Policy Matters Ohio (PMO) released a report Tuesday on the potential benefits of raising the minimum wage to $15 an hour, with researcher Michael Shields saying it would add $6.1 billion into the state economy each year, benefit 1.56 million Ohioans and drive greater pay equity for women and minorities.

The report modeled the effects of raising the state minimum wage to $15 an hour by 2026 and eliminating the subminimum wage for tipped workers, a schedule based on a Florida law approved by its voters in November. Shields said a similar approach would likely be needed in Ohio given the Republican control of the Statehouse, noting that led to the 2006 increase in Ohio minimum wage.

The increase would ensure all Ohioans share in the prosperity created by their work, he said, and the current minimum wage of $8.80 an hour is 28 percent less than the inflation-adjusted $12 it was worth in 1968. He also discussed how the increase would benefit people of color and women who are paid less, saying that it would increase the pay for 36 percent of working women in the state.

Overall, the increase would generate $4.9 billion more in annual wages with another $1.2 billion from eliminating the tipped credit, and much of that would be spent on necessities in local businesses. The average affected worker would receive an additional $3,900 each year, Shields added, and it would increase wages for 406,000 working parents.

He also said that the pandemic highlighted how much the public relies on low-paid workers in grocery stores, health care and child care and that paying a living wage is part of valuing that work. Holly Sklar, CEO of Business for a Fair Minimum Wage, discussed how the increase would help companies as well.

“The minimum wage has become a poverty wage instead of an anti-poverty wage and that is bad for business as well as workers,” she said. “Workers are also customers. Most businesses have many more customers than employees. Local businesses depend on local customers to make enough to buy what they are selling.”

Sklar also noted that the minimum wage was instituted due to the Great Depression to help both workers and businesses, but said this is the longest period in history without a national increase, making it a “poverty wage” rather than an anti-poverty measure. The Ohio living wage is around $13.16 for one adult without children, Sklar added, according to an MIT calculation using pre-pandemic data.

A minimum wage must be enough to live on during the COVID-19 recovery, she continued, discussing how workers are also customers and that boosting pay also helps fuel the economy, reduce turnover and improve customer service. Low minimum wages also make it more difficult for small businesses, she said, as large corporations have raised their wages to around $15 an hour.

Shields also said the minimum wage increase would be “one of the most effective ways” to drive the post-pandemic recovery as it would direct money to those who would “go out and spend it.” He also said he was not as knowledgeable on the topic of universal basic income but praised the stimulus payments.

Sklar said that there is support for raising the wage among business leaders, but others “get stuck in their ways” and that there is a need to continue pushing for an increase.

PMO’s virtual press conference also featured members of Service Employees International Union (SEIU) Local 1 in Columbus and Cleveland, including security guard Louis Hernandez and janitors Mary Shackelford and Tina Callahan. They discussed financial difficulties, safety concerns due to the hours they work and how the pandemic led them to be labeled essential workers despite what they are paid.

The report is available at www.hannah.com>Important New Documents>Library.