New York State Assemblyman Fred W. Thiele, Jr. (I, D, WF-Sag Harbor) announced that legislation he sponsored to increase the minimum wage to $9.00 per hour in January 2014 has passed the Assembly (A.38-A). The bill would also index the minimum wage to inflation beginning in 2015 – reflecting annual changes in the Consumer Price Index (CPI) – and set wages for food service workers who receive tips to $6.21 per hour.

“Families living on inadequate minimum wage salaries are struggling to stay afloat as the cost of living continually rises,” Assemblyman Thiele said. “It’s a matter of fairness and economic common sense. Increasing the minimum wage will help working families make ends meet, and a rise in their purchasing power will provide a much-needed boost for the East End economy.”

The Assembly previously passed legislation to raise the minimum wage in New York from $7.25 per hour to $8.50 per hour and index it to the rate of inflation. President Obama then proposed increasing the federal minimum wage to $9.00 per hour and indexing it to inflation. The Assembly amended its legislation to match the president’s plan.

“The national attention to this important issue is encouraging, but hardworking East End families can’t afford to wait out the political gridlock in Washington,” Thiele said. “With overwhelming public support to increase the minimum wage here in New York State, we have to act now.”

According to a recently released Assembly policy paper on minimum wage, more than 80 percent of New Yorkers polled in January support efforts to raise the minimum wage.ⁱ The change would directly benefit 925,000 New Yorkers currently earning below $9.00 an hour – over 10 percent of the state’s employed population. Corporate profits of low-wage employers are experiencing record growth,ⁱⁱ making it a good time to raise the minimum wage, Thiele added.

The report also shows that boosting the minimum wage will have a positive effect on the economy. States that have enacted minimum wages above the federal rate have experienced higher rates of growth in companies, job creation and payroll. Low-wage workers are likely to spend extra earnings immediately on basic needs or services. They support their families by spending their income at businesses located closest to home, in their communities.

Currently, the neighboring states of Massachusetts, Connecticut and Vermont have higher minimum wages than New York State, as do 16 other states and the District of Columbia. Ten other states have already passed legislation indexing the minimum wage to inflation. New York’s minimum wage has increased just 10 cents per hour in the last six years and was last raised when the federal minimum wage increased from $7.15 to $7.25 an hour in 2009.

From 2002 to 2012, the percent increase in CPI ranged from 1.6 percent to 3.8 percent annually. Over that time, gasoline prices rose 169 percent; education 72 percent; household energy costs 49 percent; medical care 45 percent; groceries 32 percent; and clothing 2 percent.ⁱⁱⁱ

“Every year the minimum wage doesn’t increase, minimum wage workers see the value of their labor decline,” Assemblyman Thiele said. “Indexing the minimum wage to inflation will take care of this once and for all and ensure East End families are fairly compensated for their hard work.”

The Assembly-issued minimum wage policy paper is accessible at: http://assembly.state.ny.us/ssspolicy/2013minwage.pdf

i. Quinnipiac University Polling Institute, January 31, 2013

ii. www.assembly.state.ny.us/ssspolicy/2013minwage.pdf

iii. Ibid