The Metro Council minimum wage ordinance is the last hope for Louisville workers seeking a wage hike.
That’s according to Democratic Congressman John Yarmuth, who joined advocates at a local business Monday morning.
Yarmuth said he plans to be heavily involved in an effort to pass minimum wage legislation locally.
The Metro Council’s labor committee held its first hearing on the Democratic-led proposal this afternoon as city lawmakers seek to increase the hourly pay of workers to $10.10 over the next three years. Yarmuth said he will provide whatever help is necessary, including testifying before the council at a public hearing.
“The same constituents that they are dealing with I’m dealing with,” he said. “We have mutual interest in the overall standard of living improving.”
Yarmuth’s vocal support comes as local opponents are digging in against the proposal, but a report by the non-partisan Kentucky Center for Economic Policy shows the ordinance would benefit an estimated 22 percent of workers.
The research brief, which analyzed Census data, said over 62,000 workers who make less than $10.10 would be directly affected by the ordinance. Another 24,800 local employees would see an indirect benefit once wage scales were adjusted, the report said.
During the lead up to the wage ordinance’s introduction, some Democrats said young workers should be exempt from the wage hike. But the report said an overwhelming majority of Louisville workers making below minimum wage are adults.
Of those below minimum wage employees, 92 percent are at least 20 years old. People who are older than 50 make up a greater percentage than teenagers.
“That’s contrary to the stereotype many people hold in their heads, which is this is teenagers holding down a part-time or summer job,” said Jason Bailey, director of the Kentucky Center for Economic Policy.
Among the chief beneficiaries of a minimum wage hike would be Louisville’s women. The report finds 55 percent would see an income boost as a result. The raise would also help out 77 percent of workers whose family income is below the poverty line.
Since the bill was first introduced many local employers and business associations have opposed the measure. In their report, Greater Louisville Inc., the city’s chamber of commerce, said it would be better if policymakers sought an earned income tax credit for poorer families over an “artificial” wage hike. Yarmuth said GLI’s idea for a tax credit to give workers more disposable income is a “laughable” plan.
“The problem is that all that is doing is asking the American taxpayer to subsidize businesses that aren’t willing to pay their workers a living wage,” he said. “I don’t think the taxpayers ought to subsidize business models that aren’t valid business models. And that’s what GLI is asking the American taxpayer to do.”
Opponents point to other reports such as one from the Congressional Budget Office, which bolstered Republican opposition to the plan. That report said a $10.10 wage hike could reduce employment by about half a million workers.
Observers tell WFPL that it is difficult to decipher what the actual impact of a wage hike would be on the local economy—but changes should be expected.
“Markets are complex and estimating these things is really difficult, so we don’t frankly know exactly what would happen,” said Eric Schansberg, an Indiana University economist who attended the luncheon.
The labor department found over the summer, for example, states that had raised the minimum wage this year added jobs at a faster pace than those that did not.
Schansberg said he would like to see how the wage hike would impact the local economy adjusted for inflation, for example.
“Louisville is different than Seattle, but we know if the price of something goes up you don’t buy as much of it,” he said. “So you’re going to help some people and you’re going to hurt some people. That’s economics 101, but the question: Is that the best way of going about public policy?”