Remarks on the Minimum Wage

Good morning. When we scheduled this out here, we had a different forecast. [Laughter] But here we are, the hardy party. [Laughter]

Today marks the completion of 2 full years of economic reports in our administration. This morning the Department of Labor reported that nearly 6 million jobs have come into our economy since I took office 2 years ago; 1994 was the best year for job growth in a decade. The unemployment rate has dropped 20 percent in the last 2 years, and the combined rates of unemployment and inflation are at a 25-year low. Ninety-three percent of this job growth has been in the private sector. That's the highest percentage of private sector jobs created in any administration in half a century, 8 times as many per month as during the 4 years before I took office. The majority of these jobs have been created in higher wage occupations. And in the 12 years before I took office, while our economy lost 2 million manufacturing jobs, in the last 17 months we have gained 300,000 manufacturing jobs.

I'm proud of this record, but I am also keenly aware of the fact that not all Americans have benefited from this recovery, that too many Americans are still in what the Secretary of Labor has called the anxious class, people who are working harder for the same or lower wages.

From the end of World War II until the late 1970's, the incomes of all Americans rose steadily together. When the wealthiest Americans did better, so did the poorest working Americans in roughly the same proportion. But since 1979, the income of the top 20 percent of our people has grown significantly, while the income of the last 80 percent grew barely at all or not at all or actually dropped. Much of the problem in the widening income gap among working Americans depends upon whether they have skills or not to compete in the global economy.

A male college graduate today earns 80 percent more than a person with only a high school degree. That's why we've pursued the far-reaching education agenda that the Members here on this platform have been so actively involved with, making it easier and more affordable to get college loans. That's why I proposed the middle class bill of rights to help parents with their children's education and with their own and to improve the way we provide help to workers who are trying to get retraining skills.

But another no-less-important part of this problem is the declining value of full-time wages for many, many jobs. I believe if we really honor work, anyone who takes responsibility to work full time should be able to support a family and live in dignity. That is the essence of what I meant in the State of the Union Address and what I have talked about for 3 years now with the New Covenant. Our job is to create enough opportunity for people to earn a living if they'll exercise the responsibility to work.

That's why we fought so hard to expand the earned-income tax credit, a working family tax cut for 15 million families in 1993; precisely why we're calling on Congress today to raise the minimum wage 90 cents to $5.15 per hour. The only way to grow the middle class and shrink the under class is to make work pay. And in terms of real buying power, the minimum wage will be at a 40-year low next year if we do not raise it above $4.25 an hour.

If we're serious—let me say this, too, emphatically—if we are serious about welfare reform, then we have a clear obligation to make work attractive and to reward people who are willing to work hard. I hope more than anything that we will have a genuine bipartisan, wellfounded welfare reform legislation this year that will encourage work and responsible parenting and independence. But we cannot hope to have it succeed unless the people we are asking to work can be rewarded for their labors.

Let me close with one observation about recent history. In 1990, Congress raised the minimum wage according to the exact same schedule I proposed today, 45 cents a year for 2 years. That increase was passed by overwhelming majorities in both Houses with, let me emphasize, majority support from both parties. This has always been a bipartisan issue.

If in 1990, because the minimum wage had not been raised in such a long time, a Republican President and a Democratic Congress could raise the minimum wage, surely, in 1995, facing the prospect that work, full-time work could be at a 40-year low in buying power unless we act, a Congress with a Republican majority and a Democratic President can do the same for the American people.

Thank you very much. And thank you all.