To help you understand your rights and protections, the City of Philadelphia is creating action guides on federal policies. The action guides include facts, ways you can help, and other resources.

Currently, 31 states and 41 cities in the United States have minimum wage levels higher than the federal minimum wage of $7.25 per hour. In addition, private sector leaders such as Amazon, Jefferson University, and Cooper University Health Care have raised their minimum wages to $15 per hour.

Raising the minimum wage leads to increases in income and decreases in poverty for workers making at or near the minimum wage. Even for higher paid employees, increasing the minimum wage can have a positive effect on earnings. Typically wages will rise for anyone earning within $3 of the new minimum wage.

The City cannot increase minimum wage alone. Philadelphia is preempted by PA State Act 112 from passing any minimum wage law. This means that minimum wage changes must occur at the state level. We need action from the Pennsylvania legislature to raise wages for our city’s residents who work but live in or near poverty due to low wages and rising costs of living.

Learn more about minimum wage below. Then find out about how you can contact your representative and other ways you can take action.


Know the facts

Is Pennsylvania’s minimum wage higher than the federal level?

No. Pennsylvania’s minimum wage is $7.25, which is the federal level minimum wage.

This rate has been unchanged for the past 10 years, while cost of living has risen more than 13 percent since 2009.

All states surrounding PA have higher minimum wages.

New York is increasing their federal minimum wage to $12.50 by 2020. Ohio, Delaware, and West Virginia have federal minimum wage rates at $8.55, $8.75, and $8.75, respectively. The District of Columbia plans to increase its minimum wage to $15 by 2020, and New Jersey plans to increase its minimum wage to $15 by 2024.

What do other states and cities minimum wage policies look like?

Minimum wage policies vary.

States and cities across the country have minimum wage policies that include either a one-time increase with additional increases tied to increases in costs of living, incremental increases with additional increases tied to increases in costs of living, or one-time increases as needed. Research shows that incremental increases to a higher than federal level minimum wage allows both states and business to adjust more slowly.

Some states have different minimum wage rates or ramp up timelines depending on the size of businesses or whether or not employers provide health benefits.

For example, California businesses with fewer than 25 employees have a delayed schedule to $15 per hour. Arizona exempts all businesses that gross under $500,000. In Nevada, employers who do not offer qualified health benefits pay $8.25 an hour — higher than the federal minimum wage.

Many states also have different higher than federal level minimum wages for tipped employees.

A tipped employee is an employee that engages in an occupation in which he or she customarily and regularly receives more than $30 per month in tips.

More than 50 percent of states who have a minimum wage higher than the federal minimum have a lower minimum wage requirement for tipped employees. In Pennsylvania, the tipped employee minimum wage is $2.83, which is above the $2.13 federal minimum wage for tipped employees.

States and municipalities have also typically exempted the following populations from minimum wage requirements: federal employees, babysitters, salespersons, agricultural workers, and people with disabilities. States and municipalities have based exempt populations on some federal exemptions.

What is the impact of minimum wage on unemployment?

New studies covering the recent explosion of minimum wage policies, using improved measurement strategies, find strong evidence that increasing the minimum wage does not lead to a loss in low-wage jobs and in fact does raise incomes.

Increasing the minimum wage can have other positive effects: New research finds increasing the minimum wage leads to a drop in recidivism for former prisoners and a drop in crimes such as property or drug crimes.

Sectors that employ many minimum-wage workers, such as the food service sector, have not been harmed by increased minimum wages. Pennsylvania’s neighboring states all have higher minimum wages, and in their food service sectors, wages have increased and employment has increased faster than in Pennsylvania’s food service sector.

Do higher wages push families off of the "benefits cliff," raising household incomes above the eligibility threshold for public assistance programs?

Studies suggest that raising minimum wages can be complementary to public assistance programs, such as the Earned Income Tax Credit. This study shows that higher minimum wage increases EITC benefits for families in deep poverty, and the Pennsylvania state administration estimates that raising the minimum wage to $12.25 would recover $100 million in state entitlement costs.

The Center for American Progress reported that raising the federal minimum wage to $10.10 would reduce spending on the Supplemental Nutrition Assistance Program (SNAP) by $4.6 billion. The Economic Policy Institute concluded that increasing the minimum wage to $10.10 would decrease annual government spending on income-support programs and save taxpayers $7.6 billion.

Will raising the minimum wage reduce working hours?

For most employees, working hours do not decrease when minimum wage increases.

Studies of minimum wage increases in cities and states across the United States find consistent evidence that raising the minimum wage increases incomes without reducing hours worked, especially for low-income families. A study in Seattle found that although people working the least number of hours did work fewer hours after an increase in minimum wage, the hourly wages for this group went up enough that their overall incomes remained the same. However, the same study shows that other workers saw an increase in overall wages and no significant decrease in hours.

What is the impact of a higher than federal level minimum wage in PA on Philadelphians?

If the minimum wage were increased by $1.00 per year to a maximum of $12.25: 69,446 Philadelphia residents would benefit immediately from the increase. By 2024, 188,995 Philadelphians — 37 percent of the eligible workforce — would have been affected by the wage increase.

If the minimum wage were increased by $1.30 per year to a maximum of $15.00: Over 77,000 Philadelphia residents would benefit immediately from the increase. By 2024, over a quarter of a million Philadelphia residents — nearly half of the workforce — would be affected by the wage increase.

Increasing the minimum wage will be crucial to 63,000 Philadelphians, ages 20 to 65, who work but currently live in or near poverty.

Source: City of Philadelphia analysis of 2016 American Community Survey data

Which occupations in Philadelphia may be the most impacted by an increase in minimum wage?

According to the City of Philadelphia’s Department of Revenue, occupations that typically pay minimum wage include: cashiers; nursing, psychiatric, and home health aides; cooks; retail salespersons; personal care aides; food preparation workers; janitors and building cleaners; childcare workers, laborers and freight, stock, and material movers; security guards; teacher assistants; and housekeeping cleaners — to name a few. There are additional occupations that typically pay minimum wage not listed here.


Make sure your voice is heard. It is critical that Philadelphians contact their representatives and share your opinion on legislation that would help raise the minimum wage.

Contact

Contact Pennsylvania state legislators to support Governor Tom Wolf’s proposal of a $12 per hour minimum wage. Governor Wolf called for taking Pennsylvania’s minimum wage from the federally established $7.25 per hour to $12 per hour in 2019, and gradually raising it to $15 by 2025. Governor Wolf’s administration projects that this plan would provide as many as one million Pennsylvania workers with total additional income of $3.5 billion annually.

Attend

Join Fight for $15, an advocacy organization that started in 2012. Fight for $15 organizers advocate for a $15/minimum wage.

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