SENATE KO’S WAGE HIKE — FOR NOW

Byline: Joyce Barrett

WASHINGTON — The Senate rejected Democrats’ efforts Tuesday to raise the minimum wage by 90 cents, but supporters of the pay increase said they plan to revive it.
After hours of parliamentary wrangling, the Senate decided to send the proposal, which would raise the hourly wage from $4.25 to $5.15 in annual increases of 45 cents, to the Senate Finance Committee.
Democrats, however, said they plan to continue offering the wage increase as an attachment to other pieces of legislation before the Senate. A minimum wage increase is the centerpiece of organized labor’s legislative agenda this year. President Clinton has embraced the idea.
Discounters adamantly oppose the hike, which they say would force layoffs and shorten hours available to minimum wage workers.
“Clearly this would squeeze out positions and hours,” Morrison Cain, vice president, legal and public affairs for the International Mass Retail Association, said Tuesday. “Hundreds of thousands of workers would be affected either by the loss of hours or their jobs. Also, stores may be closed that are no longer profitable as retailers try to absorb costs.”
Cain said a “ripple affect” could also lead to workers at higher pay levels losing their jobs.
A Congressional Budget Office report released Monday said an increase in the minimum wage could cost the private sector $400 million this year if, as proposed, the 45-cent hike took affect in July. The increase would cost the private sector $2 billion in 1997; $3.7 billion in 1998; $3.3 billion in 1999, and $2.9 billion in 2000, the CBO said.
The report also estimated that from 100,000 to 500,000 jobs would be lost as the wage increased.
IMRA, and other members of a business coalition opposing the hike sent a letter to all 100 members of the Senate Tuesday, claiming the current wage makes it possible for employers to “hire millions of teenagers, entry-level workers and others who need job experience.”
Increasing the minimum wage carries some negatives, the letter said, including higher prices for consumers, fewer hours for some employees and fewer jobs for the people most in need of a boost into the labor force. — Fairchild News Service

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