Supporters say Nebraska minimum wage hike would lift thousands out of poverty

LINCOLN — Karen Anthony has worked as a home health care provider for 40 years, and in that time she has never earned more than $12 an hour.

Her wages aren’t enough to allow her to afford everyday essentials like a car or even groceries. The house she lives in has leaks and other issues that she’s learned to live with, rather than repair.

Anthony shared her story at the Nebraska State Capitol this past week during a public hearing on a ballot initiative to raise the state’s minimum wage to $15 an hour by 2026. Anthony said that increase barely “scratches the surface” of what most workers need, but $12 an hour certainly isn’t cutting it for her.

“I don’t want a raise just for me, even though I definitely deserve it,” Anthony said. “I want a raise for everyone like me.”

If passed by Nebraska voters in the upcoming election, the proposal would raise the state’s minimum wage in four annual steps. It would increase from the current $9 per hour to $10.50 per hour on Jan. 1, eventually reaching $15 per hour by 2026. The measure also would provide for annual cost of living increases, starting in 2027.

Since 2014, 30 states have raised their minimum wage as the federal level has held at $7.25 per hour, according to tracking by the Economic Policy Institute, a think tank based in Washington, D.C. This includes Nebraska, which raised its minimum wage through a 2014 ballot initiative. If the latest initiative passes next month and no other states raise their wages further by 2026, Nebraska will have one of the highest minimum wages in the U.S., tied with California and just below Washington, D.C.

Opponents and proponents of the measure have largely focused on how raising the state’s minimum wage will impact the economy, with supporters arguing that it would be a boon, and critics claiming the opposite.

Gov. Pete Ricketts has opposed the initiative, arguing that wages should be dictated by the market, not the government.

Laura Ebke, a senior fellow at the Platte Institute and a former state lawmaker, made a similar argument. She said raising the minimum wage would have the biggest impact on rural Nebraska.

When the state was preparing to increase its minimum wage to $9 an hour, Ebke said small-business owners in her hometown of Crete (population roughly 7,000) stated that they just weren’t going to hire high school workers anymore to make up for the added cost. In more populous areas, where higher wages are more common, raising the minimum wage doesn’t have as big of an impact, Ebke said. But statewide wage mandates often don’t consider smaller towns.

“That’s the demographic in Nebraska that gets hurt the most,” Ebke said.

Katie Bohlmeyer, policy and research coordinator for the Lincoln Independent Business Association, also said raising the minimum wage will disproportionately hurt small businesses and allow bigger corporations to consolidate market share, which could lead to rising costs amid record inflation.

Supporters argue that raising wages will actually offset the effects of inflation. Joey Adler Ruane, policy director at Open Sky Institute, said the initiative would be enough to lift more than 10,000 Nebraskans out of poverty.

“Arguing that the minimum wage should only be raised after the current inflationary outbreak is far in the past is arguing that low-wage workers should have no serious protection against the damage to living standards being done,” he said during the hearing.

Supporters also argue that increasing pay would encourage workers to put their money right back into the economy, claiming that those who would benefit from the initiative are the most likely to spend money at their place of employment and surrounding businesses.

Ebke countered that’s only possible if businesses don’t also have to raise their prices to a point that hurts consumers.

Julie Sonderup, whose family owns two Nebraska businesses, said after they decided to increase their wages to $15 an hour for all employees during the COVID-19 pandemic, it made a huge difference in her employees’ quality of life and improved their productivity and general attitudes.

“It has not hurt us at all,” Sonderup said during the recent hearing at the Capitol.

Bohlmeyer, who led the opposition at the hearing, argued that most Nebraska businesses already pay above minimum wage, and that only a small percentage of workers make minimum wage, with most of them being young people.

Kate Wolfe refuted that claim. Wolfe is the campaign manager for Raise the Wage Nebraska, the group that led the effort to get the minimum wage question on the ballot. Citing research from the National Employment Law Project, Wolfe said 75% of the Nebraska workers who would benefit from the wage increases are over 20 years old, and a majority of them are women.

Multiple women who have been in the workforce for decades testified in support of the measure at the hearing. Aside from Anthony, another woman said her low wages have prevented her from living independently — she currently lives with her parents even as she raises a child of her own.

With just a few weeks left before Election Day, Nov. 8, Wolfe said she is confident there is enough voter support to pass the initiative. At the hearing Anthony spoke at in Lincoln, she was one of 13 people who spoke in support, with just three people speaking in opposition.

Minimum wages increases have found support from voters in recent years, even in more conservative states. Florida voters decided in 2020 to gradually increase that state’s minimum wage to $15 an hour. Two years earlier, voters in Missouri and Arkansas approved minimum wage increases. And in neighboring South Dakota, voters approved a minimum wage increase in 2014, the same year Nebraska’s minimum wage increase passed by 19 percentage points.

The Raise the Wage group lists the ACLU of Nebraska, Nebraska Appleseed, Nebraska State AFL-CIO and OutNebraska among its more than two dozen coalition partners.

Wolfe said general election campaigning hasn’t been much different from the campaign to gather enough signatures to make it onto the ballot — an effort that gathered more than 97,000 verified signatures of the roughly 86,000 required.

The focus since then has mostly been on getting the word out that the measure will be on the ballot, Wolfe said. Based on feedback during the petition drive, Wolfe said most Nebraskans seem to support the idea of raising the minimum wage.

“We’re a people of helping other people,” Wolfe said.