By Steve Giegerich
St. Louis Post-Dispatch, July 22, 2009
The federal minimum wage is scheduled to go from $6.55 to $7.25 on Friday, a pay bump for 4.5 million Americans and cause for conflicting opinions among various special interest groups.
In one corner, the Employment Policies Institute — fearful that the rising minimum wage salaries will compel small business owners to reduce payrolls — is asking lawmakers to put the increase on hold.
On a “Countdown to Job Loss” Website, the Employment Policies Institute cites data that indicates a rise in the minimum wage will further balloon the nation’s unemployment rate (9.5 percent) while displacing disproportionate numbers of teenagers and young African American and Hispanic male workers from their jobs.
Countering that argument, “Business for Shared Prosperity” has trotted out various executives and advocates to extol the virtues of a minimum wage increase.
“History has proven time and again that increasing the minimum wage increases purchasing power among people who are living hand to mouth and therefore spend the additional income on necessities — food, clothing, transportation and so on,” said the former CEO of the Stride Rite Corp., Arnold Hiatt, one of several executives that contributed a statement a release the organization e-mailed to reporters.
Finally, the Economic Policy Institute weighs in with the argument that the event dubbed by some as “Minimum Wage Increase Day” falls a bit short of reason to celebrate.
Crunching the numbers, the institute found that since 1979 real dollar value of the minimum wage has declined (from $8.02 to $6.55) while the educational level of the average minimum wage earner has risen.
Thirty years ago, the institute says, only 57 percent of the employees drawing the minimum wage had completed high school. Today, that number stands at 72 percent.
Missouri’s minimum wage workers, who saw their salaries rise to $7.05 an hour in January, will start earning another 20-cent per hour — courtesy of the federal government — come Friday.
The minimum wage in Illinois, $8 per hour, will remain unchanged.
To all due for a raise on Friday, congratulations. Don’t spend it all in one place.
Copyright 2009 St. Louis Post Dispatch
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