Wage gains are positive trend, at a minimum

In this final column of 2008, let's focus on six escalating numbers. In this economy, at least something's going up!

$6.15

$6.40

$6.67

$6.79

$7.21

$7.25

These are — or soon will be — the mandatory minimum wages paid Floridians since a law took effect in 2005, setting $6.15 an hour as the state's minimum.

The wage figures have risen annually based on the consumer price index. Four years later, employers now pay a minimum of $6.79 an hour. Come Thursday, Jan. 1, the minimum rises again to $7.21.

That figure stands only until July 4. That's when a federal minimum wage of $7.25 kicks in. Florida employers must then pay the new federal minimum by raising their hourly wage by 4 cents.

That's amounts to a total increase of $1.10 per hour since the first Florida minimum wage was set in 2005.

As long as the state minimum wage topped the long-standing federal minimum wage of $5.15 an hour, Florida businesses paid the higher state wage.

Come July, the new federal minimum of $7.25 outpaces the state's $7.21.

At first glance, these minimum wage gains look pretty sweet. Given the suffering economy, plenty of folks work at companies where wages are frozen or rising at a slower pace than the minimum wage.

Going from the current $6.79 an hour to $7.21 on Thursday is a 6.2 percent raise. I won't see that gain in my paycheck come Thursday. I suspect most readers won't.

Now some business groups claim the rising mandatory minimum wage is the root of much evil and is even a major culprit for the increasing national and Florida unemployment rates. One anti-minimum-wage group in Washington called the Employment Policies Institute argues last year's mandatory hike caused increased job loss in Florida, especially among more vulnerable groups.

I could argue that the modest increases in minimum pay help those who received those wages to defray some pretty sharp increases in basic living expenses, from rent to electricity. Let's play along for now and look at these wages over an entire year.

In 2005, a $6.15 hourly wage paid an annual paycheck of $12,792. Come July, the $7.25 hourly wage translates to a $15,080 annual paycheck. That's a difference of $2,288, or 18 percent, stretched over 41/2 years.

It's all a bit funny. Most people, even those just starting out, already earn more than the minimum wage.

Most businesses that gripe about the rising minimum wage run restaurants that require bundles of low-wage workers. Tampa's Outback Steakhouse chain has long fought against the raises.

But many others specify in SEC filings that rising minimum wages in Florida and other states remain one of their biggest cost increases.

In December alone, chains ranging from BJ's and Landry's to Steak & Shake and Bob Evans all blame rising minimum wages for rising costs.

It's unfortunate timing that the $7.25 federal minimum wage takes effect in mid 2009, just when experts say the economy should start to turn.

For now, the rising minimum wage is a positive trend. Let's just make sure it stays that way in the years ahead.

Robert Trigaux can be reached at trigaux@sptimes.com.

Wage gains are positive trend, at a minimum 12/29/08 [Last modified: Thursday, January 1, 2009 1:48am]

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