The Johnson County Board of Supervisors voted to increase the county’s recommended minimum wage to $10.40 per hour, even though the move was symbolic because local governments no longer have that power.
The minimum wage reached $10.10 per hour in March 2017, when then-Gov. Terry Branstad signed a bill taking away the ability of local jurisdictions to set their own minimum wage levels.
Though the minimum wage is unenforceable, Supervisor Rod Sullivan said the board continues to follow the spirit of a 2015 county ordinance, which called for a phased increase in the minimum wage from $7.25 per hour up to $10.10 by 2017. In the years thereafter, the wage was to be indexed for inflation based on the Midwest Consumer Price Index.
Many private businesses that raised the minimum wage in 2015 to comply with the county ordinance continue to follow the board’s recommendations, Sullivan said.
“They’re not going broke, and it was the right thing to do,” he told The Center Square.
A Minimum Wage Advisory Committee investigated whether Johnson County’s minimum wage had any negative economic effects during the time before the state decreed that only it could set the minimum wage. The higher wage gave low-income residents an increase in weekly pay without doing visible harm to the region’s economy, the panel found.
There is little evidence that anyone lost a job or faced reduced hours as a result of the minimum wage ordinance, Sullivan said, adding that the jobless rate in the county declined despite the higher wage level.
Critics have argued that allowing local jurisdictions to set their own minimum wage laws creates a patchwork of ordinances that can complicate the lives of business owners.
The latest recommended minimum wage hike will take effect on Monday. The board approves such inflation-driven increases as a symbolic way to inform businesses about a key problem with the federal minimum wage, Sullivan said. That is, the federal wage is not indexed to inflation, causing many low-wage workers to fall behind in earnings over time, he said.
The board has also put in place a wage schedule for county workers that will require them to make at least $15 per hour beginning on Monday.