On New Year’s Day, Oregon’s minimum wage will jump 40 cents to $6.90 per hour, boosting the wages of tens of thousands of Oregonians, according to the Oregon Center for Public Policy, a non-profit research group.
In November Oregon voters passed a ballot initiative to increase the minimum wage beginning January 1, 2003. The initiative also indexed the minimum wage to inflation, which means it will continue to grow each year.
“Over the long-term, Oregon’s minimum wage has not kept up with inflation,” said Jeff Thompson, economist and analyst with the Oregon Center for Public Policy. “Each year families working at or close to the minimum wage find it harder to make ends meet because prices go up. Indexing the minimum wage to inflation stops the erosion of its value.”
A full-time worker at the new minimum wage will earn about $14,300, which is below the poverty level for families of three or more. “Many families with full time workers will continue to struggle to make ends meet,” said Thompson. “Raising the minimum wage eases that burden, and indexing it means families won’t have to work more hours each year just to stay in place.”
“Despite this increase, the purchasing power of Oregon’s minimum wage remains below levels seen in the 1960 and 1970s,” Thompson added.
In Oregon housing costs continue to be high relative to income. “Landlords don’t wait to increase rents just because their tenants haven’t had a raise,” Thompson said. In Oregon over 150,000 renters are paying more than 35% of their income as rent.
Thompson noted that Oregon has likely the highest hunger rate in the nation, and that work does not necessarily prevent hunger. “Raising the minimum wage makes it easier for thousands of Oregon families to put food on the table. Making sure the minimum wage keeps up with inflation ensures that the amount of food on the table doesn’t get smaller.”
Many workers with incomes above but close to the minimum wage will also likely see increases as employers revise their wage schedules. “Increasing the minimum wage doesn’t just help those at the very bottom,” said Thompson, “but it boosts others on the income ladder.”
Thousands of Oregon families depend on incomes near the minimum wage. “Minimum wage employment isn’t just for teenagers earning spending money,” said Thompson. “It is for the waitress with the child at home, the fast food worker supporting his family, or the janitor who left welfare for work.”
“Oregonians have chosen not just to raise the minimum wage but to improve it, to help ensure that low-income families aren’t falling behind,” said Thompson.
The Oregon Center for Public Policy is a Silverton, Oregon-based non-profit research institute that uses research and analysis to advance policies and practices that improve the economic and social prospects of low- and moderate income Oregonians, the majority of Oregonians.