As an organization dedicated to securing basic human needs for all Missourians through policy change, Empower Missouri supports living wages for our state’s workers. On November 5th Missourians will have the opportunity to vote on Proposition A, the Minimum Wage and Earned Paid Sick Time Initiative. Proposition A would increase the minimum wage to $15 per hour by 2026, starting with an increase to $13.75 per hour in 2025. It would also require employers to provide one hour of paid sick leave for every 30 hours worked. This measure is on the ballot thanks to the submission of 210,000 signatures by Missourians for Healthy Families and Fair Wages earlier this year.
The current minimum wage in Missouri is $12.30 per hour. Missourians endorsed a proposition in 2018 that increased the minimum wage each year until it reached $12 per hour in 2023 and further allowed for yearly adjustments based on cost-of-living changes in the Consumer Price Index. However, a more significant and immediate jump in minimum wage is badly overdue; in fact, according to MIT’s interactive Living Wage Calculator tool, a living wage for 1 adult with 0 children would now be $19.11 per hour in St. Louis City, $20.93 per hour in Jackson County (which includes Kansas City), $18.89 per hour in Ozark County, $18.86 in Greene County, and $19.03 per hour in Boone County, just to name a few examples. Those numbers increase significantly for single-parent households.
What is the purpose of minimum wage?
The federal minimum wage was signed into law by President Franklin Delano Roosevelt as part of the Fair Labor Standards Act of 1938 during the Great Depression / New Deal era. The National Employment Law Project describes the FLSA’s stated purpose as keeping U.S. workers out of poverty, serving as a thriving wage, and increasing consumer purchasing power to stimulate the economy. Early minimum wage advocates also noted that “a minimum wage would support the entire wage infrastructure by creating a floor that workers could leverage to achieve higher wages through collective bargaining.”
Unfortunately, according to the Economic Policy Institute, without any mechanisms in place to automatically adjust it for rising prices, the real value of the federal minimum wage reached a 66-year low in 2023 (worth 42% less than its highest point in 1968); this significant loss in purchasing power means that the federal minimum wage today is far from a living wage. 15 states—including Missouri—have indexed the minimum wage to inflation, with six more states poised to follow. 22 states increased their minimum wages in 2024, and the fate of the national Raise the Wage Act is yet to be determined this year.
How many working adults would be impacted by a minimum wage increase in Missouri?
According to the Proyecto de presupuesto de Missouri, increasing the minimum wage to $15 per hour would impact over 562,000 Missouri workers and boost their income by $1,083 annually on average. The organization further specifies that over one in three workers holding marginalized racial identities and nearly one in three working women would see these increases.
Opposition to minimum wage increases often relies on the myth that minimum wage jobs are primarily held by teenagers. Yet the Missouri Budget Project has found that the vast majority of workers who would be impacted by this increase are adults over the age of 20 (86%) who currently work more than 20 hours per week (87%); this demographic includes over 78,000 workers aged 55 or over. This means that more older workers than teenagers would benefit from the change. (That said, teens may be making vital contributions to their household’s overall income and deserve a fair wage as well.)
Notably, 1 in 4 workers whose incomes would increase are parents, and 1 in 4 Missouri kids live in a household that would see a rise in income.
What effect would raising Missouri’s minimum wage have on housing?
The National Low Income Housing Coalition (NLIHC)’s 2024 Fuera de alcance report shows that with our state’s current minimum wage of $12.30 per hour, a Missourian would have to work 55 hours each week in order to afford a modest 1 bedroom rental home at Fair Market Rent. 87% of extremely low-income Missouri households are housing-cost burdened, meaning they spend more than 30% of their income on housing. (This is a staggeringly nation-wide problem.)
Higher minimum wages have a demonstrated positive impact on the number of renters able to maintain their leases. The Consumer Finance Institute found that “increases in state minimum wages significantly reduce the incidence of renters defaulting on their lease contracts by 1.29 percentage points over three months, relative to similar renters who did not experience an increase in the minimum wage. This represents 25.7% fewer defaults post treatment in treated states. To put this into perspective, a 1% increase in minimum wage translates into a 2.6% decrease in rental default. This evidence is consistent with wage increases having an immediate impact on relaxing renter budget constraints.”
Of course, raising the minimum wage alone will not solve the housing crisis in Missouri (and in fact the same Consumer Finance Institute study cited above notes that the positive effects for renters are often eroded over time as landlords react to wage increases by increasing rents). Raising the minimum wage should ideally be accompanied by policies that will increase the supply of affordable housing, boost the Missouri Housing Trust Fund, resource Housing First initiatives, foster community land trusts, and firmly safeguard tenants’ rights.
What effect would raising the minimum wage have on Missourians’ food security and health?
Unsurprisingly, households with minimum wage income increase both the quantity and nutritional quality of the food that they purchase when minimum wage is raised. This improved nutrition access is an urgent need, as Feeding America’s Map the Meal Gap report shows a food insecurity rate of at least 15% in Missouri (representing 924,180 people as of 2022). Food insecurity is a public health issue associated with a vast array of adverse social and health outcomes.
Additional examples of the positive health impacts of increased minimum wage include the following:
- A 2019 study that examined 24 years of U.S. birth data found that an increase in the minimum wage is associated with a small but statistically significant increase in birthweight, driven primarily by increased fetal growth rate.
- A 2020 study found that the effect of a $1 increase in the minimum wage ranged from a 3.4% decrease to a 5.9% decrease in the suicide rate among adults aged 18-64 years with a high school education or less.
How does raising the minimum wage impact the economy?
Opponents of minimum wage increases frequently cite concerns about inflation and higher prices. The Center for American Progress article “Wages and Employment Do Not Have To Decline To Bring Down Inflation” asserts that corporate practices like performing stock buybacks at historic levels are far more responsible for current inflation than wage growth, as many corporations are pulling in record profits. The authors conclude that “those at the top of the income distribution should bear more of the burden of mitigating inflation, rather than repeating the same tired playbook of forcing already struggling low- and middle-income people to suffer more.” An economy is not actually healthy if a significant portion of the population finds that their resources are impossible to live on.
Wage increases also lead to increased consumer spending in their communities and decreased employee turnover. The Proyecto de presupuesto de Missouri projects that passage of Proposition A would inject over $609 million in new wages into our state’s economy. Furthermore, during Missouri’s last minimum wage increase, our unemployment rate decreased at a rate higher than the national average.
Why do we also need an increase in paid sick leave?
According to the Missouri Budget Project, Proposition A’s paid sick leave provisions would reach 728,000 private sector workers (over 1 in 3 in the state).
Paid sick time improves employee job satisfaction and productivity, as well as overall employee health, which has ripple effects for our communities as we continue to struggle with the COVID-19 pandemic. Worker turnover and on-the-job accidents and injuries also decrease with paid sick time. Missourians for Healthy Families and Fair Wages notes that “parents with access to paid sick days are 3 times less likely to skip medical care for themselves and 1.6 times less likely to skip needed medical care for a family member.”
Beyond the business case for paid sick leave, no one should ever be forced to choose between needed wages and their health. And no no one should be forced to endanger their loved ones and their community.
Conclusion
Missouri workers deserve thriving wages and adequate paid sick leave to take care of themselves and those around them. Passing Proposition A would bring us one step closer.
You can visit Vote411 to prepare to vote on November 5, 2024. Please note that the voter registration deadline for this election is October 9th.
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