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Newtown, CT, USA
Newtown, CT, USA
Newtown, CT, USA
Newtown, CT, USA
Editorials

The Minimal Effect Of The Minimum Wage Hike

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There are two ways to look at the recent move by Governor Dannel P. Malloy and the legislature to increase in the state’s minimum wage. It is either a lifeline for those living on the margins of the state’s economy or a rope too short to pull struggling families out of economic hardship and stress.

On January 1, the lowest rate in Connecticut for most hourly wage earners increased from $8.70 to $9.15 an hour. The new minimum wage law will also allow for incremental increases over the next two years, culminating in a minimum wage of $10.10 per hour for workers who punch the clock. The increase, according to the governor, will ensure that “no one who works full time lives in poverty.”

On the other hand, even when the hourly minimum wage reaches its apex in January 2017, it will still leave workers with their heads barely above the poverty line.

According to a 121-page report issued by United Way of Connecticut this past November, 51 percent of Connecticut wage earners earn less than $20 per hour, or $40,000 a year, full time. Those working poor are what the United Way report called the Asset Limited, Income Constrained, Employed, or ALICE population. What is referred to in the ALICE report as the Household Survival Budget suggests that in Newtown, where 15 percent of households fall below the ALICE threshold, a single adult would need to earn at least $10.32 per hour, full time, to afford the essentials of life. A family of four needs full-time employment totaling an hourly wage of $31.80 per hour.

Gov Malloy, Lieutenant Governor Nancy Wyman, and Connecticut Labor Commissioner Sharon M. Palmer all point to the 45-cent per hour increase in earnings as a boost to Connecticut’s economy, as well as lifting people out of poverty. In reality, a minimum wage employee would have to work four hours before the differential between the old and new rates would buy a single cup of coffee. It seems an incremental and insufficient way to grow the economy or to improve the quality of life of low-wage workers in any substantive way.

Without breaking the backs of small businesses that are vital to our towns and cities, how do we improve the lives of those people working one full-time job, and sometimes additional part-time jobs? It is a question that is not easily answered. A minimum wage increase is a good thing. But keeping Connecticut’s poorest families neck deep in the undertow of poverty is not an acceptable answer.

The underlying problems that make life barely livable for a large population in our state must also be addressed: inadequate health care, lack of decent and safe child care, educational opportunities that remain unaffordable for many, and limited job opportunities. Only when combined with progress toward these goals, will incremental minimum wage increases become a true lifeline for the poor and working poor seeking not only survival but better lives.

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