annual-wage-gain-in-10-years/ and James Myall, “New Federal Wage Data Brings More Evidence For Success Of Maine’s New Minimum Wage Law,” Maine Center for Economic Policy, Jan 8, 2018. Available at https://www.mecep.org/new-federal-wage-data-brings-more-evidence-for-success-of-maines-new-minimum-wage-law/
[ii] James Myall, “Minimum Wage Increase Boosted Paychecks, Cut Child Poverty in 2017,” Maine Center for Economic Policy¸ Sept 24, 2018. Available at https://www.mecep.org/wp-content/uploads/2018/09/Minimum-Wage-Child-Poverty-092418.pdf
[iii] Dan Neuman, “Restaurant licenses, sales, jobs, wages and hours all up after Maine’s tipped wage hike,” Beacon, Mar 6, 2019. Available at http://mainebeacon.com/restaurant-licenses-sales-jobs-wages-and-hours-all-up-after-maines-tipped-wage-hike/
[iv] 22% of working Mainers under 18 lived in families with incomes up to 200% of the federal poverty level. MECEP analysis of US Census Bureau, American Community Survey, 2017 data.
[v] 27% of working Mainers under 20 lived in families with incomes up to 200% of the federal poverty level. MECEP analysis of US Census Bureau, American Community Survey, 2017 data.
[vi] MECEP analysis of US Census Bureau, Current Population Survey, Annual Social and Economic Supplement, 2016-2018 average. “At or near minimum wage workers” were defined as those whose equivalent hourly wages were below $13.75/hour in 2018 dollars.
