Maine votes to raise minimum hourly wage to $9 next year, $12 in 2020

Posted Nov. 09, 2016, at 1:37 a.m.
Last modified Nov. 09, 2016, at 6:56 p.m.

PORTLAND, Maine — Maine voters decided Tuesday to raise the state’s minimum wage for the first time since 2009, bumping it to $9 per hour next year, from $7.50, and to $12 by 2020 as part of a national push by progressive groups.

The approved referendum also moves the state’s tipped workers to a $12 hourly minimum by 2024, changing the economic landscape for restaurants, whose trade group mounted some of the strongest opposition to the question.

Mike Tipping, a spokesman for the campaign Mainers for Fair Wages, said the vote “shows there’s a fundamental thread of economic justice that runs through our state and our country, no matter what the rest of our results might be.”

Peter Gore, a consultant to the opposition campaign and lobbyist for the Maine State Chamber of Commerce, said he worried the change would put disproportionate pressure on Maine’s rural businesses and that elimination of the trip credit would be a “seismic change” for restaurants and their employees.

“There’s a lot of concern in rural areas about how this is going to translate to jobs, what this is going to mean for prices and whether businesses are going to be able to stay open,” Gore said.

The outcome puts Maine on track to have one of the highest minimum wages in the nation in four years, if nothing else changes, and be the only state east of the Mississippi to eliminate the tip credit. Three other western states voted Tuesday on minimum wage increases, with all measures winning, according to unofficial results.

The statewide increase comes after the longest period of stagnation for the state minimum wage since it was first set at $1 per hour in 1959, according to the Maine Department of Labor. It also follows Portland hiking its local minimum wage to $10.10 on Jan. 1.

Since 2009, Maine’s minimum has been 25 cents higher than the current federal minimum wage of $7.25, set in 2009.

The Maine referendum raises the state’s minimum wage to $9 in 2017 and by $1 each year until 2020. After that, it will be tied to inflation. For tipped workers, the statewide referendum calls for the hourly minimum to rise to $5 in 2017, from $3.75, and by $1 each year until reaching the regular minimum no sooner than 2024.

Gore, with the chamber, said he hopes lawmakers in the upcoming legislature will consider reinstating the tip credit, which allows a portion of an employee’s tips to count toward their hourly pay, for calculating whether they are earning the minimum.

A Bangor Daily News analysis of federal wage data found that in 2015 about 226,000 Mainers worked jobs with an estimated entry-level wage of $9 per hour, mostly in food service and sales. Only a portion of those employees were actually making below $9 per hour, but a bump in the minimum pay level could reverberate up the pay scale.

Based on the 2015 data, raising the minimum wage stands to have the largest impact in Penobscot County, which had both the second-highest number and second-highest share of jobs with entry-level pay below $9 per hour.

The change was shepherded by Mainers for Fair Wages, a coalition led by the progressive Maine People’s Alliance and the Maine AFL-CIO, that ran a $2.8 million campaign. Opposition mounted only a token challenge, raising a little more than $167,000. Gov. Paul LePage was loudly against it, saying backers “should be thrown in jail” for causing price hikes for Maine’s elderly.

The citizen-initiated referendum came after a long fight in the Legislature. The Retail Association of Maine and the Maine Restaurant and Innkeepers associations testified against several minimum wage bills in 2015 that failed to become law amid Republican opposition.

Once the citizen-initiated referendum effort for a $12 minimum kicked off, they reversed course and supported a smaller wage increase, lobbying the Legislature to place a competing measure on the ballot alongside Question 4. Democratic lawmakers blocked it and sent the $12 measure to voters alone.

BDN writer Michael Shepherd contributed to this report.

 

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