A $400 a Month Pay Cut
St Louis' Minimum Wage drops down to $7.70
St. Louis’ minimum wage has reverted back to $7.70, only three months after raising to $10, due to a new state law passed by Republicans in the state legislature and signed by Missouri Governor Eric Greitens.
In 2015, St. Louis passed an ordinance that mandated the city’s minimum wage would increase to $10 by 2017. A court battle ensued between Missouri’s state legislature and the city of St. Louis that could have marked an end to the raise there, but the cover allowed the city’s minimum wage to increase to $10 this past May. The wage was slated to increase again to $11 per hour in January of 2018.
After losing the court case, Greitens defied the court by bringing the issue to the legislature. A recent bill in the Missouri legislature gave Greitens the ability to prohibit cities from creating a different minimum wage than the one used throughout the rest of the state. This new law went into effect as of yesterday, August 28th.
Greitens claims that raising the minimum wage would kill jobs in St. Louis. "Despite what you hear from liberals, it will take money out of people's pockets." he said, according to the St. Louis Post-Dispatch. However, his statement is not supported by any kind of research. In fact, most research supports the exact opposite. For example, The National Employment Law Project released a report in 2016 that took a look at every federal minimum wage increase since 1938. They found that year-over-year employment increased 68% of the time after each wage increase. The industries most affected by minimum wage saw more jumps than anything else, with a 73% jump in retail, and 82% spike in hospitality employment. The only time when minimum wage increase correlated with a decline in employment were in years during or very near recessions. In almost all other cases, there was a positive job growth relationship.
Some local St. Louis business owners welcome the wage cut back, but many others are refusing to comply with the new law. At least 100 different businesses in St. Louis, who increased wages due to the wage increase, will continue to pay their employees at least $10 per hour. They are joined by other states all over the country that have vowed to increase their minimum wage. New York Gov. Andrew Cuomo announced the state would slowly phase in a minimum wage hike that would hit $15 by 2021. California Gov. Jerry Brown agreed to raise his state’s minimum wage to $15 an hour by 2022.
Wanda Roberts, a minimum wage worker in St. Louis, said the new $10 wage helped her bring in an extra $400 dollars a month and really helped the local economy. Now that it’s being reversed, she’s worried that she is going to go back to struggling. Roberts told CBS News that now she is “trying not to worry about how I'm going to pay my rent, how I'm going to pay my bills and how I'm going to have money left over to buy household supplies and food," She is not the only one, roughly 35,000 people are going to see their wages fall.