$22 Minimum Wage? Study Shows Huge Discrepancy Between Minimum Wage and Productivity

A $22 minimum wage would be in place if it had kept up with increased rates in worker productivity, Sen. Elizabeth Warren (D-Mass.) has claimed, citing a recent study.

Expand | Collapse
(Photo: YouTube/T. Becket Adams Screen Shot)Elizabeth Warren argued that the minimum wage would currently stand at an hour if it had remained in line with the increase of productivity over recent decades.

Warren made the claim as she made the case for increasing the minimum wage last week during a Senate Committee on Health, Education, Labor and Pensions hearing.

The senator said, "If we started in 1960 and we said that as productivity goes up, that is as workers are producing more, then the minimum wage is going to go up the same. And if that were the case then the minimum wage today would be about $22 an hour."

She was speaking to Dr. Arindrajit Dube, a University of Massachusetts Amherst professor who has studied the economic impacts of minimum wage. She added, "So my question is Mr. Dube, with a minimum wage of $7.25 an hour, what happened to the other $14.75? It sure didn't go to the worker."

Dube further claimed that if the minimum wage had grown over that same period at the same pace as it had for the top 1 percent of income earners, then the minimum wage would in fact be closer to $33 an hour.

Warren took the opportunity to highlight the recent study, which claims to show flat minimum wage growth over the past 40-plus years. The study claims that this flat growth coincided coinciding with surging inequality across a number of economic indicators, according to The Huffington Post.

The senator does not actually want to raise the minimum wage to $22 an hour nor $33 an hour, but did argue for the federal minimum wage to rise to more than $10 an hour in stepped increases over the coming few years.

Here is a video report of Senator Warren's address: