7 crucial questions about Colorado’s minimum wage fight, answered

Mike Chea doesn’t get a moment of peace.

Working as a security guard at the Colorado Convention Center, Chea is constantly calculating. He’s perpetually making plans about what he’s going to feed his kids for each meal, when he’s going to get home, how much time his oldest daughter will have to watch his three younger children. He worries about how many hours he’ll get to spend with his wife. It’s a balancing act with a stupefying number of variables, and it exhausts him.

Chea makes $11.75 per hour. His low income level dictates every aspect of his life. He says he thinks about money constantly.  

And here’s the kicker: Chea makes well over minimum wage. His compensation rate is 41 percent more than the required minimum for workers in Colorado.

Recent research has demonstrated that people find it nearly impossible to subsist on less than $12 per hour, and having a family makes it even harder. Chea works as much as he can, but can’t always manage to make ends meet.

Chea’s story gives a glimpse into what’s at stake in the minimum wage fight in Colorado, but the debate over specifics is complex. Let The Colorado Independent break it down for you.

1. Who set Colorado’s minimum wage?

Voters agreed on Colorado’s minimum wage, which is currently $8.31 per hour, in 2006.

That year, a ballot measure called Initiative 42 was narrowly approved by referendum. It increased the minimum wage to $6.85 per hour and required incremental, inflation-based increases each subsequent year.

The state has used the same system ever since. But, though tying the minimum wage to inflation usually means yearly increases, it doesn’t always: In 2009, in fact, inflation declined — and, thus, so did the 2010 minimum wage.

Tying the minimum wage to inflation rates has another drawback, too. Regional price differences mean that inflation-based wage increases don’t always cover a family’s needs in any given geographical region. Prices are higher in Aspen, for example, than they are in Alamosa, yet workers in both areas can be paid the same wage.

Mike Chea lives in Littleton, where a Colorado Center on Law and Policy report showed that a family with just two children needs two adults to make at least $18 per hour in order to be self-sufficient. Chea and his wife, who makes $13 per hour working in childcare, have four children.

2. Who’s trying to raise the minimum wage?

A coalition of worker advocates has been working for the past few years to change the state minimum wage so that it keeps pace with the cost of living rather than inflation.

Felicia Griffin, Executive Director of the Front Range Economic Strategy Center (FRESC), told The Colorado Independent that members of an informal group of anti-poverty organizations called The Everyone Economy began to talk about minimum wage years ago. Griffin said it became a major topic of discussion in 2014.

In the 2015 legislative session, Democratic lawmakers advanced two separate bills that would have affected the minimum wage — one by allowing cities to set their own wages, the other establishing a ballot initiative to reach a statewide $12.50 minimum by 2020 — but they were both killed in the Senate.

In the 2016 session, Senator Mike Merrifield pushed forth legislation that would have allowed municipalities to enact their own minimum wages, thereby adjusting for the fact that cost of living varies dramatically by county in Colorado. That bill failed in the Senate as well.

After the bill’s failure, a coalition of anti-poverty groups, labor unions and economic policy advocates formed a coalition to give the people of Colorado a way to raise the wage directly — with, you guessed it, a ballot initiative. Those groups combined to create Colorado Families for a Fair Wage, whose sole objective is to pass Initiative 43, which would increase the minimum wage to $12 per hour by 2020.

These folks have been gathering signatures and raising awareness for their initiative for months now. Griffin said that they have reached 145,000 signatures; they only need 98,000 valid signatures to get on the ballot.

3. Why $12 per hour, instead of $15?

Felicia Griffin of FRESC said that Colorado Families for a Fair Wage’s decision came from polling data that showed that a $12 ballot measure would have the greatest likelihood of passing. “We simply don’t have the power to [raise the wage to $15 per hour]”, Griffin said. “Folks need a raise. We need to be moving in the right direction.”

But critics say that this simply isn’t enough, and smaller subgroups continue to work for $15 an hour. Denver janitors, for example, just signed a new contract that will guarantee them a $15 hourly wage by 2020.

Chea is part of an SEIU campaign to raise security workers’ wages to $15 per hour.  He sees this as a modest raise. “We have big names like Donald Trump come through, and for the amount of responsibility they put on us, we are paid very little,” Chea said.

Griffin doesn’t disagree, and acknowledges that $12 per hour is simply not enough in some Colorado regions. “In places like Denver, people are getting priced out of their homes,” Griffin said. “We just need to give folks help to make ends meet.”

4. Who’s against a minimum wage increase?

The primary argument against raising the minimum wage is that it leads to job losses. The logic is simple: If you force employers to pay their workers more, there won’t be enough money for everyone. Firms will then have to raise prices, which could hurt business and lead to layoffs. But this line of thinking has been increasingly questioned in recent years.

Rich Jones, the director of policy and research at the Bell Policy Center, said that this shift in thinking is the result of on-the-ground research — that is, minimum wage experiments undertaken by various states and cities.

“The economics profession has changed its mind a bit about the minimum wage,” Jones said. “Since the mid-90’s, a bunch of states have raised the minimum wage above the federal wage, and that has created a natural experiment, and a lot of research has been done that has looked at what happened in those different jurisdictions.”

Jones referenced a study from the University of Massachusetts that compared the effect of a greater minimum wage in one county relative to neighboring counties and found little or no impact on job losses there.

Mike Chea is also dubious that raising folks’ wages would inevitably lead to job losses. Every day, he watches events take place at the Convention Center that bring in enormous amounts of money, and he doesn’t see why a bit of that couldn’t be diverted to the people who keep the venue secure.

“Security is looked at as a non-profit part of the organization,” Chea said. “If an event manager brings Comic-Con, they see $200 million,” he said — but security guards don’t get bonuses for such high-profit events. “The only time security [gets any attention] is when something terrible happens.”

Further, some economists say that higher wages make workers more loyal to their employers. Chea thinks that the Convention Center would greatly benefit from increased devotion from workers — he estimates that about 15 security workers have quit in 2016.

“Sometimes, we don’t have enough help to keep all the wheels turning,” Chea said.

5. If cost of living varies regionally, wouldn’t it make sense to set the minimum wage regionally?

Senator Merrifield certainly thinks so. He tried to accomplish exactly that during this year’s legislative session. In giving cities the ability to raise their minimums above state levels, he argued, people could receive the funds they need to succeed in their particular region. This issue is especially prominent in the Denver area and in resort communities like Telluride and Aspen. Some reports have shown that workers in resort towns must live hours away from their workplaces because of prohibitive housing and grocery costs.

Merrifield’s effort was unsuccessful due to a 1999 law that banned cities from setting their own minimum wages, which was passed in response to an effort by Denver that year to raise its own wage.

Other cities nationwide have tried to improve wages for struggling workers, including Seattle and New York City. Seattle’s minimum is currently $15 per hour, and New York is on track to reach $15 by 2019.

Denver may not have reached New York’s cost of living, but Chea says that Denver’s population boom in the past few years has prompted people he knows to consider moving.

“I have friends and family that are talking about leaving Denver to go to other parts of the state,” Chea said. “Denver has gotten really big in a really short amount of time, but the wages have not.”

6. Are there better ways to help low-income families?

Some critics against a minimum wage increase have argued that an expanded earned-income tax credit (EITC) would work better than an increased minimum wage. The Bell Policy Center’s Jones concurs that it’s a good policy. “It does help low-income workers move above the poverty line, and we should be looking at both options,” Jones said.

However, Jones sees a couple of issues with relying on the EITC to lift people out of poverty. The first is that it heavily favors low-wage workers with children. “If you’re a single low-wage worker, the EITC phases out at such a low level that very few people actually benefit from it,” Jones said.

Jones also believes that employers, not taxpayers, should be responsible for improving their workers’ lives. “When people employ a lot of low-wage workers, they profit, and they ask other taxpayers to pay for it if all you do is expand the EITC,” Jones said.

Chea says his employer, the Colorado Convention Center, has behaved in belligerent and even threatening ways to keep its security workers from receiving the wage they feel they deserve. When asked if the Convention Center has threatened to fire people for unionizing, Chea said they had.

“Verbally, not written or anything like that, because it’s illegal,” he said.

7.What’s it like to live on less than $12 per hour?

Each of the 500,000 Coloradans (about 1 in 5) who live on less than $12 an hour has a story about how such a wage impacts their lives.

For Chea, it means serious health challenges. The stress of his job, combined with the stress of constant uncertainty, has eroded his physical and mental health. He also experiences emotional stress: He loves his kids deeply, and it’s painful to try to explain the realities of their life to them.

“Sometimes, my kids want to go see a movie or go get a Slurpee, and it’s hard to explain to them why we can’t do some of the stuff other kids get to do,” Chea said.

Photo credit: Allen Tian