2.5 Million Southerners Would Benefit From An Increase In The Minimum Wage

2.5 million Southern workers would benefit directly from an increase in the federal minimum wage to $7.25 per hour.

Texas is home to the largest number of potential beneficiaries (658,000) in both the nation and the South. When potential beneficiaries are measured as a percentage of a state's workforce, the Gulf Coast states of Alabama, Mississippi and Louisiana would rank among the nation's biggest winners. Roughly 10 percent of Alabama's workforce would enjoy higher pay as the result of an increase in the minimum wages, as would 9.5 percent of Mississippi's workforce and 9.1 percent of Louisiana's workers.

These findings come from a new study by Heather Boushey and John Schmitt, economists at the Center for Economic and Policy Research in Washington, D.C. An impact analysis of a minimum wage increase, the study describes the demographic characteristics of minimum wage workers and shows how an increase could enrich their personal finances.

Three key findings emerge from the report:

1. Without federal action, the purchasing power of the federal minimum wage, adjusting for inflation, soon will fall to its lowest level since 1955. Even an increase to $7.25 would return the minimum wage only to where it was in the mid-1980s.
2. Minimum wage workers contribute a large portion of their family's income. Half of all minimum-wage workers are prime-age workers (ages 25-54). In families with a minimum-wage worker, that worker contributed 68 percent of the family's 2002 income.
3. The extra $1,500 that a full-time minimum-wage worker would earn as a result of a wage increase is the equivalent of 8.8 months of groceries or 10.5 months of heating an utility bills, based on typical consumer expenditures for low-income families.