Department of Human Services Highlights Need for Minimum Wage Increase to Help End Cycle of Poverty
Department of Human Services (DHS) Secretary Teresa Miller joined Senator Vincent Hughes, Senator Art Haywood, Representative Patty Kim, legislators from the State Senate and House of Representatives, SEIU Healthcare Pennsylvania, and direct care workers to highlight the need for a minimum wage increase to support working Pennsylvanians.
Governor Tom Wolf’s 2019-2020 proposed budget includes increasing the minimum wage to $12 with a pathway to $15 – the first increase to Pennsylvania’s $7.25 wage in a decade.
“Throughout Pennsylvania, the 2 million workers earning less than $15 an hour are doing the jobs that keep our economy going,” Secretary Miller said. “People may try to get ahead, but low wages can make that impossible. A $7.25 minimum wage is perpetuating the cycle of poverty. We have created a system built on inequities that traps people into dependence on public assistance, and then shames them for circumstances beyond their control. We need to stop punishing people who work minimum and poverty wage jobs and instead recognize the value that all workers create for Pennsylvania’s economy and our communities.”
Pennsylvania’s $7.25 minimum wage is among the lowest in the country and the mid-Atlantic region. Twenty-nine other states, including all that border Pennsylvania, have raised their minimum wages since Pennsylvania’s wage was last increased.
Governor Wolf’s proposal will raise the minimum wage to $12 an hour effective July 1, 2019. After this, a 50-cent annual increase will occur until reaching $15 an hour in 2025. A worker making $7.25 an hour currently makes about $15,000 annually before taxes – below the Federal Poverty Threshold. Pennsylvania’s minimum wage is keeping low and minimum wage workers in a cycle of poverty and forcing people to rely on public assistance programs.
The proposal also includes fair minimum wages for tipped workers, who currently make just $2.83 an hour and must survive on income made from tips. Two-thirds of tipped workers are women, more than a third of whom are also mothers. Forcing them to rely on tips to make ends meet for their families perpetuates the gender pay gap and poverty rates among women and children.
A study by the Economic Policy Institute found that raising the federal minimum wage to $12 an hour by 2020 would reduce public assistance spending by $17 billion annually. In Pennsylvania, raising the wage to $12 this year will lead to more than $150 million saved on Medicaid spending in fiscal year 2019-2020.
Minimum and low-wage workers fill critical jobs in our economy and communities and, in many cases, these jobs allow other workers to go to work and participate more freely in the economy. Child care workers and direct care workers make this possible by allowing parents and caretakers to go to work knowing that their child, parent, or other loved one is being cared for or educated, in a safe, loving environment. However, half of these workforces receive some level of public assistance, creating additional stress on workers charged with caring for some of our most vulnerable Pennsylvanians. Much of the savings from the reduced strain on public assistance programs made possible by a minimum wage increase will be reinvested to support wage increases for these career paths.
“The child care and direct care workforce touch each of us at points we will all experience – childhood and our senior years,” said Secretary Miller. “These jobs keep our economy moving by allowing people like us the opportunity to go to work every day or go to sleep every night knowing our loved one is under the care of someone who values them as much as we do. We cannot expect that if the people who work these jobs are struggling to make ends meet.”
Secretary Miller was also joined by representatives from SEIU Healthcare Pennsylvania, who shared the challenges of staying in a field they care for while living on wages that do not meet the cost of living.
“I love taking care of people, but I hate that I don’t make enough to take care of myself and my two children,” said Grace Johnson, a caregiver from Western PA who has received just one pay increase in her 13-year career. “I hate that I have to depend on government agencies and food banks and welfare and Section 8. It’s hard to work a job that you love but doesn't support you financially.”
“Pennsylvania is in a care crisis and we cannot reverse it until we make sure there are enough women and men to do this important work,” said Matthew Yarnell, president SEIU Healthcare Pennsylvania. “As long as we allow direct care workers to live in poverty, isolated and without proper training, we are failing our seniors and people with disabilities.”
For more information on Governor Wolf’s minimum wage proposal, visit www.budget.pa.gov.