The Lead

A state House hearing for Pa.’s budget watchdog turned into a minimum wage Q&A

By: - February 11, 2019 1:19 pm

(Capital-Star photo).

A budget hearing Monday for Pennsylvania’s independent fiscal watchdog agency turned into a proxy fight over Gov. Tom Wolf’s plan to boost Pennsylvania’s minimum wage.

Lawmakers on the House Appropriations Committee used a Monday appearance by the state’s Independent Fiscal Office to crack the hood on Wolf’s plan to increase the wage from the current $7.25 an hour, where it’s been mired since 2009, to $12 an hour, and eventually to $15.

The wage, which is currently the same as the federal minimum, is lower than all of Pennsylvania’s neighboring states.

The IFO most recently kicked the tires on a wage increase in April 2018, concluding that a hike to $12 an hour would raise wages for more than 1 million workers, the Pa. Post reported. But it would also result in 33,000 fewer job opportunities, the analysis found.

Speaking to lawmakers Monday, the budget watchdog office’s director, Matthew Knittel, said that job losses could increase with Wolf’s tighter timeline for a wage increase.

On Monday, committee Democrats kept the focus on the positive, highlighting the increased tax revenue and income gains for workers that they said a higher wage would bring. Republicans focused on the potential for job losses and shuttered businesses in their home districts..

“State’s as red as Arkansas” have raised the minimum wage, Rep. Matt Bradford, of Montgomery County, the committee’s ranking Democrat, pointed out. He painted the lack of an increase as both a moral and political problem.

Appropriations Chairman Stan Saylor, R-York, said supporting the generational shift from Baby Boomers to millennials. He portrayed  would require more than minimum wage jobs, and that staying in minimum you’re not being aggressive enough in getting those job training dollars and moving forward.”

A 2018 report from the state Department of Labor and Industry found that 56 percent of current minimum wage earners were under the age of 25, 93 percent had no kids, and 59 percent had a high school degree or less.

Knittel’s office has also estimated 80 percent of the income increase would come from higher prices, while 20 percent would come from reduced profits, and projected $40 million in new tax revenue from income and sales taxes on workers with increased wages.

A new report from the fiscal office will be released in late March.

Editor’s note: This story was updated with a newer state minimum wage report.

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Stephen Caruso
Stephen Caruso

Stephen Caruso is a former senior reporter with Pennsylvania Capital-Star. Before working with the Capital-Star he covered Pennsylvania state government for The PLS Reporter.