Two years after rejecting it, city council members will discuss a minimum wage hike for Oberlin municipal workers.
In a Nov. 21 work session, council will consider increasing the minimum wage — which is $8.10 per hour in Ohio and $7.25 per hour federally — to $12.50 per hour for workers 18 and over. Workers under 18 would receive 10.10 per hour.
Oberlin has about 110 full-time municipal workers, most of whom earn more than the minimum wage. A hike would primarily effect about 35 part-time municipal workers, many of whom work seasonally.
A hike wouldn’t affect private employers, councilwoman Sharon Soucy stressed on Monday. She said it would only cost taxpayers roughly $25,000 more annually. Oberlin has an approximately $9.4 million general fund budget this year.
Soucy unsuccessfully sought approval from council to get law director Jon Clark to draft an ordinance calling for a hike, rather than holding a work session.
Councilwoman Sharon Pearson said she wasn’t prepared to vote on authorizing a draft ordinance, saying she lacked information. Pearson said she was surprised by the proposal and noted it wasn’t on the agenda.
Soucy countered that a hike was uncomplicated and she was concerned the issue would get bogged down in technicalities at a work session and rejected. Council in 2014 rejected a proposed hike with little discussion.
“To me, there are two issues: Is it the right thing to do and can we afford it,” Soucy said, who posed the increase as a way to locally address income inequality in America.
The richest one percent of Americans controlled 42 percent of the nation’s wealth in 2012, according to a May study by economists Emmanuel Saez and Gabriel Zucman of the University of California at Berkley. The richest 0.1 percent controlled 22 percent of the wealth.
“Anything we can do in our city, it seems to me, to demonstrate that we care about that faulty distribution of wealth and treat our workers exceptionally well and put ourselves on the map for that reason, to me, it’s well worth it,” Soucy said. “We can afford this. It’s a minimal amount. So it becomes a question of whether you think it’s the right thing to do or not.”
In response to income inequality and wage stagnation, 18 states, the District of Columbia, and cities including Lexington, Ky., and Oakland, Calif., have hiked their minimum wages since 2013, according to the White House.
Sen. Bernie Sanders (I-Vt.) last year sponsored a bill calling for a $15 federal minimum wage in solidarity with the Fight for $15, a national group of minimum and low-wage workers seeking a $15 per hour minimum wage.
President Barack Obama supports raising the federal minimum to $12 per hour by 2020. Republicans have blocked a raise and in response Obama raised the minimum for federal contractors to $10.10 per hour by executive order.
“To everyone in this Congress who still refuses to raise the minimum wage, I say this: If you truly believe you could work full-time and support a family on less than $15,000 a year, go try it,” Obama said in his 2015 State of the Union address. “If not, vote to give millions of the hardest-working people in America a raise.”
Proponents of raising the minimum say it has an economic ripple effect and decreases job turnover. Opponents say it decreases jobs and does little for low-wage workers because hiking their annual income can make them ineligible for anti-poverty measures like receiving food stamps.
Studies on the issue are divided.
A 2010 study by the Southern Economic Journal found federal and state minimum wage hikes between 2003 and 2007 had little effect on state poverty rates and that hikes may have “adverse employment effects” for the working poor. Instead of raising the minimum wage, the study recommended Congress increase eligibility for the Earned Income Tax Credit, which reduces federal taxes for low and moderate-income workers.
However, that study was contradicted by an August study by the Institute for Research on Labor and Employment at the University of Berkley that looked at minimum wage hikes nationally between 1979 and 2014.
It found “employment effects of U.S. minimum wage policies on low-wage employment to date have been fairly small.” A 2010 study by the institute that looked at hikes between 1990 and 2006 found, “no detectable employment losses” due to increases.
The nonpartisan Congressional Budget Office in 2014 reported hiking the federal minimum to $10.10 by this year would have increased wages for about 16.5 million low-wage workers. The CBO said the hike would’ve reduced total employment by about 500,000 workers, or 0.3 percent.
Evan Goodenow can be reached at 440-775-1611 or @GoodenowNews on Twitter.