The debate over raising the minimum wage is heating up in New York and in Congress. A report out by Oxfam America is highlighting benefits the group says would come from an increase to $10.10 an hour. M-I-T Sloan School of Management researcher Zeynep Ton finds investing in people can be a good business strategy.
"There are actually a handful of companies that I studied that offer their employees much higher wages, more training, more stable schedules, and at the same time offering their customers the lowest prices and good service. And they're producing great returns to their shareholders."
Ton says a bad jobs strategy with low wages can actually cost businesses. That’s what Sherry Stewart Deutchman found in her business.
" We can count on the dedicated employees with higher productivity and morale. We save money because we have very low turnover and our training costs are lower because we're keeping people longer. I have a new employee who says this is the first time in her life that she's making enough money that she doesn't have to have two jobs. Can you imagine how loyal and happy she is to be here and how productive she's going to be?"
The Oxfam study shows in Central New York 20-24% of workers would get a raise if minimum goes to $10.10. It would affect women more…just about one in four women are in low-paying jobs, whereas only about 16-17% of men have jobs that pay at or near minimum.
According to the study, raising the minimum wage to $10.10 will not only help millions of American workers earn an extra $1,300 a year – enough to buy 10 weeks of groceries for a family of four – but will also:
- Give nearly 14 million women in America, including 6 million working mothers, a raise;
- Support 14 million American children in low-wage families;
- Provide nearly three million working single parents with greater financial security; and
- Infuse about $32.6 billion into the US economy.
Oxfam President Raymond Offenhieser says the impacts would be varied.
"There's differential costs of living whether you living in Brooklyn versus you're living in a rural area of Upstate New York. So some of that increase will have greater benefit where housing might be a little cheaper in Upstate New York versus the cost of New York City. So we'll probably see differential impacts across the state."
Offenheiser says the study shows a higher minimum wage would reduce poverty, stimulate the economy, and reduce reliance on government programs. Business groups in New York have said higher wages will cost jobs and negatively impact business owners. In New York the state is raising minimum wage at the end of this and next year, eventually to $9.00 an hour. There’s a push both in the state and congress to go to the $10.10 wage right away.
