While Out of Touch Politicians Balk, Companies Have Been Raising Base Pay for Workers

The overwhelming public support for higher minimum wages, displayed in poll after poll after poll — and especially among the 42 percent of American workers who are paid less than $15 an hour – hasn’t yet moved tone-deaf politicians on the right to embrace raising the minimum wage. But a growing number of employers, including some large corporations, are recognizing that the low-wage business model is one that’s actually not good for business and have been raising base pay for their lowest-paid workers – with some adopting at least a $15 minimum wage.

As we reported last week, the nationwide Fight for $15 strikes and protests on the day of the latest Republican presidential debate prompted the very first question for front-runners Donald Trump and Ben Carson, on whether they support raising the minimum wage. They both said they opposed raising the minimum wage, and so did Marco Rubio. Trump, the billionaire real estate mogul and reality television celebrity, displayed a certain lack of grip on reality when he opined that U.S. workers’ “wages are too high.” None of the other seven Republican candidates on the prime time debate stage voiced their disagreement.

Just two days later, Popeyes CEO Cheryl Bachelder offered a more rational view, representative of an increasing number of business executives and other employers. Asked about the growing movement to raise minimum wages, including gradual phase-ins of $15 wages in fast food and other industries, she told CNN Money: “Everybody in retail is dealing with an increase in minimum wage. We will adjust to increased costs just like we have before. Life will go on.” “Labor costs are going up. When Target, Walmart and McDonald’s moved wages higher, the marketplace moved with them,” she added.

Those three low-wage retail and fast food giants all announced increases in their base wages earlier this year, albeit far too modest ones. Similar increases in the $9 to $10 minimum range have been announced by retailers Gap, T.J. Maxx and Marshalls, while Ikea is implementing a second set of base pay increases in January which will bring its average store starting wage to nearly $12 per hour.

Other employers have been raising minimum pay rates even higher, with nearly two dozen adopting base hourly wages of $15 or more over the last two years. Those $15-plus companies include Ben & Jerry’s, the ice cream maker; Moo Cluck Moo, a fast-casual restaurant chain in the Detroit area; JM Family Enterprises, a Florida-based automotive sales a distribution company; Google, the internet search giant; New York headquartered Amalgamated Bank; and both Aetna and Nationwide Mutual, two major insurance companies. (For a more complete list of employers who have adopted base wages of $15 or higher in the last two years, see the table on page 27 of NELP’s updated report The Growing Movement for $15.)

As even more states and cities, as well as public and private employers raise minimum wages and increase base pay for workers, those politicians who stand in the way and oppose higher minimum wages look increasingly out of touch.

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About the Author

Mitchell Hirsch

Areas of expertise:
  • Living Wage & Minimum Wage,
  • Unemployment Insurance

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