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Frequently Asked Questions
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 Don’t most people on minimum wage move on to higher-paying jobs?-
No. The Albuquerque study showed that workers in Albuquerque earning less than $7.50/hour had been in the work force for many years already (an average of 12.8 years) and were still earning less than $7.50. (Dr. Robert Pollin, Political Economy Research Institute)
- How much earning power has the minimum wage lost?
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If the wage had kept pace with the cost of living since 1968, the minimum wage today would be $8.82.
- What kind of impact will this increase have on bread winners?
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An increase to $7.50 for those currently working at $5.15 per hour will put an additional $100 per week ($5,000 per year) into the pockets of 123,000 working New Mexicans currently earning the federal minimum wage. $100 each week pays for two tanks of gas to get to work and a bag of groceries.
- Will a higher minimum wage hurt families by making them ineligible for public assistance?
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After Santa Fe increased its minimum wage, the demand for cash assistance from welfare offices decreased by 10%. Nevertheless, $7.50 will not make workers wealthy, and most will still qualify for assistance. A family of 2 to 5 members with a single worker, earning $7.50, will qualify for Medicaid, food stamps, and child care. A family of four with two $7.50 earners, however, would only qualify for Medicaid. The $7.50 minimum wage would reward work and reduce dependence on welfare, but it would not eliminate the social safety net for those families who may still fall victim to the dangers of poverty.
- Will an increase in the minimum wage lead to job loss?
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No, a 1998 study of the last increase in the federal minimum wage documented no significant job loss associated with the 1996-97 minimum wage increase. Recent studies suggest that employers are able to offset the cost of wage increases with higher worker productivity, less worker turnover, or insignificant increases in prices. (The Economic Policy Institute)
In Santa Fe, a year after the $8.50 minimum wage took effect, the city had added 1,400 new jobs, growing at a rate equal to the rest of the state. The retail, hotel, and restaurant sector grew at an even faster rate than the rest of the state and the other private employment sectors in Santa Fe, adding 300 jobs. (New Mexico Department of Labor)
- But will the increase result in job-flight from New Mexico?
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On the contrary, states with higher minimum wages saw 50% greater job growth from 1997 to 2004 than states that stayed at the federal minimum. (Fiscal Policy Institute)
- What types of people are low-wage workers?
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A study of Albuquerque low-wage workers showed that 61.5% of the workers making less than $7.50 are women. (Dr. Robert Pollin, Political Economy Research Institute) A national study of the workforce showed that 13.4% of the total workforce is Hispanic, but Hispanics are 19.7% of workers affected by an increase. Similarly African Americans represent 11.1% of the total workforce, but are 15.3% of workers affected by an increase. (The Economic Policy Institute).
- Aren’t most of these workers teenagers or part-time employees?
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No, the vast majority – 80% – of New Mexicans who will benefit from an increase to $7.50 are adults who work full time. (New Mexico Voices for Children) Close to half (43.9%) of workers who would benefit from a minimum wage increase work full time and another third (34.5%) work between 20 and 34 hours per week. (Economic Policy Institute)
- Who would benefit from a minimum wage increase?
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In 2005, 123,000 New Mexicans work at an hourly wage between $5.15. (the federal minimum wage) and $7.50 (The Economic Policy Institute).
Expert: Economic Policy Institute
Question asked by: Concerned worker
- Will an increase in the minimum wage fuel price inflation?
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No minimum wage increase since 1930 has fueled price increases. Several studies on the impact of local minimum wage ordinances document no significant increases in prices following the wage increases. (Political Economy Research Institute, and the Institute for Industrial Relations at the University of California at Berkley)
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