The Minimum Wage

Floor Speech

Mr. DURBIN. Mr. President, 4 years ago today, the Federal minimum wage increased to $7.25 per hour. That was the final phase of a minimum wage increase that Congress passed in 2007. After 4 years, it is time to evaluate where wages stand.

Since 1967, the Federal minimum wage has increased from $1.40 to $7.25. While at first glance this seems like significant progress, when adjusted to current dollars the value of the minimum wage has actually declined by 12.1 percent. Had the minimum wage kept pace with inflation, it would be $10.74 an hour today.

But the minimum wage for tipped workers is even worse. The current minimum wage for tipped workers is $2.13, and that has not gone up since 1991. Employers paying the tipped minimum wage now pay just 21 percent of what that employee would make at minimum wage. This forces workers to use more and more of their tips simply to make up the difference between the tipped minimum wage and the standard minimum wage.

Working 40 hours per week at $7.25 per hour translates to just $15,080 per year. That's about $400 less than the Federal poverty level guidelines for a family of two. Last week, The Atlantic ran an article that showed a budget chart produced by McDonald's to help its employees better manage their finances. And while I commend McDonald's for trying to help workers better manage money, the budget tells a sad story.

According to the chart, someone making the minimum wage and working 40 hours a week at McDonald's would have to work a second job to make ends meet. But to be clear for this budget to be accurate, a worker must hold nearly two full time jobs. According to the Washington Post's Wonkblog, a worker making the minimum wage would to have work 75 hours a week to have the after-tax income in the McDonalds sample budget. Working 75 hours a week at minimum wage with no vacation days and limited benefits--if any--one can make $24,720 a year, after tax.

How does a person do that if they are a single parent? They can't. There are not enough hours in the day to raise a family working that many hours. And there certainly aren't enough dollars in the income to provide child care.

The sample budget drawn up for McDonald's employees might as well include a line for Federal and State assistance. Families living on the minimum wage have few alternatives but to turn to programs such as SNAP, housings assistance, and Medicaid to survive. These are the same programs that are regularly attacked by the ultra-conservative for growing too quickly. For those who insist that working be a requirement for receiving public assistance, shouldn't they also insist that if you are working full time you shouldn't need public assistance? Wouldn't that be a good definition of a minimum wage?

If we increase the minimum wage to $10.10, more than 30 million workers would receive a raise. And while some of these workers are teenagers, 88 percent are adults. For many of those adults, these are not part time jobs or stepping stones to their next job, but the full time job they rely on for a living.

That is why 4 years after the last minimum wage increase, it is time to act again. I am a cosponsor of the Fair Minimum Wage Act introduced by Senator Harkin in the Senate and Representative George Miller in the House. The Fair Minimum Wage Act will increase the minimum wage from $7.25 to $10.10 per hour in three, 95-cent annual increments, and index it to inflation annually thereafter. The bill will also gradually raise the minimum wage for tipped workers from the current $2.13 per hour to a level that is 70% of the regular minimum wage.

If we pass the Fair Minimum Wage Act that same full-time worker being paid minimum wage I mentioned earlier that makes $15,080 a year--will make $21,000. That can be the difference for a family that is getting by and one that is living in poverty. I hope my colleagues on both sides of the aisle will join me in cosponsoring the Fair Minimum Wage Act.

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