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Raising Wisconsin’s minimum wage would significantly cut poverty. So why is it still $7.25?
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Raising Wisconsin’s minimum wage would significantly cut poverty. So why is it still $7.25?

Fight for 15

Evette Gardner speaks to the crowd during a Fight for $15 protest outside the McDonald’s on Park Street in Madison, Wis., in 2015. Efforts in recent years to raise Wisconsin’s $7.25 an hour minimum wage have stalled in the Legislature.

For 26-year-old Olivia McKnight, raising the minimum wage to $15 an hour would transform her life.

As a full-time Popeyes employee in Milwaukee, McKnight makes $10 an hour. This isn’t nearly enough to support herself and her three children. She also works a second job. The long work hours have forced her to miss out on time spent with her children, including holidays and key life moments.

For 29-year-old James Rudd, who earns more than $15 an hour now, he is finally able to pay for the things he needs. And he now fights for all workers in Wisconsin to reach at least $15 an hour.

In contrast with McKnight, Rudd’s maintenance job at AT&T’s Milwaukee office cleaning floors and changing light bulbs has made his life easier. He can afford health insurance, bus fare and to keep current on his bills — all of which were out of reach when he earned $7.25 or $8 an hour.

That’s where McKnight is now.

“I try to provide for my family day to day, month to month, paying rent, paying electric, lights, and trying to find babysitters,” she said. “It's definitely hard, it takes the majority of my time away, and it’s like I’m almost working for pennies.”

Roughly 1 million hourly workers nationwide earn the federal minimum wage of $7.25 an hour or less. Like others fed up with low earnings, McKnight recently joined the Fight for $15, a global political movement working to increase the minimum wage for all underpaid workers.

In Wisconsin, where the racial wealth and income gaps are some of the greatest in the nation, many feel raising the minimum is long overdue. According to a 2019 Marquette Law School Poll, 55% of Wisconsinites support raising the minimum wage, while 39% oppose it. And Black women like McKnight are among those who would benefit the most from it.

Black and Hispanic women are more than twice as likely as white men to make less than $15 per hour, according to calculations by The Washington Post using federal jobs data. About 46% of Hispanic women and 39% of Black women earn less than $15 an hour, while only 18% of white and Asian men earn less than $15 per hour. In Wisconsin, an estimated 43.7% of residents earn less than $15 an hour.

Because of grassroots movements like the Fight for $15 and growing political support, eight states and the District of Columbia have already passed legislation to raise the wage to $15 an hour, most recently Florida, according to the UC Berkeley Labor Center.

But not Wisconsin. It is among 21 states whose minimum wage matches the federal level of $7.25 an hour. In 10 other states, the minimum is higher but still under $10, the UC Berkeley Labor Center reports.

Legislators, activists and community members have organized, lobbied and proposed changes to the federal and state-level wages for years, well before Democrats tried unsuccessfully to include a federal $15 minimum wage in the pandemic relief package passed in February 2021. `

In January, Democrats reintroduced the Raise the Wage Act, which would gradually increase the federal minimum wage to $15 per hour by 2025 and end pay below-the-minimum wage for tipped workers. Under the bill, the minimum wage would increase immediately to $9.50 an hour, then to $11 per hour next year, $12.50 in 2023, $14 in 2024 and then $15 in 2025. A similar bill was introduced in 2019 but never cleared the GOP-controlled Senate.

The main reason minimum wage bills have stalled: Opponents argue that raising it would force many businesses to close or cut their workforces, resulting in fewer jobs.

A recent Congressional Budget Office report estimated that implementing a nationwide minimum of $15 an hour would lift nearly 1 million people out of poverty — but employment would be reduced by 1.4 million workers. Wisconsin Manufacturers and Commerce, a powerful business lobby, argues raising the minimum wage would reduce opportunities for entry-level workers by making it more expensive for companies to hire them.

James Rudd

James Rudd is seen outside of his workplace at the AT&T building in downtown Milwaukee, where he works as a janitor, on July 13, 2021. Rudd is fighting to double the minimum wage in Wisconsin from $7.25 per hour to $15 per hour. Rudd says he now makes more than $15 an hour — and thinks everyone should make at least that. “Fifteen dollars is just a start. We want to take vacations. We want to be able to live the American dream,” he says.

Economic disparities huge

Low wages have long been a problem for workers of color in Wisconsin. Black median household income in Milwaukee has fallen by almost 30% since 1979. In fact, the Black median household income of $29,655 is the lowest among the top 50 U.S. metropolitan areas, and it is only 42% of white median household income, which in 2018 was $70,561. That’s according to a 2020 study by the University of Wisconsin-Milwaukee Center for Economic Development, which controlled for cost of living while comparing metropolitan areas.

“I think that’s a profound finding,” said Marc Levine, co-founder of the center who led the study. “It tells us a lot about not only our history, but about what’s happening today in Milwaukee and how little progress it has made.”

Levine’s recent research focuses on Black communities and how they fare in the nation’s 50 largest metropolitan areas on issues including housing segregation, incarceration, poverty and income. On nearly every measure, Milwaukee comes out at or near the bottom. Wisconsin’s largest city, he said, “represents the archetype of modern-day metropolitan racial apartheid and inequality.”

Differences in educational achievement do not account for the disparities in income. According to Levine’s report, a white high school dropout is over twice as likely to be employed in Milwaukee than a Black high school dropout. In fact, white high school dropouts have a higher employment rate than Black workers who have graduated from high school.

“So when we talk about raising the minimum wage and the Fight for 15, you can see how important that is for Black Milwaukee given the very low wages that are earned by Black males,” Levine told Wisconsin Watch. “My estimate is that almost 40 to 45% of Black workers in Milwaukee would benefit from raising the minimum wage to $15 an hour.”

Subeck press conference

Wisconsin state Rep. Lisa Subeck, D-Madison, speaks at a June 17, 2021 press conference at the Wisconsin State Capitol to promote her proposal, co-sponsored by state Sen. Melissa Agard, D-Madison (center), to raise the state’s minimum wage to $15 per hour. Wisconsin’s $7.25 an hour rate — which matches the federal minimum — has not risen since 2009.

Lack of raise ‘shameful’

For Wisconsin state Sen. Melissa Agard, the issue of raising the minimum wage is a moral one. Far too many people in the state who are working 40 hours a week — and who are disproportionately people of color — are still unable to take care of themselves and their families with dignity, she said.

On June 17, Agard announced she would reintroduce legislation to raise the minimum wage to $15 in Wisconsin. She said it is “embarrassing” and “shameful” that the minimum hourly wage in the state has been frozen at $7.25 since 2009.

Many minimum-wage workers are forced to rely on public assistance programs, which cost the state billions. Addressing income inequality, in part by raising the minimum wage, could actually save the state money in respect to government-funded assistance programs because people would be able to better support themselves and their families, Agard said.

“Increased wages mean less people (are) reliant on government assistance for food, health care and other essentials,” she said. “In the richest country on the planet, no one should work full time and live in poverty.”

The UC Berkeley Labor Center found that 45% of workers in Wisconsin who would receive a pay boost if the Raise the Wage Act were passed are currently enrolled in one or more public assistance programs, including Medicaid, FoodShare and the Earned Income Tax Credit. Those working class employees are supported by an estimated $2.4 billion in public assistance programs in Wisconsin, the Labor Center estimated.

Wisconsin Manufacturers and Commerce is a major voice of opposition to raising the minimum wage. The group argues that the biggest issue facing employers is a lack of skilled workers, and that the state should focus on training workers and incentivizing young professionals and college graduates to remain in the state.

The powerful business group did not respond to requests for comment. But in its legislative agenda, WMC stated that “raising the minimum wage will increase the cost of employing entry level workers, resulting in fewer job opportunities for workers entering the workforce who need to build skills and experience for their career.”

In addition, the Congressional Budget Office projected that the reduction in employment would increase spending for programs such as unemployment compensation. It also projected the costs of goods and services would increase, leading consumers to limit purchases and employers to reduce their employment.

After attempting to push through the bill in 2015 and 2017, the senator invited her Republican colleagues to join her. “Everyone deserves economic security,” she said.

Higher tipped wage proposed

Another Democratic-backed proposal in Wisconsin would ensure tipped employees currently making $2.13 or $2.33 an hour are compensated the same minimum wage as the rest of the workforce. Sen. Chris Larson of Milwaukee and Rep. Francesca Hong of Madison are sponsors of the measure.

“This wage is simply not enough,” Larson said at a March press conference introducing the legislation. “Up to 60% of tipped workers report that their tipped wages are too low to meet unemployment thresholds, and 46% rely on public assistance for basic survival.”

Larissa Joanna, a restaurant worker and single mother of two, said such a change would have helped her. She described getting paid the sub-minimum wage at her past restaurant jobs as dehumanizing. Having to rely so heavily on tips from customers to support her family made her stressed and worried.

For the past three years Joanna has worked as a manager at a Madison restaurant that starts every employee at the $7.25 minimum wage, plus tips. But she continues to fight for a higher wage for others because she knows what it’s like to work hard and yet not earn enough to support a family.

And she can never make up for lost time with her sons — one of whom has autism, attention deficit hyperactivity disorder and speech delays — while she worked two jobs just to make ends meet.

“Unfortunately I had to spend that time away from my children, and if we were all making better pay it would be beneficial for everyone as a whole including our children,” Joanna said.

Said Rudd: “Fifteen dollars is just a start. We want to take vacations. We want to be able to live the American dream.”

Wisconsin Watch reporters Zhen Wang and Isaac Wasserman contributed to this story, which was produced as part of an investigative reporting class at the University of Wisconsin-Madison School of Journalism and Mass Communication under the direction of Dee J. Hall, Wisconsin Watch’s managing editor. The nonprofit Wisconsin Watch (www.WisconsinWatch.org) collaborates with WPR, PBS Wisconsin, other news media and the UW-Madison School of Journalism and Mass Communication. All works created, published, posted or disseminated by Wisconsin Watch do not necessarily reflect the views or opinions of UW-Madison or any of its affiliates.

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