Thursday evening, January 25, a standing room only crowd filled Meeting Room 11 at the Vermont State House to both give and listen to testimony regarding the increase to the minimum wage, as proposed in bill S. 40,sponsored by 14 senators, including Michael Sirotkin, chair of the Senate Committee on Economic Development, Housing and General Affairs. For over two hours, more than 20 individuals on both sides of the issue (or caught in the middle) passionately shared their views, with the vast majority offering support for the proposal and local business owners expressing concern that any increase would force them to lay off staff or close down entirely. A few hours before the hearing, Sirotkin sat down with The Bridge to share his thoughts on the legislation:
The Bridge: Tell us about Bill S. 40
Sen. Michael Sirotkin: What we are trying to do with this, as we are trying to do in a lot of other areas in our committee with economic development, as we support businesses, try to give them a leg up, give them grants, is we are trying to get at the thorny issue of income inequality, which is a massive issue in this country and in this state. When you have the top one percent making so many multiple times the bottom 20percent, it’s not only not healthy for the economy, it’s also making it very difficult for people to have a livable wage or meet their basic needs. It’s a problem that’s growing over time; it keeps getting worse. So we keep seeing the wages and earnings of the upper five percent, one percent, 10 percent, they’re going up with the productivity of this country, whereas the wages at the bottom 10percent are stagnating. And the minimum wage itself has not kept up with inflation since 1979.
Do you think this is equally true in Vermont as in the nation?
MS: The spread in Vermont is huge; it’s greater in the rest of the country, but that’s not an excuse not to do something. The relevant question is, “Is it growing in Vermont?” and it is, even though it’s maybe not as severe as in the rest of the country. The minimum wage is one way of getting at that problem directly and narrowing the gap between the haves and the have-nots and also giving people closer to what a livable wage is. Most people agree that when you work40 hours a week, you should be able to meet your basic needs. Many conservatives object to the fact that so many people are on public assistance, so that the state has to help these people. Well, if they had more money in their wages, their benefits will go down, and that’s one of the issues we’re dealing with in this bill, the benefit cliff, we don’t want people to earn more and wind up with less money in their pockets, and we’re dealing with that in part.
So Bill S. 40 proposes raising the minimum wage to $15 per hour over four years?
MS: That’s what the bill says, but the committee hasn’t decided on the time frame. One of the things that has been frustrating in this debate is that people like myself, who are sponsors of these bills, have tried to be sensitive to what the business community says they need, which is some predictability and some gradual phase of the minimum wage, and when you go on the street and talk to people, for some reason they think we are going to turn the $10 minimum wage to$15 tomorrow. No one is talking about that. We are talking in this committee of doing it in perhaps 2020, 2022, or 2024. We haven’t decided on that yet. If we do nothing, the minimum wage won’t reach $15 until 2034.
Are you open to adjusting how this might roll out depending on what you hear in the hearing?
MS: It’s going to be very interesting. We’ve taken hours and hours of testimony, mostly taken from organizations representing business and workers, religious folks, social service agencies … Now we are going to hear from everyday citizens and everyday business owners, and yes, what we hear will make a difference on how the committee assesses in what time frame we get to $15.
How did the number 15 get chosen? Was there any number crunching to decide this is the right amount?
MS: Part of the reason we are having this discussion, to be quite honest, is because of Bernie Sanders, because he raised it on the national level. His talking about this over and over again has made people much more acutely aware of the wage stagnation and income inequality in this country to the point where he has a large number of senatorial co-sponsors on a bill to go to $15.Bernie’s bill gets to $15 in 2024. And around the country, several municipalities and states have proposed that number. When you do these types of legislation, you like to look at what other states are doing.
How do you address the concerns of businesses who fear the rise may result in them laying off workers or closing down altogether?
MS: We’ve had our economists crunch the numbers, and a very small number of jobs will be lost as a result of the increases we are talking about. In one scenario, there are90,000 Vermonters who would benefit from the minimum wage increase over four years, and over that same period of time, it was several hundred in the first year, up to a total of something like 2,800 jobs, not people, as many jobs are part-time, could be lost by2028. So in that 10 years, you may see a loss of 2,800 jobs versus the 90,000 people who would be helped. In the economist’s own words, he said, “If I look at those numbers, and I’m a low-wage earner, those are odds that I like.”