Minimum wage refers to the lowest hourly wage that an employer may legally pay an employee under state and federal law. The controversy over the minimum wage concerns the belief that a living wage should be a fundamental right for all American workers and is opposed by the belief that regulatory control over wage thresholds risk imposing undue economic burdens on employers with potentially deleterious effects on the economy as a whole.
The debate over minimum wage can’t be reduced to simple division between those in support and those in opposition. A federal minimum wage has existed in the United States since 1938, when President Franklin D. Roosevelt passed the provision as just one of the New Deal’s sweeping labor reforms. As such, there is little real debate in today’s public forum about whether there should or should not be a federal minimum wage. This is a generally accepted labor standard.
However, there is tremendous push and pull over how high to set that minimum wage, and economists have openly debated over the potential economic impacts of raising the federal minimum wage to an hourly rate that could accurately be called a living wage. This is the matter which drives today’s controversy. Today, most adult Americans earning a minimum wage–which has been $7.25 since 2009—are living in poverty, are likely eligible for public assistance, and have not seen their wages rise commensurate to the rate of inflation or growth of the American economy in more than a decade. Under these circumstances:
There are likely many influencers who fall somewhere in between these opposing views, such as those who may agree with the call for a raised minimum wage, but may take a more conservative perspective on how fast or how high to raise the actual rate, or those who may philosophically oppose government regulation of businesses, but who may advocate for businesses to pay their employees a living wage.
America’s Industrial Era led to a surge in production. Factory operations, textiles mills, and assembly production lines proliferated throughout the United States in the mid- and late 19th Century. And as immigrant populations flowed into the United States from Italy, Ireland, Russia and elsewhere. The new arrivals found work in these factories and mills, but did so without labor rights or protections. In the absence of these rights or protections, no minimum wage was required of employers.
The period between 1870 and the early 1900s is known as the Gilded Age in American history for its rapid economic growth. The emergence of the railroad industry, expanding settlement in the west, and the explosion of factory production, mining, and finance fostered real wage growth in America. A Census Bulletin from 1890 reports a remarkable 60% wage growth between 1860 and 1890.
Such was this growth in fact, that wages in the U.S. far outstripped those in Europe, and helped to spark the dramatic influx of immigrants from throughout the European continent. With this influx came a readily available and easily exploited source of cheap labor. Though work was more widely available, and wages higher, than in their countries of origin, immigrant workers faced widespread abject poverty.
Conditions in factories and mines were harsh, as suggested by the term “sweated labor” and the closely related term, “sweatshop.” Both of these denote harsh labor conditions including poor worker safety, human rights violations, and poverty wages. All were widespread among working populations as the 19th Century drew to a close. Worker conditions were only magnified by the opulent wealth of the industrial magnates who employed them. As America’s economy grew, so too did wage inequality. These conditions were helping to foment America’s first labor rights movement.
As conditions in the United States were drawing toward confrontation, a similar movement made rapid headway in Australia’s Victoria state. After reports surfaced revealing poor working conditions among Melbourne’s labor class, a group of social reformers organized the National Anti-Sweating League in 1895. Their efforts are paralleled by the emergence of organized labor groups in both Britain and the United States (where the 1890-formed Consumer’s League had already begun to confront labor issues in New York City). However, it was pressure from Melbourne’s labour movement which, in 1896, produced the world’s first government-imposed minimum wage, directed at workers in industries which relied upon sweated labor.
Meanwhile, in the United States, New York’s Consumer League took on sweatshop labor through consumer boycotts. Their influence led to the formation of such leagues throughout the U.S., ultimately leading to the collective formation of the National Consumer League in 1899. In 1908, NCL representatives learned of Australia’s minimum wage laws while attending an anti-sweatshop conference in Geneva. Upon their return to the United States, NCL leaders made minimum wage a key piece of their platform.
As labor conditions in the United States gave way to an increasingly organized labor advocacy movement, the National Consumer League worked in close concert with local groups to promote the cause of a minimum wage. These efforts were especially concentrated in a collaboration between the NCL—with leadership from labor pioneer Florence Kelley— and the Massachusetts-based Women’s Trade Union League (WTUL).
Between 1910 and 1912, these groups led a coordinated effort to institute a statewide minimum wage. Their efforts were granted a national stage with the outbreak of labor protests in Lawrence, Massachusetts. In early 1912, following the passage of a statewide law cutting the working week for laborers from 56 hours to 54 hours, workers learned that they would be bearing the brunt with a $2 a week pay cut.
Thousands—composed significantly of Italian immigrants, many women and children—mounted a strike, protesting in coordinated fashion under the organizational aegis of the Industrial Workers of the World (IWW). The strike lasted for two full months in harsh winter conditions, and included some violent, even deadly, clashes with authorities. But when national reports shone a spotlight on the poor working conditions in Lawrence, it created the necessary pressure to bring about the nation’s first statewide minimum wage law. On June 4th, 1912, Massachusetts became the first state to create a minimum wage, though at this early stage, the state only had the authority to recommend, and not necessarily mandate, these wages. Over the next decade, 15 states and Washington DC would follow suit with their own minimum wage laws.
The state-based minimum wage mandates from this first era were typically directed at women and children, who were exploited in high numbers by the sweated labor system. However, these laws came up against legal challenges by employers resistant to raising wages. During a period referred to as the Lochner Era—so-named for the case of Lochner v. New York (1905), in which it was held as unconstitutional to limit the number of hours that an employer could require an employee to work during a day or week—the Supreme Court tilted heavily against interference with business practices.
According to an opinion written by Supreme Court Justice Stephen Breyer in 2011, the Lochner Era refers to a time “in which it was common practice for this Court to strike down economic regulations adopted by a State based on the Court’s own notions of the most appropriate means for the State to implement its considered policies.”
Such was the case as minimum wage challenges reached the highest court. The Supreme Court of the era routinely struck down state-based minimum wage rules. In the noteworthy instance of Adkins v. Children’s Hospital (1923), the Supreme Court ruled that the District of Columbia’s minimum wage rule interfered with the freedom accorded businesses to negotiate contracts without government intervention.
In the throes of the Great Depression, Americans elected Franklin D. Roosevelt, who promised sweeping change with his New Deal. The set of reforms focused heavily on the needs of American workers. In 1933, Roosevelt made a federal minimum wage a key component of his National Industrial Recovery Act. At the time, he observed, “It seems to me to be equally plain that no business which depends for existence on paying less than living wages to its workers has any right to continue in this country.”
This is the core belief at the heart of minimum wage policies, and in using the phrase “living wages,” Roosevelt would also set the terms for a minimum wage that many advocates still push for today. Here within was the idea that a minimum wage should be sufficient to also constitute a living wage, an amount of paid hourly compensation on which an adult could afford basic living necessities including housing, food, and healthcare.
Even as Roosevelt introduced these sweeping changes, he faced the obstacle of the Lochner Era court. In the case of Schechter Poultry Corp. v. United States (1935), the court ruled federal regulations controlling wages to be unconstitutional. However, political circumstances were about to change. Roosevelt’s resounding electoral victory the following year gave him the mandate to undertake major judicial reforms, the mere threat of which prompted historically pro-Lochner Justice Owen Roberts to shift in favor of the president’s New Deal legislation.
With the matter of wage regulation was raised again in the 1937 case of West Coast Hotel Co. v. Parrish, Roberts tipped the scales toward affirmation of the federal minimum wage. A federal minimum wage was officially enacted by the president in 1938.
In the following years, the majority of states would establish their own minimum wage rates, in many cases exceeding the rate established at the federal level.
While a minimum wage has been the law of the land in the United States for nearly a century, shifting global circumstances have exposed countless workers around the world to labor without an established minimum wage. Many economies in the developing sphere operate without labor protections, and while regulations have abolished sweated labor in the U.S., sweatshop factories and mills are still a reality throughout the world.
The process of globalization, in which the erosion of technological and regulatory barriers has created widespread interconnectedness between the economies of the world, gives American corporations access to pools of labor in countries with little to no worker protections. In these contexts, American manufacturers and producers may rely on laborers who are not guaranteed a living wage.
Even as labor advocates in the U.S. push for wage improvements at home, the controversy over minimum wage also requires consideration of the international economy, the practice of labor offshoring, and the degree to which the absence of labor protections in developing nations impinges upon the concept of a minimum wage, both at home and abroad.
Using our own backstage Ranking Analytics tools, we’ve compiled a list of the most influential figures concerning the issue of minimum wage in the U.S. between 1900 and 2020. Our rankings produced a list of policy-makers, members of the judiciary, and economists who have either materially impacted the evolution of the minimum wage or who today play an active part in extending the visibility of this issue.
Using our own backstage Ranking Analytics tools, we’ve compiled a list of the most influential books on the topic of minimum wage in the U.S. between 1900 and 2020. This resulting list is an interesting mix of works by economists and labor leaders alongside examples of historical fiction and yellow journalism. This mix of texts captures well the push and pull between competing views on what a minimum wage can mean for a whole economy.
|2||Fast Food Nation|
|3||In Dubious Battle|
|4||Nickel and Dimed|
|7||Harvard Works Because We Do|
|9||The World Factbook|
Though a federal minimum wage has existed since 1938, it remains an ongoing subject of controversy specifically because of the perceived gap between the actual minimum wage and the need for a true “living wage.” According to the Fair Labor Standards Act (FLSA), the federal minimum wage at the time of writing is $7.25, and was last raised on July 24, 2009.
43 states have legislated their own minimum wage which is higher than the federal rate. Five states—Alabama, Louisiana, Mississippi, South Carolina and Tennessee—have no state minimum wage laws. Two states—Georgia and Wyoming—carry minimum wages that are lower than the national figures. However, in all cases, it is convention to defer to the higher of the two wages between state and federal, which denotes that states without a minimum wage law adhere to the current federal rate of $7.25 per hour, whereas a state such as California adheres to its own higher rate of $14 per hour.
As a consequence, while the federal rate is $7.25, the average minimum wage pay across the United States was $11.80 as of May 2019. Today, there is an ongoing push by labor groups, activists, and progressive policy-makers to legislate an incremental rise toward $15 per hour. This push is at the center of today’s public minimum wage controversy.
Advocates for the raise argue that the current minimum wage does not equal a living wage, that Americans earning this rate can’t effectively manage the expenses of basic subsistence in America, and that businesses should be able to offset the expense of paying a fair wage. Advocates point to findings that raising the minimum wage will help raise some of these workers out of poverty.
Opponents point to findings that forecast a $15 minimum wage would strain small business expenses, result in higher consumer costs, and ultimately lead to higher unemployment. The issue has been at the forefront of several legislative battles in 2021.
Based on these divergent positions, there is an ongoing tension between, on one side, the stagnancy of the federal minimum wage and the impoverished living conditions for many workers earning the current minimum wage and, on the other side, the imperatives for profitability that drive employers.
Our goal in presenting subjects that generate controversy is to provide you with a sense of some of the figures both past and present who have driven debate, produced widely-recognized works of research, literature or art, proliferated their ideas widely, or who are identified directly and publicly with some aspect of this debate. By identifying the researchers, activists, journalists, educators, academics, and other individuals connected with this debate—and by taking a closer look at their work and contributions—we can get a clear but nuanced look at the subject matter. Rather than framing the issue as one side versus the other, we bring various dimensions of the issue into discussion with one another. This will likely include dimensions of the debate that resonate with you, some dimensions that you find repulsive, and some dimensions that might simply reveal a perspective you hadn’t previously considered.
On the subject of minimum wage, this requires us to consider, in addition to key terms such as “minimum wage,” “living wage,” and “sweatshops,” key organizations which have had a stake in the current debate. For instance, a number of labor groups have played an influential part in advocacy for a minimum wage, including the “Women’s Trade Union League (WTUL).” On the other side of the debate, a number of industry lobby groups and conservative think tanks have played an active role in opposing a raise in the minimum wage, including the “National Restaurant Association” and the “American Enterprise Institute.”
Our InfluenceRanking engine gives us the power to scan the academic and public landscape surrounding the minimum wage issue using key terminology to identify consequential influencers. As with any topic that generates public debate and disagreement, this is a subject of great depth and breadth. We do not claim to probe either the bottom of this depth or the borders of this breadth. Instead, we offer you one way to enter into this debate, to identify key players, and through their contributions to the debate, to develop a fuller understanding of the issue and perhaps even a better sense of where you stand.
For a closer look at how our InfluenceRankings work, check out our methodology.
Otherwise get started with a look at the key words we used to explore this subject:
The key term in our discussion, “minimum wage” refers to the lowest mandated threshold that an employer may pay to an employee under existing federal and state laws. This term yielded a number of labor leaders and economists as top influencers.
While similar to “minimum wage,” a “living wage” refers more specifically to the concept that individuals should be paid a non-poverty wage that affords access at least to basic living requirements. Influencers connected to this terminology tend to be strong advocates for a meaningful raise in the minimum wage.
This general terminology refers to the adoption of regulations aimed at employers, and requiring fair pay practices. Influencers identified through this search include civil servants, activists, and labor attorneys who have contributed to the public movement toward securing a living wage for all workers.
This term refers to the factories and mills where workers—often predominantly immigrant women and children—labored for long hours under unsafe conditions and without fair compensation. Exposure of the abhorrent conditions in sweatshops in rapidly developing economies like the U.S., U.K., and Australia led to growing calls for change, and ultimately served as the tinderbox for the mounting labor movement. The influencers yielded by this term tend to be labor reformers and advocates for workers’ rights.
The Women’s Trade Union League (WTUL) was instrumental in advancing a number of labor causes in the early 20th Century. Their work was critical in bringing the minimum wage from concept to reality, particularly through their efforts in Massachusetts as the New England state passed the nation’s first minimum wage laws. This search term yielded a group of pioneers in both the labor and women’s suffrage movements who played a direct role in the eventual codification of a minimum wage.
A lobby group composed of restaurateurs and major corporations, the National Restaurant Association is merely one example of the type of lobby group which exerts political influence to prevent a rise in the federal minimum wage. Such industry lobby groups often point to economic findings forecasting that raising the minimum wage to a rate such at $15 per hour would strain business operations. Influencers identified through our search include restaurateurs with a significant stake in employment wages in their industry.
Typically, the most vocal and visible detractors of a raised minimum wage are economists and academics from conservative think tanks. Such think tanks often connect closely with industry groups and conservative political action committees, and will frequently take up issues of import to these entities. Much of the research cited in opposition to a minimum wage comes from organizations like the American Enterprise Institute and the American Legislative Exchange Council, who argue that the increased cost to employers would have negative economic repercussions. The following influencers have made an impact on the public discussion through such channels.
If you would like to study this topic in more depth, check out these key organizations...
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