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Senator Baldwin Applauds President Obama’s Action on Raising Minimum Wage

“We need to reward hard work by raising the minimum wage so an honest day’s work pays more.”

Washington D.C. – U.S. Senator Tammy Baldwin today praised President Obama for making a push to raise the federal minimum wage. In the State of the Union Address, the President will announce that he will use his executive authority to raise the minimum wage to $10.10 for those working on new federal contracts for services. The President will also propose working with Congress to pass the Minimum Wage Fairness Act, cosponsored by Senator Baldwin, which would increase the federal minimum wage for all workers.

“I believe that our economy is strongest when we expand opportunity for everyone. We need to reward the hard work of Wisconsinites by raising the minimum wage so an honest day’s work pays more,” said Baldwin.

The President’s Executive Order (EO) will benefit hardworking Americans – including janitors, cashiers, construction workers, and others – working on new federal contracts. For example, the EO would benefit military base workers who wash dishes, serve food and do laundry.  This action will cover workers who are performing services or construction and are getting paid less than $10.10 an hour. In September, Senator Baldwin joined 14 of her Senate colleagues in sending a letter to President Obama encouraging him to use his executive authority to raise the minimum wage for employees of federal contractors.

Senator Baldwin believes it’s time for Congress to act on raising the minimum wage for all Americans. The Minimum Wage Fairness Act will raise the minimum wage to $10.10 over three years, lifting it closer to its historic level, and will index the minimum wage to inflation in the future so that low-wage workers do not continue to fall behind.  The Act will also raise the minimum wage for tipped workers for the first time in more than 20 years, raising it to a level that is 70 percent of the regular minimum wage.

“The growing gap between those at the top and everybody else is at its largest point in 100 years. The absence of upward mobility for hard working families demands action because if we can’t close this gap, we might someday soon talk about the middle class as something we used to have, not something each generation can aspire to,” Baldwin said.

In a public opinion poll released yesterday by Marquette University, a majority of Wisconsinites polled favor an increase in the minimum wage. Sixty-two percent say the minimum wage should be increased while 35 percent oppose an increase. After a reminder to the respondent that the current minimum wage is $7.25 per hour, 33 percent say it should be increased to about $9 per hour, 25 percent say it should be around $10 per hour, 5 percent say about $11 per hour and 10 percent say it should be $12 or more per hour. Only 25 percent say it should remain where it is.

Background on Raising the Minimum Wage

  • The current wage of $7.25 was implemented in July 2009, the final of three increases resulting from 2007 legislation signed by President George W. Bush.
  • Raising the minimum wage will make sure no family of four with a full-time worker has to raise their children in poverty. It has been seven years since Congress last acted to increase the minimum wage and right now a full-time minimum wage worker makes $14,500 a year, which leaves too many families struggling to make ends meet. Even after accounting for programs like the Earned Income Tax Credit, a family of four supported by a minimum wage worker still ends up living below the poverty line.
  • Indexing the minimum wage to inflation would help lower-income workers keep up in the future. Since it was first established in 1938, the minimum wage has been increased 22 times, but was eroded substantially over several prolonged periods because of inflation. If the minimum wage had kept up with inflation since 1968, it would be worth $10.75 per hour today. 
  • Twenty-eight million American workers will get a raise under the Minimum Wage Fairness Act.  More than half of these are women, and 15 million women would get a raise. The vast majority (88 percent) are adult workers, not teenagers.  Over 14 million children (19 percent of American kids) have a parent who will get a raise.
  • Increasing the minimum wage to $10.10 per hour will give $35 billion in raises to millions of workers over the course of the three increases, and increase GDP by nearly $22 billion as workers spend their raises in their local businesses and communities.  This economic activity will generate 85,000 new jobs over the same period.