HARTFORD, CT — Proponents of increasing Connecticut’s minimum wage are hopeful this week’s announcement by Amazon to boost pay for its U.S. employees to $15 an hour will re-energize the movement.
Connecticut’s current minimum wage is $10.10 an hour. Amazon said Tuesday that its U.S. employees will be brought up to a minimum of $15 an hour in November.
The pay increase will benefit more than 250,000 Amazon employees — including part-time and temporary employees — as well as another 100,000 seasonal employees, the company said. Some employees who already make $15 per hour also will see a pay increase.
Amazon said the effect of the higher pay will be reflected in its forward-looking quarterly guidance.
“Any additional money in workers’ and their families pockets is a positive step forward,” Connecticut AFL-CIO President Lori Pelletier said Wednesday.
“Amazon raising their minimum wage is a direct response to the outcry regarding their awful working conditions as well as poverty wages,” Pelletier said. “You don’t need a degree in economics to understand the more money in families’ wallets the more they can purchase and that will drive the economy upward.”
Amazon and CEO Jeff Bezos have been facing criticism for its pay disparity. Sen. Bernie Sanders last month introduced legislation called the Bezos Act to tax corporations for every dollar that their low-wage workers receive in government health-care benefits or food stamps.
“I want to give credit where credit is due,” Sanders said in response to the announcement. “What Mr. Bezos has done is not only enormously important for Amazon’s hundreds of thousands of employees, it could well be, and I think it will be, a shot heard around the world.”
Amazon is also raising wages for British employees to a minimum of £10.50 ($13.61) for workers in London and £9.50 ($12.31) in the rest of the country.
“We listened to our critics, thought hard about what we wanted to do, and decided we want to lead,” Bezos said in a statement. “We’re excited about this change and encourage our competitors and other large employers to join us.”
Retail rival Target announced in its holiday hiring release it would raise minimum hourly wages to $15 by 2020. Walmart announced plans in January to raise its minimum wage to $11.
The announcement comes ahead of Amazon’s annual holiday hiring push. Last year the e-commerce giant said it would hire 120,000 temporary employees for the holiday season.
In August, national wage growth posted its biggest increase of the economic recovery, according to the Bureau of Labor Statistics. Payroll gains beat expectations and the unemployment rate held near a generational low of 3.9 percent — making holiday hiring tougher for many retailers.
However, back in Connecticut efforts to raise the minimum wage have stalled.
Connecticut’s legislature did not increase the minimum wage this past year despite the fact that the idea has wide support according to polling data. In August, a Quinnipiac University poll found that raising the minimum wage to $15 an hour was supported by 63 percent of the 1,029 voters surveyed.
One vocal proponent of hiking the minimum wage in Connecticut is Rep. Josh Elliott, D-Hamden.
“I absolutely applaud Amazon’s decision to increase their minimum wage,” Elliott said.
“I still have concerns about their work practice of considering many hires to be independent contractors to get out of their state and federal level tax responsibilities, but this is a step in the right direction,” Elliott added. “Of course, now is the time to standardize this wage so that all employees in the state have the ability to provide for their families in the same way.”
Elliott also said the future of any change in the minimum wage rests with the voters on Election Day in November.
“I don’t think that this decision by Amazon is going to change any legislators’ minds,” Elliott said, adding that it’s difficult to prognosticate just based on Amazon’s announcement. “We would need a strong showing by Democrats across the state before a $15 minimum wage is possible — we weren’t even able to get to $12 this year, and we need to have enough Democrats [in the legislature] where losing some [votes on the minimum wage] won’t sink the effort.”
Eric Gjede, a lobbyist with the Connecticut Business & Industry Association, said CBIA, too, applauds what Amazon did — with one important caveat.
“They did it the right way,” Gjede said. “It’s a great thing when a company believes that it must raise wages to be competitive. Connecticut could use more of that competitive environment.”
Gjede said Connecticut doesn’t need to mandate an increase in wages.
“That’s the wrong way to do it,” he said.
Carlos Moreno, state director of the Working Families Organization, said that Amazon did what it did “as a response to public and grassroots pressure. He (Bezos) also understands that wage suppression is not good strategy for economic growth. Legislators and CEOs should take note.”
Moreno said income inequality in Connecticut is among the worst in the nation.
“Growing profits have gone toward the state’s highest wage earners and corporations, further deepening the divide between the rich and poor, which is mostly pronounced in Black and Latino communities,” Moreno said.
Added Kate Farrar, executive director of the Connecticut Women’s Education and Legal Fund: “While Amazon’s action is a positive step forward, the ability to earn a livable wage should not depend on where someone works or the generosity of their employer.”
According to United Way’s 2018 Alice Report, 40 percent of households in Connecticut are unable to afford basic necessities, such as healthcare, child care of food.
“These families need a minimum wage significantly higher than $15 an hour to make ends meet in our state,” she added.
Raising the hourly minimum wage from $10.10 to $15 is favored by gubernatorial candidate Ned Lamont, the Democratic nominee, but not by Republican Bob Stefanowski or petitioning candidate Oz Griebel.
But aside from the outcome of the governor’s race, the future of the minimum wage also depends on the makeup of the next General Assembly.
In 2016, the Connecticut Senate attempted and failed to pass legislation that would have increased the minimum wage to $12 an hour by 2020.
And a House bill that failed in last year’s session would have raised the state minimum hourly wage from $10.10 to $12 on Jan. 1, 2019, and then to $13.50 and then $15 in the following two years.
Among the groups that lobbied loudest against raising the minimum wage were restaurant owners.
“Raising the minimum wage would have a negative impact on the thousands of workers in the restaurant industry,” Scott Dolch, executive director of the Connecticut Restaurant Association said, during a discussion about raising the wage.
Dolch said hiking the rate would “result in the loss of jobs and a raise in rates for consumers.”
