Report: Thousands of Iowans could benefit from Johnson County wage hike

IOWA CITY - An Iowa research organization reported Tuesday that a proposed increase in Johnson County's minimum wage has the potential to impact tens of thousands of people.

A report by the Iowa Policy Project, a non-profit, nonpartisan organization that focuses on tax and budget issues, economic opportunity and energy and environment, forecasts benefits to nearly 20,000 Iowans if Johnson County were to hike the local minimum wage to $15 per hour.

The ordinance being discussed by the Johnson County Board of Supervisors would bring the minimum wage up to $10.10 - not $15 - by 2017, but report author Peter Fisher said during a conference call that it would still have a 'substantial impact.”

'One of the things that people tend to overlook is that we're not looking at just people who currently make $7.25. ... The question is who currently earns between $7.25 and whatever the new minimum is going to be? Those are all people who are going to benefit,” Fisher said. 'It's not just teenagers, six out of seven in fact are age 20 or older and it's not just part-time workers.”

According to the report, a $15 minimum wage would benefit 19,300 Johnson County workers and 24,300 Linn County workers if both counties adopted such an ordinance.

Linn County officials are not currently exploring a minimum wage ordinance.

The report, which considered a five-year increase in the minimum wage to $15 per hour in Linn and Johnson counties, found that, of those who would benefit, 59 percent are women, 58 percent work full-time and nearly a third are over the age of 40. Almost all workers in the two counties living below the poverty line would see a wage increase and money in the pockets of low-wage workers would boost the local economy and lead to more retail and service jobs, according to the report.

'They don't spend on vacations in Tahiti, they tend to spend it locally and they tend to need every penny they earn and have to spend it, so this provides a substantial boost to the local economy,” Fisher said.

Nancy Quellhorst, president and CEO of the Iowa City Area Chamber of Commerce, said the chamber has not taken an official position on the proposed ordinance. Several area business owners - many of whom already pay more than the current minimum - seem supportive of a general wage escalation, she said.

That said, Quellhorst said several employers want to be a part of the conversation.

'I think there is an awareness on the part of many of our local employers that it would be helpful to look at a mandated minimum wage, again with emphasis on doing so so they can join the discussion,” she said. 'They understand the spirit, they just want it to be approached in a very measured way.”

Quellhost added that some employers who already pay near the $10.10 per hour range expressed concern that their wages also would increase as a result, even if they adhere to a new minimum wage ordinance.

Fisher said such a thing is likely to occur, but research shows the overall impact on businesses and employers comes out a positive.

'We're not saying there isn't any individual firm who is going to be affected by this and have cost raised and perhaps not hire as many workers. But when you look at it overall, what the research shows is that overall you can't really find a measurable employment effect in places that pay higher than minimum wages,” he said. 'I certainly wouldn't say that a business isn't going to notice, it's going to have some effect.”

One central question on the county's proposed ordinance, though, is whether it's even legal.

Some state officials say a local rather than statewide increase is unconstitutional. The Johnson County attorney's Office continues to investigate the matter.

Ultimately, Fisher said, the legality of the ordinance could come down to a court ruling.

'My understanding is there is some ambiguity of Iowa law,” he said. 'It may have to be litigated to find out if the county has the authority to set a minimum wage.”

Wage discussion

The Johnson County Board of Supervisors will host a public input session, on increasing the minimum wage in the county, from 6 to 9 p.m. Thursday in Room 203 of the Health and Human Services Building, 855 S. Dubuque St., Iowa City.