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The Minimum Wage War Is Misguided

All jobs are not created equal.

Entry-level positions in many fields — and in particular the service industry — are an introduction to the workforce: A first step at the start of a career, or perhaps re-starting at a later point in life.

Minimum wage coincides with minimal qualifications and minimal skills. But that’s not a knock on Americans at the first rung of the economic ladder. It’s a simple lesson in the value of labor — the more people in the workforce who can perform a given job, the less monetary value we assign to that particular job.

The rhetoric on both sides of the debate — holding the line and maintaining status quo versus pushing through to a “living wage” of $15 an hour more — needs a reality check.

Frontline food service and retail workers, of course, are critical. So too are other entry level positions across many industries. Without them their employers would be unable to function, as the quality of service would deteriorate and ultimately collapse.

The values we assign those jobs aren’t a judgment on the quality and character of the worker. It’s a function of how easy or difficult it is to fill them with competent people.

The notion that all work should be able to support a household or family is unrealistic. The idea we must fight is the “dead-end” job. Every opportunity to be a part of the economy — at even a minimal skill level — should be seen as an opportunity to learn, be productive, develop ambition and seek advancement.

Most service industries that offer lower-wage entry level positions also offer vertical advancement opportunities. Staying in one job with no ambition for advancement is not a good life plan.

However, while a minimum wage job can’t be counted on to support a household, the compensation must better reflect the cost of living and value of labor. Both factors have increased, and so it makes sense that market-sensitive increases to the minimum wage be considered.

President Obama threw down the gauntlet and challenged the nation to address the minimum wage issue during his State of the Union address earlier this year. More than ten months later, in the aftermath of the government shutdown and debt ceiling crisis, the issue seemed to have been all but forgotten, until the president, last week, challenged Congress and the U.S. to tackle the growing epidemic of income inequality by raising the minimum wage at the federal level from $7.25 to $10.00 an hour.

In many states – including Massachusetts - welfare pays more to an adult and family than minimum wage (with all benefits included). That disincentive to work is troubling and destructive to the future growth of the economy. More than 70 percent of Americans support an increase in the federal minimum wage.

Minimum wage earners make less than $15,000 a year. That simply does not reflect the true value of labor in America today. There is a middle ground between creating more pay equity for low-wage workers and not reaching a tipping point where a dramatically higher minimum wage causes mass job cuts.

As is often the case, some states are already leading the way in bringing about sensible change.

At the Massachusetts State House, legislators have the opportunity to tackle this issue head on by supporting legislation that would raise the state’s minimum wage — currently set at $8 an hour — to $11 an hour by January 2016 and tie future increases to inflation. That move to institute the highest minimum wage in the nation could establish a benchmark for others to align with.

Already, California will see its minimum wage rise from $8 to $9 an hour in July 2014, and then to $10 an hour in 2016 and no fewer than half a dozen states are on the brink of pushing minimum wage hikes through ballot or other initiatives in 2014.

Every opportunity to be a part of the economy — at even a minimal skill level — should be seen as an opportunity to learn, be productive, develop ambition and seek advancement.

The rhetoric on both sides of the debate — holding the line and maintaining status quo versus pushing through to a “living wage” of $15 an hour more — needs a reality check.

Businesses are under pressure from all sides: materials, insurance, fuel, labor costs, and of course, taxes. A modest and reasonable minimum wage increase will bring more pay equity to the labor force and better reflect the value of these entry level jobs. It will not force an entire sector of the economy like service and retail to slash thousands of workers.

But people entering or re-entering the workforce with limited marketable skills need to recognize that entry-level jobs are just that. Building a livelihood upon which a household can be supported requires ambition and the desire to improve one’s skills and marketability.

Ambition creates opportunity — two things upon which Massachusetts has always placed the highest value.


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This program aired on December 10, 2013. The audio for this program is not available.

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