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Minimum Wage Hike Passes Connecticut House

Connecticut’s minimum wage could rise a quarter a year for the next two years to $8.75. A new study says that minimum wage increases do little to effectively help poor people.

The Connecticut House of Representatives approved raising the minimum wage from $8.25 to $8.75 in the next two years. The vote passed by an 88-62 margin and the bill’s fate is now up to the Senate.

According to the Hartford Courant, the proposal was pushed by House Speaker – and U.S. Congress candidate - Chris Donovan. He reportedly backed a more aggressive bill, which would have raised minimum wage to $9.75 in two years and then tied future increases to inflation.

Economists and politicians have never reached a consensus on the merits of raising the minimum wage and the potential effects on employment numbers. A new study from the University of Georgia states that raising the minimum wage doesn’t help poor people.

From the study’s executive summary:      

As one explanation of their findings, the authors show that over half (54.7 percent) of poor, less-educated individuals between ages 16 and 64 do not work. A similar percentage (53.6 percent) of individuals who report missing a rent or a mortgage payment do not work. Thus, many of the people policymakers are trying to help won’t benefit because they’re not working.

Even among those who do work, the minimum wage appears to be poorly targeted. Nearly 87 percent of the wage earners who benefited from the 40 percent increase in the federal minimum wage between 2007 and 2009 were not poor—56 percent lived in households with an income more than two times the poverty threshold, and one-third lived in households with an income more than three times the poverty level.

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