Gov. Kate Brown signed Oregon’s new minimum wage into law on Wednesday, March 2, making Oregon the first state in the country to put in place a tiered system that makes the minimum wage different for rural vs. urban areas. The new law also gives Oregon the highest minimum wage in the country.
The new law ratchets up the minimum wage from its current $9.25 per hour to $14.75 per hour within the Portland urban growth boundary by 2022; to $13.50 in smaller cities by 2022, and to $12.50 in rural areas by 2022.
The Archdiocese of Portland in Oregon released a statement several months ago regarding the debate over raising the minimum wage: “The Church has long held that a living wage is a fundamental right of workers and a moral imperative of employers because it provides workers with the means and resources to form and support a family,” the statement read. “A just wage helps promote family stability, especially by providing greater economic security to workers and their families. A just wage should help ensure that full time workers and their families do not live in poverty.”
The archdiocese referred to the catechism’s teaching on just wages, and concluded by stating, “While we are not in a position to judge whether or not the final details provide a living wage or are just for both workers and employers, we trust the process where the deliberations of our elected representatives were thoughtful and debated.”
State Rep. Rob Nosse (D-Portland) says he believes that’s exactly what happened. “The governor and the Senate carefully threaded the needle to help both low-wage workers and also help employers anticipate the wage increases and plan for them. I feel very lucky to be a part of this.”
Rep. Nosse, a parishioner at St. Philip Neri in Portland, says, “Absolutely my faith informs how I voted on this and how I think about it.”
Jeanne Haster executive director, Jesuit Volunteer Corps Northwest, thought the legislation could have gone farther, but she appreciates the compromises made in order to pass the bill. “It’s a practical approach,” she says.
Passing the measure was difficult. Lobbyists for business groups were against a minimum wage hike, whereas labor groups threatened to mount an expensive ballot measure if the state legislature didn’t act.
Haster says that Jesuit Volunteer Corps Northwest sets their employees’ salaries according to Portland’s estimated living wage, which was pegged at $13.56 an hour in summer 2015. “We try to pay a living wage rather than a minimum wage because Portland has become such a difficult city to afford to live in,” she says. “I don’t know how people who make minimum wage live. I think we need to be paying people so they can escape living in poverty.”
Dr. Eric Fruits, a University of Portland economics professor who is also a former chair of the Multnomah County Republican Party, came to a different conclusion after analyzing the effects of a minimum wage hike. He observes that no one forces people to take jobs that pay so little that workers live in poverty. “There’s a personal liberty issue,” he says. “I’m always confused when I hear that earning zero is better than earning $8 an hour.”
Fruits’ January report on the effects of raising the minimum wage, “Impacts of Increasing Oregon’s Minimum Wage,” found that increasing the minimum wage to $13.50 would result in the loss of around 55,000 jobs.
“The assertion that Portland has a higher cost of living than the rest of the state turns a blind eye to the differences in the cost of living within the City of Portland,” the report states. Fruits found that rents in the high-poverty areas on Portland’s outer east side are less than half of what they are in other parts of the city.
“Another thing that gets missed is that since 1990 we have a huge number of students who are unemployed,” he says. “I find that not very compassionate.”
Fruits suggests that an 18-year-old kid who asks an employer if he can do odd jobs for $5 an hour should be allowed to do that.
Rep. Nosse points to another report, “The High Cost of Low Wages in Oregon,” written by the University of Oregon Labor Education and Research Center. That report found that, “Women are more likely than men to end up in low-wage jobs. They are also more likely to be single parents trying to support a family. Low wages and irregular, part-time hours make their lives even more difficult.”
The Economic Policy Institute in Washington, D.C., found that a third of workers affected by raising the minimum wage are at least 40 years old. The average person helped is 35 years old; 56 percent are women; 28 percent have children; 55 percent work fulltime. On average they earn half of their family’s income.
Rep. Nosse credits his Republican peers with also wanting to help hard-working Oregonians, but via a different strategy — mostly by luring more good-paying jobs to the state. “But the internet and manufacturing have changed the face of the U.S. economy,” he says. “The service sector is where job growth is. We’re not a timber state anymore.”
Nearly half the states — mostly in the South and Midwest — follow the federal minimum wage of $7.25 per hour.
Oregon’s current minimum wage is $9.25 an hour, tenth highest in the country. The highest is the District of Columbia, at $10.50, with Massachusetts and California at $10. Alaska, Vermont, Rhode Island, Connecticut and Washington round out the rest of the top ten.