Bloomberg News

Connecticut Lifts Minimum Wage as States Take Lead on Obama Goal

March 26, 2014

Connecticut’s legislature voted to raise pay for the lowest workers to as much as $10.10 an hour, moving it toward the highest minimum wage among U.S. states.

The state’s Democrat-controlled House and Senate approved an increase yesterday of $1.40 an hour to the current minimum of $8.70, through January 2017. Governor Dannel Malloy said he intends to sign the bill today, making Connecticut the first to adopt the level President Barack Obama is seeking nationally.

Connecticut is among at least 34 states that are considering whether to increase the minimum wage, according to the Denver-based National Conference of State Legislatures. That’s shifted the political fight from Congress to the nation’s statehouses, as Obama’s effort to raise the $7.25 federal minimum wage for the first time since 2009 stalls amid Republican opposition.

“The longer this remains gridlocked in Congress the more we’re going to see states and cities acting on their own,” said Jack Temple, an analyst with the New York-based National Employment Law Project, which is advocating for raising the minimum wage. “The economy at the state and local level can’t afford to wait for Congress.”

Democrats have seized on the minimum wage as an issue ahead of November’s state and federal government elections, seeking to give a boost to low-income workers whose pay has stagnated following the recession.

Second Increase

It’s the second time in as many years that Connecticut has voted to do so. Last year, it approved raising the minimum to $8.70 in January 2013 and to $9 in January 2015. The latest measure would add another 15 cents to next year’s increase, with further additions boosting it to $10.10 in three years.

“Those earning minimum wage in Connecticut have too often worked full time while living in poverty,” Senate President Donald E. Williams Jr. said in a statement. “The majority of workers earning the minimum wage are men and women who struggle to provide for themselves and their families. Those men and women deserve an honest wage for a hard day’s work.”

Other efforts have gained momentum in some states in recent weeks. Maryland’s House this month approved raising the minimum wage to $10.10 by 2017, which is now pending in the Senate. Hawaii’s Senate passed a similar increase. And in Massachusetts, House Speaker Robert DeLeo this month threw support behind increasing the state wage in stages to as much as $10.50, after a larger jump previously passed the Senate.

At the start of the year, 21 states and Washington, D.C., set a minimum wage above the federal level. Delaware has since enacted one, and another is currently awaiting action by West Virginia Governor Earl Ray Tomblin. Washington state currently has the highest wage among states at $9.32.

Business Opposition

Nationally, minimum wage increases have drawn opposition from businesses groups, who argue that it makes them more reluctant to hire by pushing up costs. The hiring impact of raising the minimum wage remains a matter of debate. The Congressional Budget Office estimated the effect on employment from a national increase to $10.10 would be anywhere from a “very slight reduction” to as many as 1 million lost jobs.

“The recovery has been very, very slow,” said David French, a lobbyist for the Washington-based National Retail Federation, which opposes the proposed federal increase. “When you’re not creating enough jobs to drive the economy forward, the last thing you want to do is make it more expensive to create jobs.”

Such increases are popular with voters. Sixty-nine percent of Americans, including 45 percent of Republicans, support the president’s call to raise the federal minimum wage to $10.10 over the next three years, according to a Bloomberg National Poll conducted this month. Twenty-eight percent were opposed.

Living Cost

In Connecticut, which had a per-capita income of about $60,800 last year, the highest in the U.S., Democrats said raising the wage was needed to cover the rising cost of living that has left residents slipping behind and increased need for government assistance.

“A low minimum wage forces the government to subsidize the cost of employment while privatizing the profits,” Senate Majority Leader Martin M. Looney said in a statement. “The minimum wage has not kept up with the cost of living and full-time work should pay full-time wages.”

To contact the reporter on this story: William Selway in Washington at wselway@bloomberg.net

To contact the editors responsible for this story: Stephen Merelman at smerelman@bloomberg.net Pete Young, Jeffrey Taylor


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