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Yahoo Finance’s Julia La Roche and Alexis Christoforous break down Amazon study in regards to minimum wage.
ALEXIS CHRISTOFOROUS: An overwhelming majority of Americans think the current federal minimum wage of $7.25 is too low, and more than half support a wage hike to $15 an hour. That's according to a study commissioned by Amazon. And Yahoo Finance's Julia La Roche joins us now with the details. Julia, I thought it was interesting that Amazon commissioned this report. We know they've been criticized in the past for not paying their warehouse workers a living wage.
JULIA LA ROCHE: Well actually, Alexis, they have been quite vocal in recent years about a $15 minimum wage. They raised the minimum wage at Amazon for all of its workers to $15 in October of 2018. Of course, at the time, they did phase out that restricted stock units offering for their workers, which was criticized at the time. But they conducted this survey in collaboration with Ipsos. They surveyed more than 6,000 Americans across geographies and demographics.
And you were just mentioning that $7.25 figure. An overwhelming majority of those surveyed-- 80%, to be precise-- didn't know what the actual minimum wage was. It has remained at $7.25 since July 2009, for 12 years, the longest stretch ever since-- without an increase in that time period. And about half-- about 48% thought that the minimum wage was actually much more generous. But as you were referencing, 80% think it's too low. Just over half, 56%, said they would support an increase to $15 an hour. And those who support that tend to skew a bit younger. Think Gen Z, millennial.
And they did kind of go through-- it was a very comprehensive study, Alexis, going through kind of some of the consequences. They think that, overall, most folks feel like a raise to $15 would really benefit employees, in general, for the most part. And also, they think that one of the drawbacks is that employers, in general, about 56% of respondents think that they might be negatively impacted. Then kind of just digging a bit more in, they think that this might be good for the community, for the country broadly.
More than half think that it would help the economy. Amazon, in their own commentary, said that they think this would actually supercharge the US economy as it comes through the coronavirus pandemic. Keep in mind, 70% of GDP is from consumption. They think that this $15 minimum wage would actually give a bit more in Americans' pockets to actually go out and spend. You know, clothes, shoes, restaurants, vacations, those sorts of things.
ALEXIS CHRISTOFOROUS: Yeah, and we know that it was left out of the latest stimulus package, right? A lot of lawmakers thought that now was probably not the time to burden, I guess, small businesses most of all with that hike in the minimum wage, right, Julia?
JULIA LA ROCHE: Yeah, and you just-- as you mentioned, small businesses. One of the other takeaways, Alexis, it was I think 80% felt that big companies should really be the ones that take the charge here and start to take actual specific actions. So they pointed out companies with 500 or more employees should really play a role in increasing the federal minimum wage. And some of the actual action steps here, 44% said that these businesses should set their own minimum wage at $15 an hour.
What you are seeing more companies do-- Amazon, for example, Signet, the parent company of Kay and Jared, they just announced plans to raise their wages. Starbucks is on a path to raising wages. Walmart is on a path to raising wages. So you are seeing more employers. They also think that these companies should advocate for the government to increase the federal minimum wage. And something-- 28% of respondents think that companies should get their other peers, hold their other peers accountable when it comes to raising those minimum wages. Alexis?
ALEXIS CHRISTOFOROUS: That could be a little tough, but OK, I hear them. Thanks a lot, Julia La Roche.