A $22 an hour minimum wage is what Sen. Elizabeth Warren (D) of Massachusetts suggested at a recent hearing of the Senate Committee on Health, Education, Labor and Pensions.
The story, carried by Yahoo! News March 19, stated the Senator is making a case for the current wage-per-hour to reflect gains in productivity.
While the $22 wage may be in line with present financial markets, don’t expect to see it anytime soon. The current minimum wage is only $7.25 per hour, and tripling it would send businesses crashing and millions into unemployment.
Warren did not present a bill to Congress formally petitioning the wage hike. Rather, her exchange was merely meant to highlight what could, and should have been, in her estimation.
While speaking to economist Arindrajit Dube at last week’s Senate Committee hearing, Warren had this to say:
“If we started in 1960 and we said that as productivity goes up, that is as workers are producing more, then the minimum wage is going to go up the same. And if that were the case then the minimum wage today would be about $22 an hour. So my question is Mr. Dube, with a minimum wage of $7.25 an hour, what happened to the other $14.75? It sure didn't go to the worker.”
Dube agreed. In response he stated, “It is quite remarkable that had the minimum wage kept up with overall productivity, it would have been $22 per hour in 2011. Had it kept up with the growth in income going to the top one percent, it would have been even higher, at $24 per hour, and the wage would have exceeded $33 per hour at its peak in 2007.”
The minimum wage growth, while tracking fairly evenly with productivity between the end of World War II and the late 60s, has since veered off course.
Since 1968, the nation’s productivity has outpaced the amount we pay our minimal wage workers. If the minimum wage had stayed in line with growth, fast food and customer service employees would be pocketing $21.72 per hour in 2012.
In his State of the Union address, President Obama called on Congress to raise the federal minimum wage to $9 an hour. House Minority Leader Nancy Pelosi has pushed for $10.10 an hour. Both proposals face stiff opposition in a GOP controlled Congress.