ROCHESTER, Minn. - President Joe Biden is issuing an executive order to raise the minimum wage for federal workers to $15 an hour. So what would that mean for the Med City?
The President is starting with federal contractors, but he wants to eventually raise the minimum wage for everyone. The federal minimum wage is currently $7.25 an hour and it's been that way since 2009. In 2019, almost 400,000 American workers were making that and another 1.2 million made even less, that's according to the U.S. Department of Labor. So raising the national minimum wage to $15 an hour would lift 1.3 million workers above wages that put them below the poverty line. Minnesota currently has a minimum wage of $10.08 for large employers and $8.21 an hour for small employers. Iowa's minimum wage matches the current federal minimum wage at $7.25.
Rochester Mayor Kim Norton said it's time the federal government steps up and does something, but she also has reservations about raising the number by that much. "Doubling wages will double the amount of money that a small business has to pay and if they can't make ends meet now, what does that mean? It means they close their doors, it means they lay employees off and we don't need that either," she explained. "So hopefully some really good thinking will go into this."
Mayor Norton said if the federal minimum wage is raised to $15 an hour, the lower wage businesses will have to be able to pay their employees some how. So that means some things could become more expensive for the public down the road. During the pandemic when so many small businesses are struggling to stay open, putting the pressure on a wage increase will be tough. "I have some concern about our smaller businesses who are struggling right now and hanging on by a thread what a change would look like to them," explained Mayor Norton. "So I think if something is going to be done, whatever is going to be done, should be done very carefully with a real eye toward not negatively effecting our really small businesses who are already struggling."
CBS News is learning that Democrats in the House are expected in the coming weeks to reintroduce a version of the Raise the Wage Act that passed in the chamber two years ago, but never gained traction in the Republican-controlled Senate.