Minimum Wage Proponents Up the Ante, Now Seeking $10.10 Per Hour Proposal

February 18, 2014

The Raise Michigan Campaign, a coalition with close ties to labor unions and the Michigan Democratic Party, has decided to follow President Obama's call for a $10.10 minimum wage, after previously announcing it would pursue a petition drive to place a $9.50 per hour wage on the 2014 ballot.

If the revised petition language is approved by the voters or Legislature, the minimum wage would increase to $8.10 per hour in January of 2015, $9.10 per hour in July of 2016, $10.10 per hour in January of 2017 and tie future increases to the rate of inflation. The proposal would hike wages for tipped employees to allow them take home wages of the minimum wage amount plus tips, thereby greatly inflating their wages well above those of other minimum wage workers. More information is available in chart form here. 

State law allows citizens or groups to initiate legislation through a petition drive by collecting signatures from enough voters to match eight percent of those who participate in the last gubernatorial election, or 258,088. Upon certification of those signatures, the measure is sent to the Legislature. If lawmakers approve the measure within 40 days, it becomes law. If not, it goes before voters in the next statewide election. Lawmakers also can come up with their own alternative which would go before voters along with the original petition proposal.

The Michigan Chamber is concerned about the damaging economic realities of the proposal. If Michigan increases the cost of employing entry-level workers, lower-skilled workers will see less job opportunities because employers will be forced to hire higher-skilled job applicants to fill multiple roles or cut jobs to absorb the costs associated with the increase. Furthermore, we are concerned about the upward pressure this proposal will place on other wages in the labor market. Any increase in the minimum wage has a spillover effect on workers who currently earn just above the minimum wage.

Currently, Michigan is one of 21 states that has a minimum wage rate higher than the federal minimum wage. Michigan job providers are doing their best to provide the highest wage possible to their workers because they know it is the best way to attract and retain a quality workforce. Given that Michigan currently has an 8.4 percent unemployment rate, we believe government and voters should be focused on policies to help workers get jobs, not actively increasing the cost of hiring workers and creating barriers to entry.

If you’d like further information or to get involved in this issue, please visit the Michigan Chamber Briefing Center or contact Wendy Block, Director of Health Policy & Human Resources, at (517) 371-7678