We’ve released a new factsheet on how raising the minimum wage to $15 by 2025 in Wisconsin would impact the state’s workers. Using data from the Economic Policy Institute’s recently released report on the Raise the Wage Act of 2021 (which would raise the national minimum wage to $15 per hour by 2025), we’ve summarized findings for Wisconsin and added some context to fill in the picture on wage standards in the state and region.
COWS’ State of Working Wisconsin 2020 showed the ways the pandemic and the COVID-19 economic collapse has exposed and exacerbated economic inequality in the state. The workers who have carried the brunt of the economic burden are disproportionately people of color and women, working in our lowest wage sectors. These are the very workers who stand to gain from a higher minimum wage.
Want the Wisconsin data set for your own analysis? You can download it here.
Wisconsin’s wage floor is at the current federal minimum wage $7.25 per hour. The wage floor has not been raised in over 10 years. Frozen at $7.25 since 2009, inflation has reduced the purchasing power of the minimum wage by 18 percent. If the 1968 minimum wage was adjusted for inflation, it would be $10.59 per hour. If the minimum wage had grown along with productivity over the last 50 years, it would be $22 today.
30% of Wisconsin workers stand to gain
Nationally, raising the minimum wage to $15 per hour by 2025 would raise the earnings of 32 million workers, or 21% of the workforce. In Wisconsin, a greater share of the workforce would see a raise.
Three of every ten workers in the state – more than 843,000 workers – would benefit.
- This includes 21% of Wisconsin workers with wages currently below the new minimum (“directly affected”).
- Another 9% of workers have wages just above the new minimum and would get raises as pay scales are adjusted upward (“indirectly affected”).
- The wage increase would bring higher wages to more than 586,000 directly affected workers and 257,000 indirectly affected workers.
A minimum wage increase to $15 by 2025 would help close racial, ethnic, and gender wage gaps.
- The wage increase would raise earnings for half of Black workers in Wisconsin.
- The wage increase would raise earnings for just over half of Hispanic workers in Wisconsin.
- The wage increase would raise earnings for 37% of women workers in the state.
Wages up and “little to no job losses”
Minimum wage increases have not led to significant job losses. According to the Economic Policy Institute:
“Despite claims that raising the minimum wage would reduce job opportunities for vulnerable groups of workers, the best evidence shows little to no job losses in the wake of minimum wage increases and a net wage gain even if job losses have occurred. These benefits explain why surveys show that the people most likely to support a minimum wage increase are unemployed people, people of color, and women.”
Other states raise the floor – and Wisconsin workers are left behind
Wisconsin is currently one of just 21 states where the wage floor is set by the federal minimum. 29 states and the Washington DC have wage floors above the federal minimum.
- Neighboring states have higher wage floors. In Minnesota the current minimum is $10.08 per hour and in Illinois it is $11.
- While many of the states with higher minimum wages are on the coasts, Montana, South Dakota, West Virginia, and Missouri all have minimum wages above Wisconsin’s.
- 18 states and Washington DC annually increase their minimum wage so that it keeps pace with inflation.
Minimum wage increases are popular and regularly win on statewide ballots.
In the November 2020 election, the state of Florida passed a referendum putting that state on the path to a $15 minimum wage. In the last two decades, statewide minimum wage increases have gone to voters 22 times. In each instance, the wage increase has passed.
Wisconsin cities can’t raise the wage floor.
In Wisconsin, state law denies municipalities the ability to establish wage floors above the state minimum. This means that cities here cannot pursue wage increases for workers as some 45 localities across the United States have. The state legislature could restore localities’ right to establish wage floors above the state minimum.