Pushing for $15 an Hour is the Most Dominant Legislative Discussion

As the state legislature began to gather for its session, Governor Kate Brown announced a six-year plan to steadily raise minimum wage in Oregon—and, in doing so, struck the dominant chord for upcoming conversations about law-making in the state. By 2022, Gov. Brown’s proposal would nudge the minimum wage to $15.52 per hour in Portland-area, and $13.50 elsewhere. Her proposal was quickly met TK, including TK.

And, all of these proposals to quickly or slowly increase the minimum wage drop into a hornets’ nest of union and business lobbyists. During the last legislative session, Oregon lawmakers were unable to agree on a minimum wage increase, and those differences of opinions do not seem to have abated any other the past year.

Moreover, on the larger stage, the federal minimum wage, has stubbornly remained at $7.75 since 2009, while, meanwhile, several cities—namely, Seattle, San Francisco and LA—have pushed minimum wages to $15, and several large companies, most notably Wal-Mart to $9 per hour, have voluntarily increased what their minimum wage level about the federally-mandated level. At $9.25 an hour, Oregon currently has the nation’s second-highest wage floor for a state; $2 higher than the federal minimum.

For workers and businesses in Southern Oregon, the debate over minimum wage is particularly keen as poverty rates are high and median incomes low, and as many businesses rely on tourism, an industry which has minimum-wage earners as its foundation. But the debate over minimum wage in Ashland is also not a new conversation as, in 2001, city council took the audacious step to enact the Living Wage Ordinance, which sets the minimum wage higher than what is required by the state. While the ordinance has limited impact—to city contracts—it does announce an intent and attitude about what city leaders believe—and if either Gov. Brown’s measure or the ballot initiative is successful, serves as a litmus test. Last June, the City of Ashland moved that minimum wage to $14.42.

Dave Kanner, City Administrator for Ashland, provides some insights to how increased minimum wages may impact the local economy. “Ashland’s living wage ordinance mandates that contractors doing business with the city provide wages and benefits totaling $14.42/hr. to their employees,” he explains. He adds, “I am not aware of any harm done by this law. In the four years that I’ve been city administrator, I’ve received no complaints about it.”

Likewise, Oregon’s own history in minimum wage increases provides some predictions about what to expect from minimum wage increases. In the 1970s, the minimum wage jumped 80 percent over four years, and in the late 80s made another 40 percent leap over two years. According to the Oregon Center for Public Policy, after both those large increases, Oregon’s economy and small businesses did not suffer, but grew.   

City of Ashland councilmember Stefani Seffinger agrees that higher minimum wages are important to provide a healthy function of the community. “My opinion about raising the minimum wage is that it would benefit both workers and the quality of life for our citizens,” she says. Seffinger goes on to explain that the minimum wage helps provide a strong footing for individuals and families, as well as the community at-large. “I do believe that having citizens who cannot afford the basics puts an additional burden on both city and county services in the assistance that the working poor need to pay for utilities, food, and  affordable housing. With the increasingly high cost of rent and lack of affordable housing more people are being pushed into homelessness or living in substandard housing  and overcrowding.”

Seffinger also recognizes low wages reach further than just the pocketbook. “The stress of not being able to afford the basics can also increase a person’s risk of depression, alcohol and drug abuse. These conditions have a negative  consequence to all of society especially to the future of our children. There is also a financial impact on county services to provide increased mental health and drug rehabilitation services.”

The biggest puskback, not surprisingly, is for businesses which, if the minimum wage does increase to $15 per hour, are estimated to have a combined additional $2.6 billion in annual payroll expenses.

“I know that there are concerns that raising the minimum wage will have negative impacts for small businesses and youth employment in areas like the fast food industry,” Steffinger concedes. “This belief can be countered with looking at data that raising the minimum wage will have the effect of motivate employees to work harder, find more job satisfaction, decrease the number of sick days taken and decrease turnover.”

Fellow councilmember Pam Marsh agrees with many of these assessments—and, in particular, sees merit in Gov. Brown’s proposal. “The differentiated wage should draw support from workers and wage advocates in Portland, and, at the same time, minimize objections from business interests in the rest of the state who argue that rural areas are still recovering from the recession.” 

“My family owns a business in the hospitality industry,” she explains. “We can pay higher wages provided that labor costs do not put the business at a severe disadvantage in the hospitality marketplace. Conversely, all ships rise on a rising tide. If minimum wage workers in our community can afford an occasional restaurant meal or getaway, all businesses will benefit.”

“I support an increase in the minimum wage,” she concludes. “Here in Southern Oregon, we have a higher poverty rate and lower median income than in the rest of the state. While the economy is rebounding, stagnant wages mean that many of our families are still struggling to make it through the month.”

In Medford, those issues are particularly keen—but City of Medford councilmember Clay Bearnson is less sanguine about state initiatives like Gov. Brown’s to increase the minimum wage.

“It is like putting a band-aid on an open flesh wound,” he states. Bearnson has worked much of his teenage and adult life in the service industry, he says. “Minimum wage was never intended to be a livable wage,” he points out, and then quickly adds that increased minimum wages has a disparate impact on small businesses. “I believe that it is completely unfair to the local mom and pop stores,” he says. “The only businesses that could weather the inevitable storm from such an increase would be the large corporate stores.”

Gov. Brown will introduce her proposal to increase the state minimum wage over six years when the state legislature starts later this month, and currently signature gathers for 15 Now Oregon are on pace to submit in early March a ballot initiative to increase the minimum wage to $15 per hour by 2019.