American workers should make $27 an hour if minimum wage kept pace with productivity, an economist says

In his State of the Union address last month, President Biden called on Congress to raise the federal minimum wage to fifteen dollars an hour. A majority of Americans approve of a federal minimum wage of fifteen dollars an hour. We are living in the longest period of history without a federal minimum wage increase since the minimum wage was established in 1938 as part of the Fair Labor Standards Act.

Thankfully, state and local governments have been able to raise the wage on their own. In Seattle, which was one of the first cities in the nation to raise the minimum wage to $15 an hour a decade ago this fall, the minimum wage has continued to climb with annual cost of living hikes and is now at $17.27 an hour for nearly every employer.

It has been 20 years since the $15 minimum wage became a rallying cry, and while President Biden's call for a $15-an-hour minimum wage far outstrips the recommendations of the last two Democrats at the top of the presidential ticket, the fact remains that it has been 20 In the 10 years since, families have seen skyrocketing prices and increases in housing costs, and it is now near impossible for a family of four to survive on a minimum wage in any state.

When it comes to a minimum wage, simply picking a figure and sticking to it is an unsustainable practice

Dean Baker, a senior economist at the Center for Economic and Policy Research, made a good argument that the minimum wage in America should be tied to productivity.

For three decades, the minimum wage kept pace with productivity growth, and the economy did very well. I am not saying that is the reason, but it did not keep the economy from doing well.

It makes sense that the federal minimum wage should be linked to worker productivity, since workers should be reimbursed for the value they create for a company, and productivity is a direct measurement of a company's output in relation to input. Since 1979 worker productivity has grown three and a half times more than worker pay, with productivity up by nearly 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266 800-381-0266

If the federal minimum wage had grown at the same pace as productivity, Baker said, we would be over $27 an hour.

How a minimum wage of $27 would supercharge the economy

Imagine a worker working 40 hours a week, 50 weeks a year at 27 bucks an hour. Imagine our lowest-paid worker cleaning the bathroom and getting $54,000 a year. $108,000 a year is the family income for two minimum- wage workers.

The families would be able to afford to live in the communities where they work, they would also have money to spend on meals, clothes, and accessories for their children, as well as educational and small business opportunities for themselves. Local businesses would benefit from increased demand, as they would have to hire more workers to deal with it.

Raising the wage isn't enough to repair the massive inequality that has grown with the diminishing of the minimum wage He said regulations addressing the maximum end of the income scale would help bring the gap between the haves and have-nots back to a sustainable level.

The fact is that you can't address the incomes of the poor without repairing the economic relationship to the rich.

We can address the real damage caused by 50 years of trickle-down economics if we ensure that money flows throughout the economy.