Reinarts: Minimum Wage For Disabled Tennesseans Misguided

By Nicholas Reinarts, for the Tennessee Lookout

April 8, 2022

A new bill to mandate that disabled Tennesseans receive the federal minimum wage will harm the progress of workers with disabilities. This well-intended but misguided legislation risks reducing job opportunities for the disabled and fails to address the underlying causes of the disabled pay gap, educational achievement, and healthcare costs.

The bill makes a noble attempt to address a real problem: Disabled Tennesseans make 28 cents less per hour than their non-disabled counterparts. This statistic is concerning, especially to physically disabled Tennesseans like me.

Simply raising the minimum wage for disabled workers will not solve this problem. Based on the extensive literature on the minimum wage, it likely will reduce employment opportunities for the very disabled Tennesseans the legislation is attempting to help.

Wages are determined by the productivity of the worker to the firm. Increased productivity on the part of workers leads to higher wages, which is why over 98 percent of hourly workers earn above the minimum wage. Mandating a minimum wage, however, can eliminate job opportunities for those workers lacking the productivity to command that higher wage.

If a productivity gap is potentially driving the pay differential for disabled workers, this means that a minimum wage would adversely affect job market opportunities for disabled Tennesseans. This would only exacerbate the problem since disabled Tennesseans are already employed at half the rate of other Tennesseans.

A bill to address wage disparities is a noble attempt to address wage issues with disabled Tennesseans, but would likely reduce employment opportunities for the very people it’s intended to help.

A major factor driving the productivity gap, and thus explaining the pay gap, is educational attainment gaps for disabled Tennesseans. While 31 percent of non-disabled Tennesseans have a bachelor’s degree or higher, only 11 percent of disabled Tennesseans do.

How do you increase educational opportunities for disabled Tennesseans? This complex issue is the topic of some of my developing research program; but, based on my findings, there are three easy solutions. The first solution is to address the disabled educational gap by encouraging and improving online schooling, making education opportunities more accessible.

The second solution would be to create dedicated scholarships for disabled Tennesseans at the undergraduate and graduate levels. Disabled Tennesseans are particularly in need of tuition support given that they pay, on average, around $14,000 in additional healthcare expenses per year.

The third solution is for our state lawmakers to pursue any policy to make healthcare more affordable and accessible in Tennessee. Healthcare policies in Tennessee driving up the costs of healthcare include certificate-of-need and scope-of-practice laws. Many certificate-of-need laws on the books in Tennessee, for instance, increase the costs of healthcare and decrease access, with no justifiable reason.

Good intentions do not necessarily lead to good results. Disabled Tennesseans should be making an honest day’s pay; but removing minimum wage exemptions for disabled Tennesseans is not the way to achieve this noble end.

Nicholas Reinarts

Nicholas Reinarts is a Ph.D. Fellow in the Political Economy Research Institute in the Jones College of Business at Middle Tennessee State University. He has Spina Bifida. Follow him on Twitter @ReinartsEcon, and you can find his academic biography and contact information here.

Tennessee Lookout is part of States Newsroom, a nonprofit network of state government news sites supported by grants and a coalition of donors.