$15 an hour. What would that mean for New York workers?
ROCHESTER, N.Y. (WHEC) — In consumer news, I’m taking a look at the minimum wage. Walmart surprised us all Thursday with a big announcement. It’s raising the minimum wage for 425,000. Is Walmart jumping on the $15 an hour bandwagon? After all, rivals Target and Amazon raised the minimum wage to $15 an hour for their employees last year. No. Walmart is not going that far. Only the folks who work in Walmart’s stocking and digital departments will now get an average wage of just over $15 an hour. All new employees will still start at $11 an hour.
Politicians fight a lot about whether to raise the minimum wage. So I wanted to take a look at what $15 an hour actually means for the worker. A worker making $15 an hour working 40 hours a week for 52 weeks a year would gross $31,200 annually. But of course Uncle Sam has to have his share.
In this tax bracket, that’s 12% leaving him with $7,456. But wait. Of course Social Security needs its share. That 6.2% leaves this worker with about $25,754 annually. And then there’s Medicare which takes 1.45% leaving him about $25,384 a year which is very close to the median household income in Rochester.
But when the government determines whether you’re above the poverty level, it looks at your gross wages. Remember, before taxes, this worker makes just over $31,000. So if he’s the wage earner for a family of four, he is now over the federal poverty level, but this family would still qualify for SNAP, the state food assistance program. The qualification for SNAP for a family of four is $34,068 or less. So now when politicians are wrangling about $15 an hour, we get a sense of what it means for the worker.
But what does this mean for the employer, especially small businesses. Is $15 an hour a budget buster they simply can’t bear? That’s a question on which the politicians cannot agree. I’m following every nuance of that debate and will break it all down for you here in consumer news.