Economic Analysis of the Arizona Minimum Wage Proposal

This report is a complete economic analysis of the 2006 Arizona ballot proposal to set a $6.75 minimum wage with automatic inflation adjustments. The research was sponsored and published by the Center for American Progress.

Among the studies key findings are:

  • About 345,000 workers--13% of Arizona’s total workforce--will receive wage increases through this measure.
  • The average net income gain for low-wage workers and their families will be between $650 and $700 per year.
  • The total costs of these wage increases to businesses in Arizona will be about $312 million per year, 0.08% of the total sales by these businesses in 2005.
  • These costs can be readily absorbed by businesses and consumers, primarily through very small price increases. A representative restaurant would have to raise the price of a $20 meal to $20.28 to cover its costs of 1.4% of sales.
  • The rough fiscal savings for the State of Arizona would be $4.1 million, the net result of positive and negative impacts on tax revenues, increased public employee wage costs, and savings in state-funded health care programs.

>> Read the full study

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