This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Obama, Business Groups Differ On Minimum Wage Plan

Yet that study has come under fire from other economists, who argue that comparing different states over time shows that raising the minimum wage hurts job growth.

Mark Zandi, chief economist at Moody's Analytics, said a higher minimum wage would boost incomes for some poorer workers. But it would also discourage employers from hiring more of them.

"So on net, I am not sure it helps," he said.

William Dunkelberg, chief economist for the National Federation of Independent Business, said the increase would hit businesses hard and only hurt low-wage workers by reducing demand for their services.

"The higher the price of anything, the less that will be taken, and this includes labor," Dunkelberg said. "Raising the cost of labor raises the incentive for employers to find ways to use less labor."

The government first set a minimum wage during the Great Depression in 1938. It has been raised 22 times since then â¿¿ the last increase went into effect in 2009 â¿¿ but the value has eroded over time due to inflation.

Obama's latest plan would raise the hourly minimum to $9 by 2015 and as well as increase the minimum wage for tipped workers, which has not gone up for more than two decades.

As for states that have already set minimum wages above the federal rate, they range from $7.35 in Missouri to the high of $9.19 in Washington. In 10 of those states â¿¿ Arizona, Colorado, Florida, Missouri, Montana, Nevada, Ohio, Oregon, Vermont and Washington â¿¿ the minimum wage is automatically adjusted every year to keep pace with the rising cost of living.

Women represent nearly two-thirds of minimum-wage workers, while black and Hispanic workers represent a higher share of the minimum-wage workforce than whites, according to the Economic Policy Institute.

The last federal minimum wage increase was signed into law by President George W. Bush, when it increased from $5.15 to $7.25 in a three-step process between 2007 and 2009.

2 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Submit an article to us!
SYM TRADE IT LAST %CHG

Markets

DOW 18,024.06 +183.54 1.03%
S&P 500 2,108.29 +22.78 1.09%
NASDAQ 5,005.3910 +63.9670 1.29%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs