Push back on minimum wage study by County Featured

MoCo LogoLast week’s release of a Montgomery County-commissioned study if the County increased the minimum wage to $15 per hour was a devastating blow to its proponents.

The results of the study, conducted by Philadelphia-based PFM Consulting group, are a dark prediction for minimum wage increase advocates, projecting the County would lose 47,000 jobs and $396.5 million in aggregate by 2022. The study also concludes that the County’s current minimum wage of $11.50 per hour is too high and the ideal minimum wage for the County would be $11 per hour.

Despite the sharp public relations blow the study dealt to their plan for a minimum wage increase, the members of the County Council that voted in favor of it have no intentions of backing down. However, even with the anticipated public rebuke of the study when its authors speak to the Council on Sept. 19, finding a way to increase the minimum wage will be a daunting task.Advocates on the Council for the minimum wage increase have attacked the study’s methodology saying it was conducted to reflect the sentiments of business owners surveys, saying the study were biased in favor of the feelings of business owners, not economic science.

“To me it’s just a total bogus study,” said Council member Marc Elrich (D-at large), the lead sponsor of the bill to increase the minimum wage.

County Executive Ike Leggett, who vetoed a previous minimum wage increase bill, said even if the results of the study are partially off, it is still a serious warning for the County.

“The numbers are so staggering that if you were to still cut it in half, you still have a pretty substantial number,” Leggett said of the results of the study.

The study was conducted by collecting data from electronic surveys that PFM consulting sent to County businesses and non-profits, as well as data from the budget, contracts with outside vendors, economic and demographic data, and interviews with County business and community leaders and officials.

Of the study’s methodology, the one that received the most criticism was the two electronic surveys PFM Consulting sent throughout the County, one to businesses and one to non-profits. The surveys asked employers about the size of their business and the types of employees they hire.

“It was not possible to do a projection of the impact of raising the minimum wage with any scientific validity,” said Council member Hans Riemer (D-at large) and a supporter of increasing the minimum wage to $15 per hour.

Even before its release, minimum wage increase advocate were critical of the idea for a study. While back in January, the Council voted 5-4 to increase the minimum wage, the four dissenting council members – Roger Berliner (D-1), Craig Rice (D-2), Sidney Katz (D-3) and Nancy Floreen (D-at large) said they needed to see a Montgomery County study on the minimum wage before they could be convinced they could vote for it. The five in favor rebuffed them, and only changed their minds after Leggett vetoed the bill, echoing a need for a study.

The newly-released study creates a difficult political hurdle for advocates that have fought so hard for an increase in the minimum wage. Council members have locked arms with grassroots political organization such as Progressive Maryland and CASA to pressure Leggett and others on the Council to change their minds.

In January, advocates from Progressive Maryland interrupted one of Leggett’s budget forums in Silver Spring with bullhorn chants demanding the County raise the minimum wage. Leggett responded that the County could not afford to increase the minimum wage just yet, saying the County could not afford it in the current budget, as it would require mandated wage increases for the County’s non-profit partners. However, Leggett conceded that the County will eventually “do it” and increase the minimum wage to $15 per hour.

For most on the County government increasing the County current minimum wage of $11.50 per hour is not a matter of ‘if’ but ‘when.’

Leventhal, who chairs the County Council Health and Human Services Committee, said he has not talked with his colleagues about the issue, citing open meeting laws, but hopes there can be some sort of compromise when the Council reconvenes in September.

“I don't think it’s reasonable to stay at $11.50 in 2017 and never increase it again,” said Council member George Leventhal, a co-sponsor of the latest bill to increase the minimum wage. “I do not see how that is reasonable.”



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