Friday, September 16, 2011

It seems odd that Oregon's minimum wage is going up

Next year the minimum wage will be $8.80. That is $18,304 per year. Depending on the size of the household - a minimum wage earner may actually be below the poverty level. But there is value to a minimum wage. See too The real value of Washington’s minimum wage.

While the minimum wage is based not on a state's cost of living index - but the national's, there seems to be a certain unfairness to Oregon's ( it is not well situated economically) businesses, especially the small business. This may be especially true when the general economy is also in such bad shape.

It is not too difficult to argue that small businesses - those that provide the most jobs - will be reluctant to hire employees where their other operating costs are not decreasing, and the ordinary course of passing costs onto consumers is not necessarily an option.

I don't now if it "fair" or not - it does seem unfair to the working person that has a job, but is still living in poverty. Rent, including utilities, transportation, health insurance and food pretty much wipes out $8.80. Admittedly though, a single young person might not do too badly on a minimum wage in a city like Portland. But a couple with children and only one working member - will be dependent on a host of other "social" payments like food stamps.

While an earlier, November 2008, post in my Old Town blog is somewhat dated in the numbers used - I still stand by my view: "Workers ought to be paid a living wage - minimum is just a start - and not a good start at that. The fact that somebody in a better financial position pays more for breakfast [because of a raise in the minimum wage] - tough."

However, any argument over minimum wage is merely a straw man. The real issue is that there is a growing divide between the haves and have-nots and a growing unemployed, but looking, base.

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