A proposal that would gradually raise Pennsylvania’s minimum wage passed the narrowly-divided House on Tuesday.
House Bill 1500 increases the rate from $7.25 to $15 per hour by 2026 – and binds it to inflation “thereafter.”
Pennsylvania and 19 other states still offer minimum wages aligned with the federal rate of $7.25 per hour. The rest – including all the commonwealth’s neighbors – have increased pay to between $10 and $15.
That means, supporters say, a minimum wage worker in Pennsylvania earns just $15,000 annually. The proposal boosts the rate to $11 in 2024 and raises the tipped wage from $2.83 to 60% of the minimum rate. So, when the minimum wage reaches $15 in 2026, a tipped worker would earn $9.
The proposal faces long odds in the Republican-controlled Senate, however, at least one has already cosigned the idea, as The Center Square previously reported. Still, it will be a heavy lift.
Federal data shows just under 64,000 residents make $7.25 or less an hour and nearly three-quarters of those include tipped workers. Another 418,000 make up to $12 an hour, and 510,000 earn between $12 and $15 per hour.
Further, the number of “at-or-below” workers declined more than 40% between 2017 and 2022 – largely due to the pandemic-induced labor shortage.
The Keystone Research Center said one in four workers would benefit from a $15 minimum wage, which would boost annual earnings by an average of $4,300.
Most of those workers, according to the center, include women between the ages of 20 and 39 and people of color, while 18% are over the age of 55.
Critics of the policy argue that businesses will cut positions or reduce hours to cover the cost of wage mandates, erasing its economic benefits for workers. A recent analysis from the Independent Fiscal Office found that a $12 an hour rate could cost Pennsylvania 5,000 jobs.
