Last week after President Barack Obama proposed increasing the minimum wage to $9/hour, local residents debated the idea.
Some argued that now is not the time to raise it because the economy is still fragile. Others said that increasing the minimum wage would help spur economic growth.
The debate may be moot, though, because research shows that minimum wage is no longer connected to employment levels.
Click hereto read the entire report from the Center for Economic Policy and Research.
According to a 2012 study-if minimum wage kept up with increases in worker productivity-it should be $21.72 an hour, The Huffington Post reported.
Last year, it would have been $16.54, according to the Center for Economic Policy and Research.
Dean Baker and Will Kimball with the Center for Economic Policy and Research said in a blog postlast week that minimum wage has not kept pace with worker productivity in the past 44 years, as it did between 1947 and 1969, which was a period of economic growth.
“The purchasing power of the minimum wage peaked in the late 1960s at $9.22 an hour in 2012 dollars. That is almost $2 above the current level of $7.25 an hour,” according to the blog.
But now, modest increases in minimum wage have little impact on employment, according to leaders with the center.
The link between increased productivity and minimum wage ended in the ’70s.
“This is one of the most studied topics in economics, and the evidence is clear: Modest minimum-wage increases don’t have much impact on employment,” Schmitt said. “An increase to $9 per hour would be hugely important for the workers getting it, but the idea that this would lead to less employment is just not supported by the evidence.”