City & State: How Much Can $1.25 Change Someone's Life?

Cover Story By Laura Nahmias
City & State, June 4, 2012

Five days a week Michelle Dawkins wakes up at 2:30 a.m. and drives from her Bronx apartment to begin her shift at JFK Airport, ferrying wheelchair-bound passengers among the airport’s eight terminals. From 4:30 a.m. to 12:30 p.m., Dawkins—whom her co-workers affectionately call “Mother Love”—will make $7.25 an hour, or $58 for the day. If Dawkins, 42, doesn’t require an unpaid sick day, and if the airport needs her for 40 hours each week—which is not always a certainty during the lean fall and winter travel season—she will make $15,080 over the course of a year.

Under a new proposal currently being debated in Albany, Dawkins and the 91,000 other New Yorkers who make the federal minimum wage will see that hourly wage increase by $1.25.

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Minimum-wage jobs are the fastest-growing sector of the state’s economy, and the number of workers making $7.25 an hour jumped dramatically from 6,000 in 2008 to 91,000 by 2011.

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On a recent conference call with reporters organized in support of the wage hike, the heads of businesses like Costco, Brooklyn’s Uncommon Goods and the Greater New York Chamber of Commerce said that slightly higher wages would lead to lower employee-turnover rates and increased productivity. Higher wages for low-income workers also translated to more spending in the areas immediately surrounding workers’ homes.

Costco senior vice president Jeff Long said the company’s wages, which are higher than those of companies like Walmart, had no impact on their ability to price goods competitively.

“We have, demonstrably, the lowest prices of any retailer that we compete with, and we pay the highest wages,” Long said. “I think it’s a matter of more productive employees being better for the business in the long-term.”

Most of the state’s low-wage employees work for one of the following companies: Walmart, Yum! Brands, McDonald’s and Target. Both McDonald’s and Walmart directly lobbied state lawmakers against increasing the minimum wage.

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