New Hampshire needs to care about its lowest paid workers. On January 19, 2023, an article by Adam Sexton reported that New Hampshire State Representative Kris Schultz was sponsoring a bill that planned to raise the state minimum wage from $7.25 an hour to $13.25 an hour and further increase it to $15 by 2025. If the bill passed, the N.H. minimum wage increase would have been enacted in September. The bill neither passed nor received substantial coverage. However, with the “Raise the Wage Act” gaining more traction and coverage recently, debates over whether theminimum wage should be increased have been reignited.
The “Raise the Wage Act” aims to increase the federal minimum wage to $17 an hour by 2028, according to Kathryn Carley of Public News Service. On top of raising the minimum wage for “service workers,” the bill would also increase the minimum wage for tipped workers who make below a certain amount per hour. The act was introduced to the House of Representatives on July 25, 2023, according to the Economic Policy Institute (EPI).
The minimum wage was first introduced during the Great Depression by former President Franklin D. Roosevelt in conjunction with Congress. According to Cornell Law School’s Legal Information Institute, the minimum wage was, “…designed to create a minimum standard of living to protect the health and well-being of employees.” In other words, its purpose is to ensure that the lowest paid workers are able to afford the cost of living.
According to the U.S Department of Labor History, the federal minimum wage has not increased since Jul 24, 2009, with a raise of $6.55 to $7.25 an hour. As of 2023, EPI reports that 30 states have raised the minimum wage beyond the federal minimum. CNN reported that as of January 1, 2023, 20 states further increased the minimum wage. New Hampshire is behind the curve, and regardless of whether the “Raise the Wage Act” passes, representatives need to endorse and push for legislation aiming to protect the lowest paid workers and make sure they can meet the cost of living.
According to the New Hampshire Economic and Labor Market Bureau, 11,000 people in N.H. “currently make minimum wage or less.” If one works 40 hours a week, they would only receive $290 a week before taxes. This is not enough and quite frankly is embarrassing. According to livingcost.org, the cost of living in N.H. is on average $2,254 a month for one person. Before taxes, a 40-hour work week on a minimum wage salary would be around $1,260 a month. It is not even close.
Arguments, specifically in N.H., against raising the minimum wage primarily stem from small business owners, who are worried that increased minimum pay would lead to job cuts and inflation, according to Sexton. While by no means do I think I am able to perfectly predict the effects it would cause on inflation in the N.H. economy, neighboring state Massachuesetts can provide a case study. U.S. Department of Labor reports that since 2009, Mass. has raised its minimum wage from $8 to $15 an hour. Specifically from 2022 to 2023, the minimum increased from $14.25 to $15 an hour, a 5% increase. The U.S Bureau Labor Statistics reported that inflation in Boston, Mass., has decreased from an average of 7.21% in 2022 to an average of 3.41% so far this year, a difference of 3.8% and a 47% decrease. The inflation rates of Boston tend to match the general trend of federal inflation, which dropped from an average of 8.2% to 3.7% from 2022 to 2023. On top of no short term mass inflation, USBLS have reported a steady decrease of unemployment percentages in Massachusetts since the spike of 16.9% in April 2020 which was a result of COVID-19 lockdowns. The current unemployment rate is the lowest seen in Mass. since well before 2003, at 2.6% as of August. This is down from a rate of 3.5% in January, which is when the new minimum wage was implemented.
When looking at the inflation and unemployment rates in Mass., a state we share a border with, raising the minimum wage has not correlated to the scary increase in inflation and unemployment that many have prophesied. The statistics show the exact opposite.
I am not an economist, but the trends we see in Mass. support the idea that trying to provide people with a livable wage does not wreck the economy, but appears to help it.
Raising the minimum wage is an important step to creating a social safety net, especially among people of color and women, who are more likely to make minimum wage than their white male counterparts. Let’s pay people enough to live comfortably and support their families!
Harvie Marcotti can be contacted at
hmarcotti@kscequinox.com
