Pennsylvania raises minimum wage in state government

Pennsylvania Governor Tom Wolf signed Executive Order 2016-2 on March 7 that increases the minimum wage for employees under the governor’s jurisdiction to $10.15 per hour, effective immediately, and also provides for annual increases based on inflation beginning in January of 2017. The Executive Order also covers employees of organizations that negotiate state contracts or that lease property to the government. Those employees that perform direct services to the commonwealth or spend at least 20 percent of their working time on ancillary services related to the contract or lease will be paid a minimum of $10.15 an hour. This provision will take effect when contracts or leases are solicited or bilaterally modified on or after July 1, 2016. If the legislature acts to expand the raise to the entire state, revenue would be boosted by roughly $60 million annually, providing additional resources to fund critical programs across the commonwealth. The Executive Order is part of the governor’s “Jobs That Pay” initiative.

The inflation-adjusted hourly earnings of the bottom fifth of Pennsylvania workers are lower today than they were in 1979. The current minimum wage of $7.25 per hour has 18 percent less purchasing power than the minimum wage had in 1979. A full-time, year-round worker earning the current minimum wage earns less than the federal poverty threshold for a family of two. Studies have consistently shown that increases in the minimum wage have not reduced the employment of low-wage workers.

In addition to signing the executive order, Governor Tom Wolf also called upon legislators to pass a minimum wage increase for all Pennsylvania workers, stating that an increase to $10.15 per hour “supports local businesses, creates new jobs, and would boost state revenue by roughly $60 million annually.” Such an increase would benefit more than 1.2 million workers in Pennsylvania. (Commonwealth of Pennsylvania, Office of the Governor, News Release, March 7, 2016; Executive Order 2016-02 Minimum Wage for Employees of the Commonwealth and of Organizations Receiving State Contracts https://www.governor.pa.gov/executive_orders/executive-order-2016-02-minimum-wage-for-employees-of-the-commonwealth-and-of-organizations-receiving-state-contracts/.)

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