Should Maine raise its minimum wage?

This November, Maine voters will have a chance to decide whether to increase the state minimum wage to $12 an hour by 2020. This is an important decision with far-reaching implications. On the one hand, raising the minimum wage would bring relief to the many individuals struggling to make it on their current salaries. On the other hand, it might also price many of these same people out of the workforce. While there are tradeoffs to both sides, I fear that raising the minimum wage would harm more people than it would help.

From a justice perspective, it would seem obvious that wages should be raised. A person who works full-time should make enough money to live comfortably. As of now, the living wage in Maine is $10.38 for a single person and $22.19 for someone with a child. The minimum wage is only $7.50. Such disparity highlights the upward battle many face in trying to live on the minimum wage. For a single person to do so is an enormous challenge; for a single parent, it is all but impossible.

But the question remains, would increasing the minimum wage be an effective solution to this problem? The answer is complicated. Of all the people a minimum wage increase would affect, only six percent of those are single parents. Most minimum wage earners live in households with other earners. Think of a teenager who lives with his or her parents, or someone whose spouse is the main provider. If raising the minimum wage is meant to help the most needy, it often falls far short of the task. According to the Employment Policies Institute (EPI), the average household affected by minimum wage increases has a yearly income of $57,316. For this reason, minimum wage increases from 2003 to 2007 did not reduce the poverty rate; most of those affected were not those who most needed a raise.

In addition, the EPI’s analysis shows that raising the minimum wage would eliminate 4,000 jobs in Maine. While one may quibble with the accuracy of future projections, it does correspond to recent patterns of job loss over the country. After raising its minimum wage, Washington D.C. saw 1,400 fewer restaurant jobs than expected, as compared to employment rates in its surrounding area. This six-month period was the city’s largest loss of restaurant jobs in 15 years.

But even if one supports raising the minimum wage, there are still valid reasons to oppose the referendum, as the referendum contains two questions. The first has to do with raising the minimum wage to $12, and the second has to do with tipped wages. Steve DiMillo, owner of the Portland restaurant DiMillo’s, is in favor of raising the minimum wage but rejects the part of the referendum that would require minimum wage increases for service workers and an elimination of the tip credit. Writing in the Portland Press Herald, he explains that eliminating the tip credit would make it difficult, “if not impossible,” for small restaurants to succeed. It could force restaurants to cut back on employees, institute no tipping policies, or even shut down entirely. “I am truly not sure how this referendum question will help tipped employees,” he writes.

As a Maine resident, I care tremendously about poverty in Maine. I hate the fact that so many people struggle to make ends meet on less than a living wage. But I worry that the referendum will not do much in the way of addressing this important issue. The sweeping policy change would hurt too many and help too few.

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