An $11 Minimum Wage for All Arkansans: Raising the Quality of Life for 300,000 Workers in All 75 Arkansas Counties

This November, Arkansas voters will decide whether to increase the state’s minimum wage to $11 by 2021. Someone currently working full-time for minimum wage in the state earns only $340 per week.[1] If Issue 5 passes, approximately 300,000 workers across the state will see their incomes rise. That represents nearly 1 out of 4 workers in Arkansas. This fact sheet presents the first county-by-county analysis of who will benefit from increasing Arkansas’ minimum wage to $11 by 2021. Across all 75 of Arkansas’ counties, regardless of population size and density, approximately 300,000 workers will benefit from a minimum wage increase.

If Issue 5 succeeds, Arkansas will join the more than 20 states that have raised their minimum wage since 2012. The appendix includes a chart estimating how many workers in each Arkansas county will benefit.

Workers in Every Single Arkansas County—Nearly 1 in 4 Working Arkansans in Total—Would Benefit From an $11 Minimum Wage

A higher minimum wage would allow workers across Arkansas to cope with the rising cost of basic necessities, such as housing, food, transportation, and healthcare. Even in Arkansas’ smallest county, Calhoun County,[2] a single adult needs to make $33,403 per year to afford a modest standard of living, [3] though the yearly income for a full-time worker (40 hours a week) at the current $8.50 minimum wage[4] is only $17,680. See the Appendix for a complete list of counties and estimated number of workers affected.

As Table 1 shows, workers who would benefit from Issue 5 represent nearly a quarter of all working Arkansans. By 2021, each worker directly affected will earn an average of $1,040 more annually and wages will increase by an estimated average of $1,520 when taking into account both directly and indirectly affected workers.[5] The additional income would not only help working families throughout the state, it would also benefit small businesses and Arkansas’ broader economy. Research shows that higher wages lead to increased spending, which, in turn, has the effect of boosting the demand for goods and services[6] and keeping money circulating in the economy—creating a virtuous cycle that benefits a broad constituency.[7]

Table 1. Arkansas Counties That Would Benefit From a Higher Minimum Wage
Number of counties Number of Workers Average Pay Increase Per Employee (Directly and Indirectly Affected)
All Arkansas counties that would benefit 75 300,000 $1,520
Share of total 100% 24.8%
 Source: NELP analysis of data from the Bureau of Labor Statistics’ 2016 Quarterly Census of Employment and Wages (QCEW), Arkansas Advocates for Children and Families, the Census Bureau’s 2016 Current Population Survey Outgoing Rotation Groups (CPS ORG) and the CBO’s Economic Projections  (June 2017).

In 26 Counties, Issue 5 Will Raise Wages for More than 30 Percent of Workers, Largely in Arkansas’ Small Towns and Rural Areas

A NELP analysis shows that if voters approve the initiative, 300,000 workers, living in each of Arkansas’ 75 counties will see the benefits of a higher wage. Examining data from the Bureau of Labor Statistics and Arkansas Advocates for Children & Families, this analysis also found that Issue 5 would increase wages for at least 30 percent of each county’s workers in 26 counties.[8]  All of these counties lie outside of Little Rock, Fort Smith, and Fayetteville. See Table 2 for a breakdown of Arkansas counties where at least 30 percent of workers will see their wages increase through Issue 5.

Table 2. Counties in Arkansas Where at Least 30 Percent of Workers Will See a Wage Increase Through Issue 5
County Percentage of area workers impacted  

County

  Percentage of area                 workers impacted
Newton County 37.8% Polk County 32.0%
Searcy County 36.4% Yell County 31.8%
Montgomery County 35.7% Dallas County 31.7%
Stone County 34.6% Cleveland County 31.2%
Fulton County 33.8% Chicot County 31.2%
Carroll County 33.5% Logan County 31.1%
Scott County 33.5% Phillips County 30.7%
Marion County 33.3% Cleburne County 30.6%
Clay County 33.2% Johnson County 30.4%
Sharp County 33.0% Lawrence County 30.4%
Pike County 32.7% Howard County 30.4%
Monroe County 32.6% Sevier County 30.4%
Randolph County 32.1% Izard County 30.2%
   Source: NELP analysis of data from the Bureau of Labor Statistics’ 2016 Quarterly Census of Employment and Wages (QCEW), the

Arkansas Advocates for Families and Children and the Current Population Survey. For more details on methodology, see Endnote 8.

A Growing Number of Jurisdictions Are Enacting Minimum Wage Increases, Reflecting Continued Concerns With Low Wages and Support for Bold Change

With job growth skewed towards low-paying occupations over the past decade, there has been growing national momentum for action to raise the minimum wage. Although the U.S. median household income is slowly climbing from the depths of the Great Recession,[9] hourly wages continue to stay flat or decline for most of the labor force, even amidst the economic recovery and a full employment economy. The worsening prospects and opportunities for low-wage workers have prompted a growing number of cities, counties, and states to enact higher minimum wage rates for their residents, often with overwhelming support from voters.[10]

More than 25 years of extensive economic research overwhelmingly concludes that states can increase their minimum wage without reducing employment. Sophisticated recent research and the actual experiences of U.S. states and cities show that increases are manageable for employers and have extensive benefits in increased productivity, lower turnover, and even higher earnings.[11]

The trend in localities and states pushing for higher minimum wage rates is likely to continue as wages decline or stagnate, inequality worsens or remains high, and Congress fails to take bold action to ensure that hard-working individuals can make ends meet.

Conclusion

Raising the minimum wage is one of main tools that states and cities across the country are using to help working families overcome decades of stagnating wages and the rising cost of basic necessities. There is no part of Arkansas where workers and families can afford the basics, save, and achieve some economic security under the state’s current $8.50 minimum wage. Issue 5 would bring a much-needed wage increase to nearly 1 in 4 workers in Arkansas, directly affecting every county in the state.

Appendix 1: Workers in every Arkansas county would benefit from a $11 minimum wage by 2021
State/County Total affected Total workforce As % of  total  workforce County Total affected Total workforce As % of total  workforce
Arkansas 300,272 1,160,225 24.8% Drew County 1,904 6,684 28.5%
Arkansas County 2,566 10,321 24.9% Faulkner County 10,618 41,988 25.3%
Ashley County 1,653 6,922 23.9% Franklin  County 1,278 4,662 27.4%
Baxter County 4,394 15,228 28.9% Fulton County 644 1,904 33.8%
Benton County 23,272 119,556 19.5% Garland County 10,550 37,918 27.8%
Boone County 3,913 14,514 27% Grant County 1,079 4,134 26.1%
Bradley County 1,145 3,849 29.8% Greene County 4,339 16,012 27.1%
Calhoun County 585 2,873 20.4% Hempstead County 2,320 8,157 28.4%
Carroll County 3,770 11,266 33.5% Hot Spring County 2,473 8,841 28.0%
Chicot County 1,055 3,376 31.2% Howard County 2,209 7,275 30.4%
Clark County 2,726 9,490 28.7% Independence County 4,362 16,057 27.2%
Clay County 1,156 3,478 33.2% Izard County 986 3,269 30.2%
Cleburne County 2,086 6,828 30.6% Jackson County 1,528 5,544 27.6%
Cleveland County 314 1,004 31.2% Jefferson County 7,387 29,446 25.1%
Columbia County 2,154 8,412 25.6% Johnson County 2,734 8,992 30.4%
Conway County 1,862 6,916 26.9% Lafayette County 368 1,260 29.2%
Craighead County 13,249 50,702 26.1% Lawrence County 1,278 4,204 30.4%
Crawford County 5,700 20,293 28.1% Lee County 614 2,054 29.9%
Crittenden County 4,718 17,210 27.4% Lincoln County 887 2,984 29.7%
Cross County 1,535 5,204 29.5% Little River County 742 3,622 20.5%
Dallas County 937 2,959 31.7% Logan County 1,796 5,775 31.1%
Desha County 1,385 4,773 29.0% Lonoke County 4,209 14,632 28.8%
State/County Total affected Total workforce Percentage of total  workforce County Total affected Total workforce Percentage of total  workforce
Madison County 965 3,307 29.2% Scott County 1,071 3,199 33.5%
Marion County 1,324 3,977 33.3% Searcy County 592 1,625 36.4%
Miller County 3,463 13,506 25.6% Sebastian County 16,781 69,177 24.3%
Mississippi County 4,345 18,755 23.2% Sevier County 1,549 5,103 30.4%
Monroe County 729 2,231 32.6% Sharp County 1,322 4,007 33.0%
Montgomery County 514 1,441 35.7% St. Francis County 2,340 8,273 28.3%
Nevada County 698 2,567 27.2% Stone County 921 2,661 34.6%
Newton County 436 1,153 37.8% Union County 4,074 18,533 22.0%
Ouachita County 2,167 7,380 29.4% Van Buren County 1,025 3,728 27.5%    
Perry County 382 1,278 29.8% Washington County 24,308 107,503 22.6%
Phillips County 1,752 5,698 30.7% White County 6,817 25,026 27.2%
Pike County 845 2,583 32.7% Woodruff County 533 1,854 28.8%
Poinsett County 1,509 5,454 27.7% Yell County 2,133 6,715 31.8%
Polk County 1,949 6,084 32.0%  

 

 

 

Pope County 6,872 27,268 25.2%
Prairie County 462 1,547 29.8%
Pulaski County 55,387 258,092 21.5%
Randolph County 1,633 5,079 32.1%
Saline County 6,891 24,498 28.1%
Source: NELP analysis of data from the Bureau of Labor Statistics’ 2016 Quarterly Census of Employment and Wages (QCEW), the Arkansas Advocates for Children and Families, and the Census Bureau’s 2016 Current Population Survey Outgoing Rotation Groups (CPS ORG).

 

Endnotes

 [1]. Based on a 40-hour workweek at the current Arkansas minimum wage of $8.50 per hour. Arkansas Department of Labor, Minimum Wage and Overtime, https://www.labor.arkansas.gov/minimum-wage-and-overtime (last viewed Oct. 11, 2018).

[2]. Calhoun County has the smallest population by county in Arkansas. See U.S. Census, QuickFacts, Calhoun County, Arkansas, https://www.census.gov/quickfacts/calhouncountyarkansas (last viewed Oct. 11, 2018).

[3]. Economic Policy Institute, “Family Budget Calculator,” https://www.epi.org/resources/budget/ (last visited Oct. 11, 2018).

[4]. Arkansas Department of Labor, Minimum Wage and Overtime, https://www.labor.arkansas.gov/minimum-wage-and-overtime (last viewed Oct. 11, 2018).

[5]. Arkansas Advocates for Children & Families, An Arkansas Minimum Wage Increase: How It Works And How It Would Benefit Arkansans And The State (Sept. 2018) at 6, http://www.aradvocates.org/wp-content/uploads/AACF.miniwage.webfinal.rev_.9.17.18.pdf.

[6]. See, e.g., Patrick Reimherr, U.S. Department of Labor: Blog, “Higher Wages, a Stronger Bottom Line and Job Growth,” (Aug. 1, 2014), https://blog.dol.gov/2014/08/01/higher-wages-a-stronger-bottom-line-and-job-growth.

[7]. See, e.g., International Labour Organization, Can Minimum Wages Help Rebalance the Economy? (Aug. 12, 2013),           http://www.ilo.org/newyork/voices-at-work/WCMS_219658/index.htm.

[8]. NELP analysis of data from the Bureau of Labor Statistics’ 2016 Quarterly Census of Employment and Wages (QCEW), the Arkansas Advocates for Family and Children, e and the Current Population Survey. Estimates are not reported for any counties in which private sector wage data are unavailable in the QCEW. Statewide figure provided by the Economic Policy Institute (EPI). State and county estimates of affected workers include both directly and indirectly affected workers. Indirectly affected workers have a wage rate just above the new minimum wage (between the new minimum wage and the new minimum wage plus the dollar amount of the increase in the previous year’s minimum wage). They will receive a raise as employer pay scales are adjusted upward to reflect the new minimum wage. Indirectly affected workers include workers projected to make less than $11.00 per hour in 2021. For this analysis, we assume that nominal wage growth will total 2.5 percent in each year. The projected share and number of affected workers in each county is based on the QCEW reported mean weekly wage and an assumed 74 percent ratio between the standard deviation and the reported mean. Projections of hourly wages based on work hours for workers in the lowest wage quintile as estimated by EPI in https://www.epi.org/publication/trends-in-work-hours-and-labor-market-disconnection/.

[10]. See, e.g., National Employment Law Project, Fight for $15: Four Years, $62 Billion (Dec. 2016), https://www.nelp.org/wp-content/uploads/Fight-for-15-Four-Years-62-Billion-in-Raises.pdf; National Employment Law Project, New Poll Shows Overwhelming Support for Major Minimum Wage Increase (Jan. 15, 2015), https://nelp.org/wp-content/uploads/2015/03/PR-Federal-Minimum-Wage-Poll-Jan-2015.pdf; National Employment Law Project, Minimum Wage a Big Winner on Election Day (Nov. 2016), https://www.nelp.org/wp-content/uploads/Minimum-Wage-Wins-2016-Elections.pdf.

[11] Arindrajit Dube et al., “Minimum Wage Effects across State Borders: Estimates Using Contiguous Counties” The Review of Economics and Statistics (Nov. 2010), 92(4): 945–64. See also Doruk Cengiz et al., “The Effect of Minimum Wages on the Total Number of Jobs: Evidence from the United States Using a Bunching Estimator,” Society of Labor Economists (Apr. 2017), http://www.sole-jole.org/17722.pdf. (Updated Dec. 2017 version can be accessed from the American Economic Association, https://www.aeaweb.org/conference/2018/preliminary/1530). Sylvia Allegretto et al., Center on Wage and Employment Dynamics, The New Wave of Local Minimum Wage Policies: Evidence from Six Cities (Sept. 6, 2018), http://irle.berkeley.edu/the-new-wave-of-local-minimum-wage-policies-evidence-from-six-cities/.

© 2018 National Employment Law Project. This report is covered by the Creative Commons “Attribution-NonCommercial-NoDerivs” license fee (see http://creativecommons.org/licenses). For further inquiries, please contact NELP (nelp@nelp.org).

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