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Despite a stagnant minimum wage in Pa., a tight labor market is forcing employee wages up

A low minimum wage might not make much difference for workers. Amid a tight labor market, employers are raising their wages on their own.

LANCASTER, Pa. — Gov. Tom Wolf is calling on lawmakers to raise the state’s minimum wage, which has been sitting at $7.25 an hour for more than a decade. The federal government last increased the minimum wage in 2009. 

Opposition from state Republicans has gridlocked proposed legislation to raise the minimum wage to $12 an hour with a pathway to $15 an hour, even as 26 U.S. states plan to raise their minimum wage in the new year.

Raising the minimum wage is supported by 67 percent of registered voters, according to a Franklin and Marshall College poll.

“They definitely should raise it because other places have raised it and just they need more money, for sure,” said Lidia D. of South Carolina.

“Definitely the minimum wage should be higher,” said Christine Stewart of Lancaster. “We need to be basing it off of living wage standards as opposed to a federal number that was created long ago and really is not keeping up with the cost of living.”

However, minimum wage might not even make that much of a difference for workers. Amid a tight labor market, employers are raising wages on their own.

In recent months, Rutter’s increased its starting wage to $14 an hour, Amazon to $18 an hour and Acme warehouse to $20.30 an hour.

“[Minimum wage] hasn't even come up in conversation lately,” said Tyrone Miller, CEO of staffing agency Lancaster Works. “It is an employer's nightmare right now because there's a wage war going on where minimum wage is not even in the discussion anymore. Employees are demanding $17, $18, $20 an hour for entry-level, factory, packing, distribution-type opportunities.”

Wage hikes are benefitting larger companies over small businesses that can’t afford to spend more on payroll.

“I really feel bad for the small business owners. They will feel the pinch if this continues,” Miller said.

Whether employees will see much benefit from the larger paychecks remains unclear. While wages appeared to have grown 4.2 percent in 2021, according to the Bureau of Labor Statistics, real wages actually fell 1.9 percent due to high inflation.


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