Minimum wage to increase Thursday

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July 22, 2008

from staff and wire reports The Meridian Star Tue Jul 22, 2008, 11:47 PM CDT

The hourly Federal minimum wage will increase from $5.85 to $6.55 Thursday, but few workers nationwide will see the extra 70 cents an hour in their checks.

That's because the proportion of hourly workers paid the federal minimum has fallen from 15.1 percent in 1981 to 2.3 percent in 2007, according to the Bureau of Labor Statistics.

State minimum wages have largely outpaced the federal minimum, which was flat for almost a decade, starting in 1997. When state wages are different from the federal level, the higher wage prevails.

In Mississippi, there is no state minimum wage law. Instead, the minimum wage in the state is the same as the federal minimum wage. Even so, the increase may not make much difference to many workers or employers. Many jobs, like food service, that have traditionally paid minimum wage, have outpaced federal minimum wage laws even in Mississippi.

Gus Lisi, who owns numerous Subway stores in the Meridian area, said his stores won't be affected by the change because all his employees are already paid at least $7 an hour.

"We want quality employees," Lisi said, "and we're willing to pay for that."

At area McDonald's stores some very new employees are paid minimum wage, but not many, according to Amy Brantley, who works in the stores' central office. Most workers, she said, make a minimum of $6.25 an hour, 30 cents below the $6.55 minimum to be imposed starting Thursday.

"It's only 30 cents," she said, "I don't think it'll be that big a change."

John Baas, of the Mississippi Manufacturers Association, said that manufacturing jobs in the state generally pay above minimum wage as well.

"Our members are having difficulty finding employees," he said. "It's hard for them to attract workers at minimum wage."

Louisiana, Alabama, Tennessee, and South Carolina also do not have state minimum wage laws. In 10 states, the state minimum wage is equal to the federal minimum wage. In three states, Georgia, Wyoming, and Kansas, state minimum wage rates are actually below that of the federal minimum wage. Every other state has a minimum wage exceeding the current federal minimum wage of $5.85, according to the U.S. Department of Labor.

Only 1.73 million hourly workers in the United States made federal minimum wage or less in 2007, according to the Bureau of Labor Statistics.

The vast majority of those workers — 1.5 million — made less than federal minimum. That's possible because in most states, companies can pay workers as little as $2.13 an hour if their wage — plus tips — equals the minimum.

So some waiters, bartenders, parking lot attendants and coat checkers must make more in tips than they do in base wages to meet the minimum. If their tips plus wages don't meet the minimum wage, their employers must pay them the difference.

Next year's minimum wage hike to $7.25 an hour, planned for July 24, 2009, has the potential to affect far more workers than the hike this summer, as the federal minimum wage begins to outpace the states' minimum.

By September 2009, the number of states with minimum wages above the federal level will be down to 12, with several states tied with the federal rate of $7.25, according to the Economic Policy Institute.

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