Stephen Segal: Take it from a millionaire, a $15 minimum wage is good for Pa. businesses

Lawmakers in the House of Representatives voted to approve the American Rescue Plan, a major step toward providing Americans the relief they desperately need and deserve. As President Biden’s relief package moves to the Senate floor, tense negotiations still are taking place on key provisions included in the plan. Despite not costing the government a dime, one of the most effective pieces of economic stimulus in the package has proven to also be the most contentious: raising the minimum wage.

The Biden plan pulls directly from the Raise the Wage Act, which seeks to raise the federal minimum wage to $15 an hour by 2025 and eliminate the subminimum wage for tipped workers. This would more than double the current federal minimum wage of just $7.25 an hour, and while this is a bold change, it’s a much needed one, particularly for workers and businesses here in my home state of Pennsylvania.

The minimum wages in New York, New Jersey and Maryland are all set to gradually increase to $15 an hour in coming years. Meanwhile, Pennsylvania’s minimum wage is stuck at $7.25. This shameful state of affairs will soon leave tens of thousands of Pennsylvania workers earning less than half of what their counterparts in neighboring states will earn for the exact same jobs. This not only hurts workers — it leaves the state’s business community at a significant disadvantage as well.

It’s simple economics. Businesses need customers with money in their pockets, and too many working people in this country earn too little to be reliable customers. Forty percent of Americans report not being able to afford a $400 emergency expense. Unsurprisingly, about 40% of Americans also make less than $15 an hour. How much do you think those people are contributing to an economy that is 70% consumer demand-based?

The reason the covid crisis has hurt so many businesses isn’t that they have to pay their workers more — it’s because they’re losing customers. By raising the minimum wage, we may be slightly increasing some business expenses, but we’d be massively increasing the pool of potential customers with money to spend. Take it from a retired small-business owner: That’s good news for the business community.

We’ve seen the results in states that already have raised their minimum wages; even in rural areas where the cost of living is lower, many companies end up doing better than ever instead of being forced to shut down or cut staff. The math makes this a win-win for businesses and workers alike.

Unfortunately, the prospects for raising the minimum wage on a state level aren’t very promising. That’s why the Biden proposal to include this provision in the next round of coronavirus relief is a big deal for Pennsylvania — it’s likely our only chance to avoid another decade of $7.25. And that’s why every legislator that we send to Washington, whether Democrat or Republican, should be fighting in support of this change.

At a time when our country feels more divided than ever, the minimum wage gives politicians from both sides of the aisle a way to find something to agree on and prove that partisan bickering won’t stop them from doing what’s right for their constituents.

While this is typically considered a Democratic issue, it really shouldn’t be. Voters from every side of the political divide support raising the minimum wage, including a sizable number of Republicans. In fact, 61% of Floridians voted to increase their minimum wage to $15 an hour in the same election cycle where Donald Trump won the state. Over the last 10 years, voters in other red states like Arkansas, Alaska, Missouri, and South Dakota have all voted in favor of minimum wage increases when given the chance to weigh in directly through ballot measures.

If Republican voters can agree with Democrats on this issue, there’s no reason senators in Congress can’t do the same. If there’s one thing that the Republican and Democratic politicians we send to Washington should be able to find common ground on, it’s that hard-working Pennsylvanians deserve to be paid a fair wage.

Stephen Segal, a retired small-business owner in Philadelphia, is a member of The Patriotic Millionaires and past president of the Treatment Advocacy Center of Arlington, Va.