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Advocacy Group Calls for Increase in Federal Minimum Wage

Photo by KUT News
A labor advocacy group claims an increased minimum wage would put more money into the economy. The National Federation of Independent Business disagrees.

Earlier this week,  The National Employment Law Project (NELP),  a non-profit organization that advocates for stronger labor standards, issued a call for an increase in the federal minimum wage. They argue an increase  would boost consumer demand and promote hiring.

According to Anne Thompson, a policy analyst with the NELP, "Roughly 334,000 Texans depend on the minimum wage, yet the real value of the minimum wage has fallen 5 percent since the last... increase in 2009." That, she said, means about $800 less in purchasing power for minimum wage Texans.

According to the Bureau of Labor Statistics, 14.7 percent of minimum wage earners work in Texas.

NELP cites a study from the Economic Policy Institute, a think-tank focusing on low- and middle-income Americans, which claims that raising the minimum wage to $9.50 an hour would create more than $60 billion in consumer spending.

But Will Newton, Executive Director of the Texas Office of the National Federation of Independent Business, a non-profit association representing small and independent businesses, told KUT News a higher minimum wage would have the opposite effect.

"What you're doing [by raising the minimum wage] is not putting more money--necessarily--into the economy by taking it out of the pockets of the business owners or the shareholders. You're actually shutting off jobs. Well the one thing we need here in Texas and across the U.S. is jobs," Newton said.

Instead of increasing the minimum wage, Newton argues, "What you need to do is get the government out of the employee-employer relationship, totally. And I say that because business owners will tell you, to a person, that the government is the greatest impediment to hiring and keeping workers right now.