Congress passes minimum wage increase

The US House of Representatives passed legislation on Jan. 10 to incrementally increase the minimum wage from the current $5.15 per hour to $7.25 per hour by 2009. The legislation, HR 2, the Fair Minimum Wage Act of 2007, authored by US Representative George Miller (D-CA), will raise wages for nearly 13 million workers, or 10 percent of the US work force, including 610,000 workers in North Carolina. The bill was taken up as the second of six measures that Democrats pledged to pass within the first 100 hours of the new Congress. "In November, American voters signaled a deep dissatisfaction with their economic struggles. That's why they elected a new Congress," said Anna Burger, Secretary Treasurer of the SEIU, the nations largest union. "The minimum wage increase is only the beginning, however. If we expect Americans to work hard, we need to make work pay. Congress must continue to act on issues that affect working families." Roughly five million of the workers who will benefit from the increase will be from the service industry. Service industry giants such as Wal-Mart have drawn sharp criticism in the past for low wages paid to there employees. Sixty percent of the workers affected by the legislation will be women who traditionally make less than their male counterparts for the same work. AFL-CIO President John Sweeney hailed the passage of the bill saying the low-paid workers were long overdue for a raise, but expressed concern for the bill as it moves through the legislative process. "Unfortunately, President Bush has called for a minimum wage raise only if coupled with even more tax breaks for business," said Sweeney. "But business has enjoyed hundreds of billions of dollars in tax cuts since Bush took office. In the last 10 years, in fact, the Republican-led Congress provided corporations with $276 billion in tax cuts and provided small businesses with another $36 billion in dedicated tax breaks." Many say the wage increase to the lowest paid workers is long overdue. It has been 10 years since Congress acted to raise the federal minimum wage, and in that time low wage workers have seen the value of their wage face a slow but steady decline, eroded by inflation. Last year the real value of the minimum wage fell to its lowest level in 50 years. While the legislation will help halt this slide, by 2009, when the legislation is fully implemented, most of the gains workers will see in their pay checks will already be lost to inflation. According to Robert Pollin, professor of economics and co-director of the Political Economy Research Institute at the University of Massachusetts-Amherst, "Adjusted for inflation, it would represent an increase of just about four percent from the current $5.15." The Center on Budget and Policy Priorities, a research group that focuses on fiscal policy and public programs that affect low- and moderate-income families and individuals, also warned the bill does not go far enough in alleviating poverty. An analysis of the legislation by the center states: "While an increase in the minimum wage would raise the earnings of many workers and lift some families above the poverty line, some minimum-wage workers would remain poor. This includes many workers who experience periods of joblessness during the year." In a national climate of wage stagnation, and loss of value in the earnings of the country's poorest, many states have take matters into their own hands. Twenty-one states already have minimum wages that exceed the current federal minimum wage. Nine of those states automatically adjust their minimum wage based on inflation rates to keep low income workers from falling further behind. The federal minimum wage reached its highest value in 1968 when it was roughly $9 per hour in inflation-adjusted dollars.