The Joplin Globe, Joplin, MO

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July 25, 2012

Advocates on both sides of minimum-wage debate gear up

Separate campaigns to boost the minimum wage around the country and in Missouri are building momentum, and advocates on both sides of the question are gearing up for a fight.

This week, rallies were held around Missouri and elsewhere in the country to draw attention to the issue of the federal minimum wage.

This week marks the three-year anniversary of the last time the federal minimum wage went up, said Sean Nicholson, executive director of Progress Missouri, a nonprofit group supported by churches, unions and community action organizations.

Progress Missouri also is behind an effort to get a $1 minimum-wage increase on the November ballot in Missouri.

Nicholson said the group has more than the 350,000 signatures required to get the measure on the ballot. It is awaiting certification of the signatures by the Missouri secretary of state. That is expected around Aug. 7, he said.

Legislation in Congress, meanwhile — including the Rebuild America Act introduced by Sen. Tom Harkin, D-Iowa, and a similar proposal by Rep. Rosa DeLauro, D-Conn. — calls for stepping up the federal wage floor to $9.80 an hour by July 1, 2014.

The minimum wage in Missouri, Kansas and Oklahoma is $7.25 an hour, as is the federal minimum wage.



‘A good thing’

Jim Martino, owner of the Mall Deli in Pittsburg, Kan., said Tuesday that he believes it is time for the minimum wage to rise.

“My first reaction is, ‘That’s a good thing,’” he said. “When the last increase went into effect, I was all for it. It affects me directly because we employ a lot of minimum wage-plus people, but it has been years since it was raised.”

Martino said a wage increase might force him to increase prices at his popular destination, but he said it also could be a shot in the arm for a sagging economy.

“Most business owners have to keep their payroll at a certain percentage of sales, so you do what you have to do, but for the general economy it’s great,” he said.

Martino acknowledged that a raise for his minimum-wage earners would mean raises across the board.

“You have some at minimum wage, but for those people that were above minimum wage, you have to reflect that change in their wages also,” he said. “It doesn’t just affect those at the very bottom. It affects everybody.”

Nicholson said that right now, an employee working full time for minimum wage earns barely $15,000 a year.

“If you work hard and play by the rules, you should be able to make a living,” he said.

Pay for CEOs and other top executives continues to rise, and Nicholson said that had the federal minimum wage been adjusted for inflation since it started in 1968, it would be more than $10 an hour.



‘A Stupid idea’

The push for an increase in the federal minimum wage is unwelcome news for some of the state’s leading business organizations, including the National Federation of Independent Business and the Missouri Chamber of Commerce and Industry.

Dan Mehan, executive director and CEO of the Missouri chamber, said increasing the minimum wage is “a stupid idea.”

He said an increase could have the opposite result of the one the supporters desire.

“The consequences are very problematic,” he said. “It will retard the growth of business in the retail segment and hospitality.”

Wages should be determined by supply and demand, he said.

Mehan said 70 percent of Missouri businesses are on the state’s borders and compete with businesses in nearby states, such as Illinois, Kansas, Iowa and Oklahoma. The proposal to raise the minimum wage in Missouri, if it passes, would make it harder for businesses in Joplin, St. Joseph, Kansas City, St. Louis and elsewhere on the borders to complete, he said.

“We are going to be less competitive in Missouri than in Oklahoma,” he said.

Mehan also said raising the minimum wage would lead to wage pressure for all employers, including those that pay more than the minimum wage. He said many employers also are unsure about the costs associated with the federal health care law and how that will affect the bottom line.

“If you want to make it more difficult to grow the economy back to where we want it, then vote for this thing,” he said.

David Ruth, owner of the Sonic Drive-In in Neosho, said increases in the minimum wage typically get passed on to the consumer.

“I opened the Sonic in Neosho in the winter of 1974,” Ruth said Tuesday. “A hamburger cost 60 cents; minimum wage back then was about $2 an hour. The only time I’ve raised prices since then is when the minimum wage went up. Now minimum wage is $7.25, and it costs you $3 for that same hamburger. We can move the minimum wage up to $10 per hour as long as the general public doesn’t mind paying $6 for a hamburger.”



28 million workers

According to the U.S. Bureau of Labor Statistics, teenagers last year made up 23.5 percent of minimum-wage earners; 26 percent were 20 to 24 years old, and 50.5 percent were 25 or older. The agency also notes that the majority of minimum-wage earners are employed in the service industry — food, retail and hospitality. Nationwide, a minimum-wage increase would affect an estimated 28 million American workers.

“We need to put more money in the pockets of those workers who line the foundation of the economy,” said Christine Owens, executive director of the National Employment Law Project, one of the organizations pushing for an increase in the minimum wage at the state and federal levels.

Owens said many corporations have recovered from the recent recession and are recording record profits.

But if wages rise, employers may hire fewer people, and that would hurt the least-skilled employees — many of them young workers.

“Our nation’s teen unemployment rate is still near 25 percent,” said Michael Saltsman, research fellow at the Employment Policies Institute, in a report this month. “Legislators should avoid policies that will further depress teen job prospects, depriving the country’s youth of the opportunity to gain important real-world experience.”

President Barack Obama campaigned in 2008 in favor of minimum-wage growth but has not acted on the issue.

Republican presidential challenger Mitt Romney said earlier this year that he agreed with indexing the minimum wage to inflation, but more recently he has said a minimum-wage increase isn’t necessary.



THE ASSOCIATED PRESS contributed to this report.





Around the horn

EIGHTEEN STATES and the District of Columbia have minimum wages higher than the federal floor of $7.25 an hour, according to the U.S. Department of Labor. The state of Washington this year was the first to raise its minimum wage above $9 an hour. Twenty-three states have state minimums at the federal standard.

FOUR STATES have lower state minimums, and five states have no minimum-wage law. Federal rates apply in those nine states, with rare exceptions for certain types of jobs.

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