The minimum wage of a worker in the U.S. should be $22 an hour to keep up with the rate of production, says Sen. Elizabeth Warren, D-Mass.
"If we started in 1960, and we said that, as productivity goes up — that is, as workers are producing more — then the minimum wage is going to go up the same," Warren said. "And, if that were the case, the minimum wage today would be about $22 an hour. So, my question, is what happened to the other $14.75?"
Her comments were raised during Senate Committee hearing on Health, Education, Labor and Pensions last week.
Debates on the nation's minimum wage have increased since President Barack Obama called for a hike in the minimum wage from $7.25 an hour to $9 during his State of the Union Address.
University of Massachusetts Amherst professor Dr. Arindrajit Dube confirmed Warren's calculations. Dube noted that the minimum wage would be closer to $33 an hour rather than the current $7.25.
"Had the minimum wage grown at the same pace with incomes going to the top 1 percent of tax payers, the minimum wage would have stood $33 an hour before the recession in 2007," said Dube."
Warren was drawing attention to the results of a recent study that showed flat minimum wage growth over the past 40-plus years that also took place as inequality across several economic indicators grew.
During the hearing, the Democratic senator also argued that raising the federal minimum wage to over $10 an hour in a series of steps over the next two years would not pose as great a risk for businesses.