Arkansas Group Pushes For Minimum Wage Hike Vote

Advocates of raising Arkansas' minimum wage are confident a proposal will be on the November ballot, potentially affecting thousands of Northwest Arkansans.

An alliance of several religious and community groups around the state, going by the name "Give Arkansas a Raise Now," has been trying for months to gather the necessary 62,500 signatures due Monday. The organization's chairman said last week they had about 75,000.

If enough of those signatures are certified, Arkansas voters will decide whether to raise the state's minimum from $6.25 an hour to $8.50 incrementally by January 2017.

State law lags behind the federal minimum, $7.25, which applies only to businesses with at least $500,000 income.

The proposal has a good chance of passing, said Steve Copley, the Arkansas group's chairman, pointing to polling showing majority support.

"That makes us feel pretty confident that if we get the signatures and get it on the ballot, it'll pass," Copley said. "People know others who are working at minimum wage and realize the struggles they have to make ends meet."

Making The Minimum

Millie Roach was a single mother of three in the 1970s and 1980s, when she worked at minimum wage for Walmart, as a meatpacker for another company and elsewhere. The minimum wage then was worth about the same as today's, according to the Pew Research Center.

Money was always tight, Roach said, crediting God with carrying her family through.

"As a matter of fact, sometimes I look back and wonder how I did it," said Roach, who runs a small day care on North Betty Jo Drive in Fayetteville. When the wage rose by a dollar to $2.90 in the 1970s, she said, "I thought I was in heaven."

Today, a person working full-time at the federal minimum wage would make about $15,000 a year, slightly less than the federal poverty level for a family of two.

At this income, even low rent and grocery bills deal a heavy blow, Copley said. Rent of $300 and weekly food costs of $100, for example, would take more than half of that money.

"We're not even talking about an automobile, gasoline, insurance and all those other types of things," said Copley, who is also a United Methodist minister in Little Rock. "I see it as a faith issue. Folks shouldn't have to work hard, play by the rules and not have enough money to make ends meet."

Nationwide, 3.3 million people earned minimum wage last year, or about one person of every 23 in the work force, according to the U.S. Bureau of Labor Statistics. Most work in food service, hospitality and retail.

This proportion was higher in Arkansas at almost 7 percent, which means 44,000 people in the state were working at the lowest wage, including roughly 7,000 in Washington and Benton counties. Only Alaska, Idaho and Tennessee had a higher proportion.

"When you look at Arkansas broadly, we know that Arkansas is a low-wage, low-cost state," said Kathy Deck, economist and director of the University of Arkansas Center for Business and Economic Research. "We have more than the typical number of people making low wages that are not minimum wage as well."

The government doesn't track how many people are paid just above the minimum, but a study from the Arkansas Advocates for Children and Families, which is part of Give Arkansas a Raise Now, found 15 percent of the work force would benefit from the $8.50 level. That's almost 170,000 people statewide, including about 26,000 in Washington and Benton counties.

Who Benefits?

About half of minimum wage earners last year were younger than 24, a statistic critics often point to as a reason not to raise the minimum.

Minimum-wage jobs are meant to be entry-level, on-the-job training, James Sherk, an analyst for the conservative Heritage Foundation, told the U.S. Senate a year ago. Raising the bar makes these doors to better jobs too expensive for businesses to keep open, he said.

"A higher minimum wage is great news for a high school student working part-time to buy an iPhone," Sherk said. "It hurts lower-skill adult workers who need work to support themselves and perhaps their families."

Layne McKellar, a history student at the University of Arkansas, fits the profile of the young minimum-wage worker at McDonald's, though he works full-time.

McKellar's parents help with rent, medical expenses and other costs while he's in school, he said, and he's thankful for the extra support. Life without it would be very different.

"I definitely would not be in school right now, that's for sure," McKellar said, noting middle-aged and older adults also work at jobs like his. "That's not enough to survive on."

Conservatives have resisted a raise nationwide, including Oklahoma's former House Speaker, Rep. T.W. Shannon, R-Lawton, who called for the elimination of the minimum wage during his unsuccessful Senate bid this year.

Research into the impact of increasing the minimum paints a mixed picture. A report earlier this year by the nonpartisan Congressional Budget Office found increasing the minimum to $9 could take away 100,000 jobs. But almost 8 million people would see higher incomes and 300,000 could be lifted out of poverty by the same hike, it found.

"An unintended consequence of raising the minimum wage might be, well, gosh, the job disappeared entirely," Deck said, but she added, "I think it's clear the economy could handle a higher minimum wage."

Expanding the earned income tax credit could be a more precise way to help minimum wage earners without creating incentives to hire fewer people, Deck said. The credit refunds an average $3,000 to low-income working families, according to the Center on Budget and Policy Priorities, which focuses on fighting poverty.

"Employers and people respond to incentives," Deck said. "That particular example doesn't mess with employers' incentive."

In Northwest Arkansas, both Walmart and Tyson Foods are neutral on the question, spokesmen said.

"Clearly this is an important issue," said Kory Lundberg with Walmart, where fewer than 6,000 employees out of 1.3 million work at minimum wage. Tens of thousands of employees are promoted every year, he added, so the starting wage "isn't that important" from the company's perspective.

History Repeating

Critics have fought a government-imposed floor for hourly wages since before it was signed into law in 1938. President Franklin D. Roosevelt made the establishment of wage controls a linchpin of his New Deal efforts against the Great Depression.

Roosevelt and his fellow Democrats had several hurdles to clear, according to a 1939 account published in Duke University's Law and Contemporary Problems.

The Supreme Court just a few years earlier declared wage controls outside state and federal power. Manufacturers complained a minimum would be impossible to enforce and would help their foreign competition. Some business owners claimed they'd be forced to fire everyone they employed.

Roosevelt hit back, tying the push for a minimum wage to abolishing child labor and requiring overtime.

"Do not let any calamity-howling executive with an income of $1,000 a day ... tell you ... that a wage of $11 a week is going to have a disastrous effect on all American industry," he told the public, according to a Labor Department account.

The proposal ultimately passed, ordering employers to pay each employee a quarter per hour, or the equivalent of about $4 today.

The federal minimum has been raised almost two dozen times since to keep up with rising costs, though its buying power generally has declined for 50 years, according to the Pew Research Center. The last increase to $7.25 was in 2009.

Each round of increases brings the same complaints and warnings from opposing businesses, Copley said.

"It seems to be the same argument -- I think it has been since 1938 -- that it's going to cost jobs," he said. "It just does not come to fruition in the same way that's often predicted."