Proposition B Pro: Raising minimum wage is good business

First, providing people with an honest wage for an honest day’s work is a good and righteous thing to do. It speaks to the fundamental American value that if you work hard and play by the rules, you ought to be able to put food on the table and earn a better life for your family.

Unfortunately, the cost of living has gone up so much in the nearly 10 years since the minimum wage was last increased that its real value is only about $4 an hour. Can any of us imagine trying to support our families – or even just ourselves – on $4 an hour?

But raising the minimum wage isn’t just good for people and families. It’s also good business in a much more practical, dollars-and-cents way.

We have been trained to believe that if you raise the minimum wage, it will force businesses to cut jobs and maybe even close their doors. Every time there is a discussion about raising the minimum wage, opponents trot out studies and reports predicting just that. It’s scary stuff.

But the good news for business is that it is simply not true.

There are 22 states that already have raised their state minimum wage above the federal level, and those states haven’t lost jobs since raising the minimum wage. They have gained jobs. In fact, the nonpartisan Fiscal Policy Institute found that the job growth was faster in states that had raised the minimum wage than it was in states that remained at the federal rate of $5.15 an hour.

And states that raised the minimum wage didn’t see small businesses close down or leave for more business-friendly waters in lower-wage states. In fact, the number of small businesses in higher minimum wage states grew at a faster rate than in states still at the federal level.

I know what you’re thinking. This flies in the face of everything we have ever been told about the minimum wage and its impact on business. How can this be possible?

There are two things you can count on when you give a low-wage worker an increase in pay. The first is that they will spend this newfound money; the second is that they will spend it in the local economy.

Low-wage workers don’t have the luxury of putting a raise into their savings accounts. When a low-wage worker gets a few extra dollars in her pocket, she isn’t going to splurge on a vacation to Hawaii or Jamaica. She’s going to get her kid the sneakers he needs for the new school year, she’s going to get the grocery shopping done, and maybe, if she’s lucky, she might have a few dollars left over each month to take the kids to a movie.

The point is that she will spend that money at our local businesses, both small and large. The Blunt Administration’s budget department calculated that raising the minimum wage would pump more than $21 million of new spending into our economy. That’s an economic shot in the arm that will help all of us, not just those low-wage workers who desperately need a raise.

Raising the minimum wage is a long- overdue step that will help approximately 256,000 Missourians who are struggling to get by, and it will help make our economy stronger.

It’s the right thing to do for the people – and businesses – of Missouri.

Jim Kabell is business manager for Teamsters Union, Local 245.