OPINION – With the old wage bill of $7.25, many low paying jobs pay just the exact minimum wage or just around the minimum wage. People on this wage bracket make $14,500 per year which is below the poverty line which is now around $18,500 per year.
About two thirds of people going for the low paying jobs are women and four women out of 10 are African Americans. The minimum wage $10.10 which congress has called for was being backed by President Obama and if enacted as a law, it will see a boost of the more than 20 million low income earners and help to reduce the increasing wage gap.
As most of these workers are women especially the African Americans, this will help to reduce the number of women in poverty and also the general U.S. poverty levels. This would have a collective effect of the economy boost as women will be able to have some savings that will eventually lead to increased investment which is a key determinant of economic growth.
It has been found that, most women in the low wage bracket do most of the odd jobs such as looking after elderly people, baby-sitting, tipped jobs or just being general house helps. This has greatly contributed incidences of women in poverty who have low living standards. This is sometimes passed to their children as most of them are single. This results to a vicious cycle of poverty given the ever increasing daily needs and low incomes.
More than 7 percent of the 2.8 million workers who will get the possible wage rise are parents. As women are included in this portion, the increase will lead to a fairer income distribution and bring about equality as the wage gap narrows. In a 2012 report, it was found that for every dollar received by men, women only got 77 cents which is causes a great disparity between the aggregate incomes of the two.
The minimum wage rise from $7.25 to $10.10 will reduce the overall poverty levels and with a special effect to the women who represent the biggest number of those who are to benefit from the rise. It will also help reduce racial imbalance as a large portion of these women are not of American origin. This will help to boost the economic growth significantly in the long run.
By Anita Johnson
Founder of Money Wisdom for Women