Raising the minimum wage is good for workers, good for businesses and good for our communities.
To see our communities thrive and an economy that benefits everyone in North Carolina, we need living-wage jobs that pay enough to make ends meet and allow workers to afford the basics in life: groceries, health care and housing. When people can’t afford the basics, it hurts all of us. Workers have less to spend, businesses have fewer customers and lower sales, and the economy slows down, damaging our communities.
Raising the minimum wage and indexing it to inflation are important steps on the path to making sure that all North Carolinians earn a living wage that lets them afford the basics and will boost the economy for all of us. That’s why the legislature should put this on the ballot and let North Carolinians’ voices be heard.
Nearly 1 in 3 working North Carolinians in communities across the state is earning poverty wages. They are forced to make difficult choices between buying food or paying the rent, keeping the lights on or driving to work. The reality is that to make ends meet in North Carolina, a family of four needs at least $52,000 a year on average. Workers earning $7.25 an hour would need to earn 3.5 times more to get to that level of financial security. That does not account for the realities of paying off debt or setting money aside for emergencies.
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In North Carolina, the boom in low-wage work since the start of the recovery is creating a greater hurdle for boosting the economy. Three out of every 4 jobs created since 2009 pay an average wage that doesn’t allow workers to afford the basics.
Raising the minimum wage is a critical antidote to this boom in low-wage jobs because it would put more money in the pockets of workers most likely to spend it. Raising the wage to $10 an hour would increase paychecks for North Carolina’s workers by $2 billion a year. That’s $2 billion in increased consumer spending at local businesses, boosting sales and profits and creating more than 5,000 new jobs.
Increasing the wage floor to $10 an hour would affect approximately 1 million workers in North Carolina, almost 6 in 10 of whom are women. The vast majority of these workers are not the part-time, teenage workers who once filled the bulk of entry-level jobs in past generations. Now, more than 85 percent of those benefiting from a minimum wage increase would be workers older than 20, and more than half work full-time.
Aside from increasing sales, raising the minimum wage helps small businesses reduce payroll costs by reducing employee absenteeism and turnover while simultaneously increasing productivity. Economists have long recognized that better-paid workers are more efficient, more effective and more productive. Higher wages persuade workers to stay on the job longer.
The benefits for business and workers alike are why economists have repeatedly found that those states that increased their minimum wages have seen better economic performance, lower unemployment and higher job creation rates than those states that didn’t raise their wages, controlling for regional economic trends. The evidence clearly and repeatedly contradicts critics who claim that increasing the minimum wage forces employers to offset greater payroll costs by reducing the number of employees.
We all want to see North Carolina’s economy work for everyone and create vibrant, thriving communities. That’s why we need to raise the minimum wage to a livable level that allows workers to afford the basics.
The Rev. Dr. William J. Barber II is president of the NC NAACP. Bill Wilson is executive director of the N.C. Justice Center.
What: Moral Monday on Wednesday protest to raise the minimum wage and secure fair tax policy
When: 5 p.m. Wednesday
Where: N.C. General Assembly, 16 W. Jones St, Raleigh