Minimum Wage Increases Today

The federal minimum wage increases to $7.25 today. Many champion minimum wage increases a a way to help the poor. Unfortunately, some get helped while others may lose their job. In the current economic situation, companies are unlikely to raise prices to cover this increase, so they will have to cut costs instead which probably means layoffs. Here is true example of how this worked for Neal Bortz when he was in high school.

"When I was in high school I got a job bagging groceries at the A&P on 9th Ave. in Pensacola, Florida. I was being paid the minimum wage. After a few months on the job the minimum wage went up by 25 cents. The manager of the store fired me. He said that the increase in the minimum wage increased his bag boy budget over the limit, and since I was the last hired I would be the one who had to go."

When Minimum Wage Isn't Minimum Wage

California legislators can't decide on a budget. The Republicans want to cut spending to come up with the $15.2 billion. The Democrats want to increase taxes, specifically on the wealthy. Governor Schwarzenegger's solution? Stop overtime allowing overtime, lay off 22,000 employees, freeze hiring, and drop pay for 200,000 workers from the state minimum wage to the federal minimum wage. The first three are good business sense. The last one, while technically legal by a court ruling (so long as the government makes good on the difference once the budget has been settled) seems highly unfair. For one, it's unfair to the employees who have no control over a legislature that is currently out of session (but being called back for an August 4 vote). Secondly, why can the state of California pay less than state minimum wage when other businesses are required to pay minimum wage. If a private company tried to do this, they would be slapped with fines. Thankfully, the one group that can do something about this, the legislators and their staff, aren't getting a dime of their pay or per diem until they come to a resolution on the budget. More on this here, though it reads as a partisan article.