Michael Stenhouse, chief executive officer of the Rhode Island Center for Freedom and Prosperity, frequently appears on radio and in public forums to argue for lower taxes and, lately, to oppose efforts to increase Rhode Island’s minimum wage.
Since July of 2009 the federal minimum wage has been $7.25 an hour. States are free to set their own minimum wage rates, as long as they don’t go below the federal level. Last year, the General Assembly increased Rhode Island’s minimum wage to $8 an hour, effective Jan. 1, 2014, and there are proposals to increase it further.
Stenhouse argues that the economic effects of raising the minimum wage are exaggerated by those who want to increase it. Most workers who support a family are already getting more than the minimum wage, he says, while those earning the minimum wage are usually young people supplementing an already above-the-minimum combined family income.
On Jan. 27, in a news release, Stenhouse quantified that claim. Of Rhode Islanders who are earning minimum wage, he said, "only 14 percent serve as sole income earner for their family."
When we asked Stenhouse about his statement, he said the source of the data was the Employment Policies Institute, a business-backed, Washington, D.C.-based organization that produces research critical of state and federal minimum wages.
The employment institute prepared the research for the Rhode Center for Freedom and Prosperity last spring, when the General Assembly was considering raising the minimum wage to $8.25, so that was the figure used in the study. The legislature wound up approving an $8-an-hour minimum wage.
The report is posted on the Center for Freedom and Prosperity’s website, rifreedom.org, with a pie chart that illustrates its findings.
Michael Saltsman, research director of the Employment Policies Institute, told us that its analysis was derived from a regular monthly survey conducted by the Census Bureau for the Bureau of Labor Statistics in which people are asked about their incomes and family status, among other things.
The institute found that, of Rhode Islanders earning less than $8.25-an-hour, 8 percent were single parents and 6 percent were married and the sole family earner.
Stenhouse said he added those together to get his 14 percent. He said he picked those two categories specifically, because he was focusing on families getting by on minimum wage.
We weren’t able to recreate Saltsman’s results, but other groups that have used the same data have ended up with similar findings.
Heidi Shierholz is an economist with the Economic Policy Institute, a liberal research group, based in Washington, D.C., that advocates increasing the minimum wage. She said the numbers Stenhouse used didn’t seem out of line, but she added he was carving a narrow demographic slice from the total population affected by minimum wage increases.
But, as Stenhouse points out, he specifically limited his statement to families, not the broader category of households.
Michael Stenhouse says only 14 percent of Rhode Islanders earning minimum wage or less are the sole earners for their families.
Stenhouse was citing figures from an established research group that another research group, with an opposite political philosophy, found to be credible.
The study he cited was based on an $8.25 wage, rather than Rhode Island’s $8 rate. But that’s not enough to make a big difference. We rule his claim True.