As the 2006 Missouri Senate election nears, Missourians are faced with some difficult decisions, whether or not to approve a tax on tobacco products, stem cell research and raising minimum wage.
For the past nine years minimum wage has remained the same at $5.15 an hour despite the spike in gas prices, a rise in the cost of living and an increase in the cost of food. Many arguments have been made in favor and in opposition of raising Missouri’s minimum wage to $6.50 an hour. Minimum wage has lost its real purchasing power and has fallen to historically low levels.
According to the Economic Policy Institute, 22 states plus the District of Colimbia have increased their minimum wages above the federal rate.
Patrick McMurry, professor of economics at Missouri Western believes that Missouri’s minimum wage should not be raised.
“Minimum wage is aimed at heads of households with families at or below the poverty line,” McMurry said.
According to the EPI, over a quarter of a million low-wage workers would benefit from a raise in minimum wage.
McMurry refutes that minimum wage would not effect a lot of people. He also claimed that 53 percent of the people that receive minimum wage are under the age of 25.
The EPI states that raising the minimum wage would not cause job losses. In 1998, EPI study failed to find job loss associated with the 1996-97 minimum wage increase. In fact, following the minimum wage increase, the low-wage labor market performed better than it had in decades, meaning there was lower unemployment rates, increased average hourly wages and increased family income.
Linda Garlinger, director of Career Development, agrees with McMurry that minimum wage does not need to be raised. She also believes that if minimum wage is increased, outsourcing could ensue.
“I think the numbers of jobs would decrease because companies could not afford to hire as many people,” Garlinger said. “There is always the possibility that people will decide to move those jobs to other countries.”
She also said that the service jobs would not move to different countries but that employers might decide to give these workers a salary, which might work out to them making less than minimum wage.
According to EPI, an analysis of the 2005 Current Population Survey reveals that the workers potentially affected by a minimum wage increase are mainly adults who work full-time and provide significant income to their families. A boost in Missouri’s minimum wage would also affect the 102,000 children of these workers.
McMurry disagrees. He estimated that around 60 percent of minimum wage workers worked parttime. He also said that a big chunk of minimum wage workers come from families that make much more than the minimum wage.
“If you want to help the working poor, this is not the way to do it,” McMurry said. “Help the working class with earned income tax credit. Let the working poor keep more of their income.”
Garlinger suggests education and training to be the missing pieces with this issue.
“The government does a good job of providing educational opportunities for people,” Garlinger said.
Claire McCaskill is in favor of raising the minimum wage.
According to her website, claireonline.com, McCaskill believes Missouri’s workers deserve a long and overdue raise and supports increasing the minimum wage.
Jim Talent hasn’t taken a stand on the minimum wage issue.
If the Missourians vote to increase minimum wage, the measure will become effective on Jan. 1, 2007 and will rise each year with inflation.
Filed under: Politics |