Increasing Ohio’s minimum wage from $8.15 to $15 an hour by 2025 would give 1.8 million Ohio workers a raise. This would boost the economy and help low-wage workers make up lost ground, according to a new report by Policy Matters Ohio.
While the Ohio economy has grown more than 65 percent in a generation, workers in the bottom 30 percent lost about 40 cents per hour since 1979. Because wages have not kept pace with growth, many minimum wage workers live in or near poverty. Today, an Ohio family of three with a breadwinner who works full-time at a minimum wage job makes $3,500 below the poverty line ($20,420). Moreover, many low-wage workers do not have the benefit of stable, predictable hours, much less a full-time schedule.
“When wages fail to grow with economy, the deep American belief that hard work leads to success and stability is shaken,” said Policy Matters Ohio researcher and report author Michael Shields. “Low wages force parents to work two or more jobs and choose between making enough to get by or spending time with their children. It puts enormous stress on families.”
More than 700,000 Ohio children have a parent who would get a raise if the minimum wage goes up to $15 an hour by 2025. It would be especially beneficial for women who are more likely to earn the sub-minimum wage for tipped workers of $4.08 an hour. Forty-one percent of women and 28 percent of men would get a raise. Raising the wage would also help narrow the pay gap between black and white workers, which grew from $1.65 to $3.30 between 1979 and 2016 (adjusted for inflation). Nearly half of black workers – 47 percent – would get a pay boost. The report also shows that 85 percent of minimum-wage workers have finished high school and 88 percent are adults.
Policy Matters calls for the state to raise the minimum wage to $12 an hour in 2019 and step up by $.50 a year until reaching $15 an hour in 2025. Policymakers should eliminate the sub-minimum wage for tipped workers and index the minimum wage to inflation so it won’t lose value over time.
“Raising the minimum wage will lift children out of poverty, shrink inequality and reduce dependency on safety net programs,” Shields said. “It’s past time for the state to set a living minimum wage so no one who works full time would have to live in poverty.”