PINE BLUFF — One Friday last month, Shanna Tippen left the house where she sometimes gets by with candles and flashlights, got into her 2003 Chrysler Sebring and drove to work to pick up her first new-and-improved paycheck. The check was stamped at the top with her employer’s name — Days Inn and Suites — and showed the fruits of Arkansas’ long battle over the minimum wage.
Tippen’s new hourly pay is $7.50, up by 25 cents. It is the result of the state, along with 19 others, raising the minimum wage this year in a forceful effort to boost the incomes of the poorest working Americans.
The raise won’t pull Tippen out of poverty. It won’t free her from enduring months when she can’t afford her electric bills. But the extra $2 a day, the extra $520 a year, will mean she can buy Luvs diapers for her grandson, even the pricier kind that doesn’t irritate his skin.
“Not much difference,” Tippen said of the raise, except for the product she buys twice a month. “The diapers, they’re $24.98 at Wal-Mart.”
Like tens of thousands of others in Arkansas and the millions in other states that enacted pay increases, Tippen has found herself caught in the reality of America’s debate on whether to raise the minimum wage.
While politicians frame the discussion in bold terms — a ticket to the middle class; a death knell for small businesses — Tippen’s experiences reflect a more realistic picture: a slight help for poor workers, but not the game-changer that politicians promise.
Even after the pay increase, Tippen’s stack of bills exceeds her income by $200 a month. Businesses all around Tippen, including the fast-food joints she sometimes visits, have nudged up prices to cover the increased labor costs, business owners say.
While some states are increasing their lowest wages, President Barack Obama said in his State of the Union address that he wants to raise the federal minimum to give the “hardest-working people in America a raise.” Still, if Congress authorizes an increase to $10.10, some small-business owners in Pine Bluff say they won’t survive.
“At $10.10, we probably wouldn’t be here anymore,” said Steven Horton, owner of SavUMore Discount Foods.
For Arkansas to enact its minimum-wage increase, it took years of legislative battles, a statewide grass-roots campaign and a November vote. The increase, though small, was resonant in Pine Bluff, a town of 48,000 lined with abandoned pawnshops, ramshackle single-story homes, and still-thriving fast-food joints and dollar stores.
“Mostly everybody struggles in Pine Bluff,” Tippen said.
Tippen, 43, lives with two of her grown children who haven’t been able to find work. There’s also a grandchild, Zayne, who is about to turn 2. Zayne goes through 108 to 120 diapers every two weeks, which means Tippen, the only person in her family who works, spends about $25 of every paycheck on diapers.
Several weeks ago, when Zayne was down to his final diaper, Tippen panicked and realized she didn’t have any cash. So she called a friend, asked to borrow some money and went to Wal-Mart.
“I might not have to do that anymore,” Tippen said.
In Arkansas, the raise comes in steps: to $8 next year and to $8.50 in 2017.
None of this will be enough for workers to escape poverty, but advocates say extra dollars in the pocket of someone making less than $16,000 can’t possibly hurt. Despite warnings about the job-killing effect of the minimum-wage raise, no business in Pine Bluff indicated plans to lay off workers because of the state increase.
“I know there are economic arguments against raising the minimum wage, but I think just purely in a state where folks are poorer and working hard, we know it’s not enough for them to live on,” said Steve Copley, chairman of Give Arkansas A Raise Now, the coalition that led the state effort. “It doesn’t surprise me that ordinary folks would say, ‘Yeah, it’s the right thing to do.’”
Without federal action — the national minimum wage has been at $7.25 since 2009 — states have emerged as the new battleground in the minimum-wage debate. Twenty-nine states, as well as Washington, D.C., now require minimum wages above the federal level.
In Pine Bluff, the wage increase has caused debate about whether companies should deal with smaller margins or raise prices. At Burger King, employee Colby McIntyre sometimes hears customers remark on how prices have gone up since January.
“They went up so I can keep money in this pocket,” McIntyre tells them, laughing.
Dominic Flis, whose company owns 18 Burger Kings in central Arkansas, tells a slightly more complex story. For one thing, beef prices have risen 20 percent over the past year. More broadly, the raises given to minimum-wage workers were only part of the labor-cost increase. The wage increase caused a ripple effect, and hourly workers who weren’t at the minimum were given a commensurate raise.
“If somebody was already making $7.50 already, and minimum wage goes to $7.50, they’ll have some expectation of a raise as well,” Flis said. “And I have to maintain my workforce.”
At the Days Inn, the general manager, Herry Patel, said he opposed the increase.
“[The referendum] was bad,” he said. “Bad for Arkansas. Everybody wants free money in Pine Bluff.”
Tippen has a do-everything job. She works at the front desk, cleans up the continental breakfast bar and helps customers with fresh towels or Internet problems. If she’s working the evening shift, she’ll walk around the property once or twice, playing the role of a night watchman.
She’s worked minimum-wage jobs for much of her life, and the one time she didn’t — earning $8 per hour in 2004 at a payday lender in Sheridan — she set herself up for a major tumble. She’d just gone through a divorce and was terrified of losing her house, she said. She decided, with the help of two acquaintances, to steal $11,200 from her company.
“Pulling it off was easy,” Tippen said, in an account supported by court documents. “The decision to do it was hard.”
Starting in October 2008, she spent nearly a year in jail.
“I lost [time] with my kids, I lost their respect. I lost everything,” Tippen said.
Tippen thinks sometimes about finding a job that doesn’t squeeze her so tightly. A few weeks ago, she noticed a job at a new hotel in Little Rock that pays $10 per hour. She drove up for an interview with Hancock Staffing, the job agency filling the position, and said “everything went well.” She said she was waiting to hear back.
Given the size of her family, she’d need to earn nearly $12 an hour to live above the poverty line. And her family is about to grow — another grandchild who will live with her. The baby girl was expected this month. Tippen will be buying the diapers.