Low Wages Minimize Rhode Island’s Economy

By FRANK CARINI/ecoRI News staff

Tens of millions of working Americans, from adjunct professors to elderly-care providers to fast-food employees, aren’t paid a living wage. In fact, 26 percent of the U.S. workforce earns less than $10.55 an hour, according to The State of Working America, an ongoing analysis published since 1988 by the Economic Policy Institute.

When the largest U.S. employer, Walmart Stores Inc. — the multinational retailer reported a profit of $120.57 billion in 2015 — holds in-store food drives to help its low-wage employees get through the holiday season, there’s a problem with what many workers are being paid. Yet, when the conservation turns to raising the minimum wage, businesses, mainly of the corporate variety such as Walmart, Dunkin’ Donuts and McDonald’s, lobbyists and chambers of commerce all claim jobs will be lost and the economy ruined…

Douglas Hall, director of economic and fiscal policy at the Providence-based Economic Progress Institute, told ecoRI News during a recent interview that a “preponderance of evidence” shows that jobs aren’t lost when the minimum wage is increased. He noted the research of John Schmitt at the Center for Economic and Policy Research — Schmitt has said the employment effect of the minimum wage is one of the most studied topics in all of economics — and work done by the Political Economy Research Institute at the University of Massachusetts, Amherst.

“Opponents like to tell the story that minimum-wage increases are job killers,” Hall said. “They’ll say its Economics 101. Yeah, but there’s a reason why we study beyond Economics 101.”