Today’s entry: If so few people earn minimum wage and if union employees benefit the most from the raising of it, the average starting wages must be much higher than $10/hr. What’s the going hourly rate for entry-level work? And based on that information when would the increase in rate impact more minimum wage workers than union workers?
Bottom Line: Before addressing questions, I’ll reset with the specific information that’s pertinent to what you’re asking. Today’s minimum wage increase in Florida, to $10 per hour, based on the passage of last year’s constitutional amendment impacts far more non-minimum wage employees than not. In my analysis, there are approximately only 200,000 Floridians currently earning minimum wage. A total of 646,000 Floridians are seeing a pay bump today with the minimum wage increase. This is where the unions come into play. Many union contracts include “kickers” for their employees when the minimum wage is increased.
In other words, union employees with these types of agreements, which earn well above minimum wage, are promised compensation that’s at a set level above whatever the going minimum wage is in the state or city in which they work. This is despite the average union hourly wage checking in at $32.68/hr. The reality is with today’s minimum wage increase, that’s who's likely benefitting the most from this increase.
According to ZipRecruiter, the average entry-level hourly wage in Florida is currently $12.59/hr. It’s also clearly still far higher than the $10 per hour new rate as of today. This further helps illustrate the general pointlessness of having a minimum wage, to begin with. Due to market forces, the average employer in Florida has been paying entry-level employees 46% more than had been mandated. A number that’s only been on the rise due to the labor shortages currently being experienced throughout the state.
In addressing your second question, as to when the minimum wage increases would impact more minimum wage workers than not, the scheduled increase for Florida’s minimum wage based on last year’s amendment is $1 more every September 30th until 2026, when it gets to $15/hr with the minimum wage set to once again adjust based upon inflation subsequent to reaching $15 per hour.
Now, based on today’s entry-level wages, the answer as to when most Floridians earning minimum wage would benefit from the increases, we’d be looking at September 30th, 2024. But even that’s a big “if”. With employers rapidly raising starting salaries, highlighted by the country’s largest employer, Wal-Mart, recently raising average starting wages to $16.40 per hour, it’s possible that Florida’s minimum wage amendment’s increases will always benefit non-minimum wage workers more than those earning it...which was the plan of the unions behind it all along.
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Parler & Twitter: @brianmuddradio