Wednesday, February 24, 2016

Low wages cost Florida taxpayers $11.4 billion yearly, SEIU study says

Posted By on Wed, Feb 24, 2016 at 9:46 AM

  • Photo by Monivette Cordeiro
Florida's minimum wage of $8.05 isn't just impacting workers who have to stretch every penny — it's also affecting Florida taxpayers, to the tune of $11.4 billion in public assistance every year, according to a Service Employees International Union (SEIU) report

A recent study, done by Florida State University professor Patrick Mason and commissioned by SEIU, shows the average low-wage worker in the state is a 40-year-old woman who works 32 hours a week, has one year of higher education and earns $14,190 annually. Floridians receive $35 billion in public assistance, with low-wage workers and their families getting about $11.4 billion. 

"Low-wage individuals and families must supplement their low and unstable earnings by utilizing a large variety of public assistance programs," Mason writes. "Although this public assistance is vital for the wellbeing of low-wage workers, it also subsidizes corporate profitability. If employers paid higher
wages, offered more stable employment, and provided greater benefits, public assistance programs would have lower costs." 

In an interview, Mason adds it should be noted that more than half of low-wage workers are at Florida firms that employ at least 100 employees. Of that fraction, about 35 percent work at firms with 1,000 employees. 

"These are median to very large firms paying low wages," he says. "These are not mom-and-pop shops that are struggling." 

The study also found that close to 39 percent of Florida’s workforce is made up of low-wage workers, and more than half work in "secretarial work, retail sales, restaurant services, housekeeping, and drivers and operators." 

"The takeaway is that we have a large proportion of workers in this state who are working, on average, 42 weeks a year, 32 hours a week, but their earnings from these jobs are too low to provide a decent standard of living," Mason says. "Firms are using their economic power to hire workers for as low a wage as possible, so they have to apply for public assistance to help them maintain a standard of living. If the minimum wage was increased, it would reduce some of this money."

While the study doesn't outline what that increase in minimum wage would look like, Monica Russo, president of SEIU Florida, says in a teleconference that the organization believes the increase should be to $15 an hour. 

"We've created a corporate welfare state," she says. "From our perspective, workers would have more money in their pockets to pay for basics, invest in their families, communities."

You can read the rest of the study here.

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