Big Business, Corporate Profits, and the Minimum Wage
America’s low-wage economy is marked by two extremes.
On the one hand, workers earning at or near the minimum wage are
seeing the real value of their paychecks diminish steadily
over time, as the cost of living
increases while their wages remain stagnant.
After nearly half a century of neglect, today’s federal minimum
wage of $7.25 per hour is decades out of date.
In terms of purchasing power, its value is 30 percent lower
today than it was in 1968.....
The central finding of this report is that
the majority of America’s lowest-paid workers are employed
by large corporations, not small businesses, and that most of the largest
low-wage employers have recovered
from the recession and are in a strong financial position.
The majority (66 percent)
of low-wage workers are not employed by small businesses, but rather
by large corporations with over 100 employees;
The 50 largest employers of low-wage workers have largely
recovered from the recession and most are
in strong financial positions: 92 percent
were profitable last year; 78 percent have been profitable for the
last three years; 75 percent have higher revenues now than before the
recession; 73 percent have
higher cash holdings; and 63 percent have higher operating margins (a
measure of profitability).
Top executive compensation averaged $9.4 million last year at
hese firms, and they have returned
$174.8 billion to shareholders in dividends or share buybacks over the
past five years.
Three years after the official end of the Great Recession, the U.S.
continues to face a dual-
crisis of stagnant wages and sluggish job growth.
Critics argue that a higher minimum wage will discourage companies from
and that most low-wage employers are small businesses that are still
struggling in a weak economy. In
fact, this report demonstrates that the majority of low-wage workers
are employed by large
corporations, most of which are enjoying strong profits.
National Jobs for All Coalition