By Chris Lu
Time, July 24, 2017
Lu served as the U.S. Deputy Secretary of Labor during the Obama Administration
It’s been eight years since the federal minimum wage was last raised on July 24, 2009. ... millions of people continue to work for the federal minimum of $7.25 an hour — without a pay raise in sight. ...
As the Deputy Secretary of Labor, I saw not only how higher wages lifted up the lives of working-class Americans but also how employers thrived when they paid higher wages.
One of those employers is &pizza, which opened in 2012 and now has 22 locations spread across four states and D.C. The company’s rapid growth is built on much more than great tasting food (although the pizza is delicious). Michael Lastoria, the CEO of &pizza, understands that the company’s most valuable asset is its employees, so he pays a starting wage higher than the minimum wage. At the company’s Virginia locations, for example, new employees earn $10.50 an hour, instead of the state minimum of $7.25.
Lastoria explained his rationale to me last year: “It’s a simple, but critical, concept: take care of your people and they will take care of your customers.” For &pizza, higher wages reduce employee turnover, increase productivity and improve customer service.
All of this has been confirmed by U.S. employers, both large and small. In a 2016 survey conducted by a Republican polling firm, 80% of business executives across the country supported raising their state's minimum wage.
That’s why businesses — from small and medium-sized operations to major corporations like Ikea, Costco, Facebook and Amalgamated Bank — have taken steps to raise their wages well above the required minimum level. And business owners like Michael Lastoria have joined with groups like Business for a Fair Minimum Wage to advocate for higher federal and state wage floors.
In addition to a more productive workforce, savvy business owners know that their employees, as well as the employees of other businesses, are also potential customers. When low-wage workers get a pay raise, they don’t invest the extra money with financial advisors. They spend it, and that leads to greater consumer demand for goods and services — like pizza. ...
Employers like &pizza are doing their part in creating shared prosperity, as are the many states that have passed higher wage laws in recent years. But they can’t do it alone. There’s no excuse for congressional inaction on the minimum wage. After eight long years of waiting, American workers deserve a raise.
Copyright 2017 Chris Lu and Time Inc.
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