Minimum Wage Increase in 2009

[George Boutwell]

Congress just raised the minimum wage to $7.25, right?

Well, sort of. What they did in the bill that the President is expected to sign, is raise the 2009 minimum wage to $7.25.

The first raise comes 60 days after the bill is signed (so don't expect him to hurry), when it goes to 5.85. A year from that date, it goes to $6.55. It's not for another year that it hits the $7.25 level.

I took a look at the EIC tables to see how this would affect amounts paid to minimum-wage workers. If someone works all year (2080 hours) at minimum wage, they earn $10,712 a year and qualify for a maximum $107 "EIC,single, no kids" and $4,290 "EIC, single, two kids." In 2009, using the 2006 tables and $15,080 W-2 income, the "EIC, single, no kids" would be gone, but the "EIC, single, two kids" would increase to $4,480.

Of course, very few people work all year full-time for minimum wage. But a lot of people who work for $2 an hour above minimum wage, will get raises also because the rising tide lifts all boats.

[Jiggers]

Minimum wage increase

Of course, very few people work all year full-time for minimum wage. But a lot of people who work for $2 an hour above minimum wage, will get raises also because the rising tide lifts all boats.

Not necessarily so. Many moons ago when the minimum wage was $1.60 per hour, I worked at a large employer (30 employees at that time) and was making probably $2.00 per hour because of merit. When the minimum wage increased to $2.00 per hour, I did not get the $0.40 per hour increase. When I questioned it, I was told "sorry".

[George Boutwell]

I did not get the $0.40 per hour increase. When I questioned it, I was told "sorry".

And so you no longer work there. I would say lessons learned, for both you and your employer.

[Chief]

Minimum wage and its impact

I am going to show my age with this posting. When I was 15 years old I worked in a woolen mill having lied about my age. I was paid at the rate of 40 cents an hour. I remember when the minimum wage was first established at 75 cents per hour. I was so excited about nearly doubling my pay. Never since then have I received such an increase in pay.
It's about time that the minimun wage is raised. It will in time be reflected in everyone's pay. Also the cost of goods and services will reflect that increase. It is better reflected by the rate of pay than for the cost of petroleum products which profits mainly foreign companies.

[JoshinNC]

This is a boom for the unions

Not necessarily so. Many moons ago when the minimum wage was $1.60 per hour, I worked at a large employer (30 employees at that time) and was making probably $2.00 per hour because of merit. When the minimum wage increased to $2.00 per hour, I did not get the $0.40 per hour increase. When I questioned it, I was told "sorry".

Most union contracts are tied to minimum wage. For example, let's assume that all UAW employees recieve a contractual wage of 2.5 times minimum wage. If it increases they recieve a raise.

FOLLOW THE MONEY!!!

[Joe Btfsplk]

40 cents per hour

I am going to show my age with this posting. When I was 15 years old I worked in a woolen mill having lied about my age. I was paid at the rate of 40 cents an hour. I remember when the minimum wage was first established at 75 cents per hour. I was so excited about nearly doubling my pay. Never since then have I received such an increase in pay.
It's about time that the minimun wage is raised. It will in time be reflected in everyone's pay. Also the cost of goods and services will reflect that increase. It is better reflected by the rate of pay than for the cost of petroleum products which profits mainly foreign companies.

I lied about my age too and got a job paying 40 cents an hour working Saturday nights helping stuff the Sunday comics in the paper (the comics were probably shipped in from somewhere else).

However it wasn't long that my hard work was rewarded by a raise to the lofty salary of 45 cents per hour.

Some of the paper-stuffers quit the paper stuffing job and joined the National Guard which paid a little better for attending a weekly training session. But better yet, you could join the service for ONE year and get the GI bill to pay your way thru college--and none of those guys ever were called to active duty.

[Corduroy Frog]

It's About Time

I happen to know several families making less than $7.25 and they are not able to pay their bills. Unless there are two family members working, or a live-in boyfriend/girlfriend, they cannot survive in a $3/gallon economy.

I would rather see the minimum wage raised to $10/hr, and the EIC eliminated.
The EIC giveaway would be converted into a jobs credit to subsidize employers who are impacted by the increase.

I'm amazed that for all the tax plans launched by politicians who claim to create jobs, NONE of them have succeeded in legislating a jobs credit - the most direct possible way for the tax code to reward employers who create W-2 income.

[George Boutwell]

Urban Employment Legend

Most union contracts are tied to minimum wage. For example, let's assume that all UAW employees recieve a contractual wage of 2.5 times minimum wage. If it increases they recieve a raise.

Your source for that? I can find dozens of online commentators questioning that assertion, but no one providing an answer.

[veritas]

I happen to know several families making less than $7.25 and they are not able to pay their bills. Unless there are two family members working, or a live-in boyfriend/girlfriend, they cannot survive in a $3/gallon economy.

I would rather see the minimum wage raised to $10/hr, and the EIC eliminated.
The EIC giveaway would be converted into a jobs credit to subsidize employers who are impacted by the increase.

I'm amazed that for all the tax plans launched by politicians who claim to create jobs, NONE of them have succeeded in legislating a jobs credit - the most direct possible way for the tax code to reward employers who create W-2 income.

If you raised the minimum wage to $10 you would harm the people you are trying to help. Employers either have to increase prices for manadates. Cut back on production by eliminating jobs or investment. Or move the jobs somewhere else. Or a combination of all tree. Which outcome do you like best?

[George Boutwell]

Which outcome do you like best?

Increase efficiency by better management and improved workforce productivity.

Well, at least it worked for Henry Ford.

[Holland]

Let's bring back slavery

If you raised the minimum wage to $10 you would harm the people you are trying to help.

In other words, higher pay always harms employees. So lower pay should help them, right? Therefore, we can maximize benefits to employees by bringing back slavery. No tax for slaves to pay!! No EIC!! Yay!

[jainen]

we have lost the leadership

>>If you raised the minimum wage to $10 you would harm the people you are trying to help. Employers either have to increase prices for manadates. Cut back on production by eliminating jobs or investment. Or move the jobs somewhere else.<<

If this were true, why wouldn't companies cut back on the CEO salaries? The problem with the bottom of the income barrel is that it is not a healthy place. Pay the workers enough for a decent lifestyle, and they will improve their housing, get better nutrition, find more reliable transportation, see a doctor -- all things that improve worker productivity.

It was union wages that turned this country into the world industrial leader. Now that we have lost the wages, we have lost the leadership.

[veritas]

I don't know

"If this were true, why wouldn't companies cut back on the CEO salaries?"

Does your local subway franchise have a CEO? Or the independently owned Shell Station?

[veritas]

In other words, higher pay always harms employees. So lower pay should help them, right? Therefore, we can maximize benefits to employees by bringing back slavery. No tax for slaves to pay!! No EIC!! Yay!

Higher pay is good for those who earn it. Mandating higher pay is just intervention in the market place. Like tarriffs on imported goods.

So if the premise of government intervention in mandating artificial wages is good. Why not mandate $15 an hour?

[George Boutwell]

Speaking of (S)Hell

Or the independently owned Shell Station?

It has become almost a regular stop for San Francisco tourists. Once they've seen the Golden Gate Bridge and the Transamerica Pyramid, they can drive down Harrison Street to see the most amazing sight of all.

Regular gas for $4 a gallon.

Actually, it is higher than that. At Bob Oyster's Shell station at Sixth and Harrison, regular is $4.33 a gallon, plus is $4.43, and "V-Power'' is $4.53. Motorists can be seen rolling their eyes as they drive by. Just another example of a greedy station owner, sticking his customers for all they are worth?

Not really.

There's a much deeper story here, and it begins with Oyster, a respected, self-made businessman who turned a single station into Oyster Petroleum, a profitable firm in Redwood City. Oyster is nobody's fool. Don't think he isn't well aware that the Chevron station across the street is selling regular for 70 cents less.

Putting the price way up over $4 a gallon isn't about making a profit. It's about making a statement to a multinational corporation. After Shell forced him to pay higher prices for gas in San Francisco and jacked up his rent, Oyster says, he decided to fight back.

"I got fed up,'' Oyster admits. "It makes a statement, and I guess when people see that price they also see the Shell sign right next to it.''

In fact, far from making a huge profit, Oyster is going out of business. He has operated the Shell station at Sixth and Harrison for 22 years, but he's walking away from it at the end of the month, handing over the keys to Shell officials and expecting them to shut it down.

"I'm getting nothing for the station,'' he says. "I just give them the keys and walk away. They told me they were probably just going to fence it and bulldoze it anyway.''

For franchise dealers like Oyster, it is the ultimate irony. At a time when the oil companies are posting record profits, the little guys are struggling to stay in business. And many, like Oyster, are giving up the fight.

"The dealer can no longer be competitive,'' says Dennis DeCota, executive director of the California Service Station and Automotive Repair Association. "The companies are squeezing these guys out. Bob's tired of it, and a lot of us are. It's just wrong.''

http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2007/05/10/MNGUKPOGKJ1.DTL