Minneapolis is increased its living wage effective January 22, 2015. But what exactly is a living wage anyway? Well according to the Harvard Living Wage Fact Sheet from Harvard University it is as follows:
The idea behind a living wage is that people who work in a community should be able to live decently and raise their families in that community. This requires a wage and benefits package that takes into account the area-specific cost of living, as well as the basic expenses involved in supporting a family. Although living wage standards do, by definition, vary by region, they are all considerably higher than the federal minimum wage. This is because the minimum wage does not begin to meet the needs of working people or families anywhere in the country: in fact, it puts a parent with one child below the federal poverty line. A living wage aims to correct this by establishing, at a local level, a more reasonable minimum wage.
There are over 140 living wage rates in the United States in various cities and counties. The living wage ordinance usually applies to a city or county contractor who has a contract with the entity to provide goods, services or construction. The rate also usually ties in benefits with the amount of the wage. For example in Minneapolis the rate is $12.82 per hour if the employer provides health insurance and $15.16 per hour if they do not. The logic behind a living wage is that taxpayer money should not be used only to make the business a profit but to also provide the same taxpayers the opportunity for gainful employment.