SalemNews.com, Salem, MA

Business

June 26, 2013

Waging debate

Business owners fear effects of minimum wage hike

(Continued)

By 2016, the minimum wage would be adjusted for inflation.

The minimum wage for waitstaff would also go up. It’s $2.63 an hour for those who receive more than $20 a month in tips. The law says the wage with tips must be equal to the minimum wage. Under the bill, those depending on tips would receive at least 70 percent of the minimum wage, which would be $6.30 an hour at the $9 an hour rate.

But there is a lot of controversy about whether a higher minimum wage is a good idea. Many business people, like the Baccis, oppose it because it raises their costs. Advocates for the poor have been pressing for it as a way to help those at the bottom of the economic ladder. Economists are split, some saying it will hurt the economy, and others saying it will help.

State Sen. Joan Lovely, D-Salem, said she has not signed onto Pacheco’s bill because she is waiting to hear more debate about it. But she’s leaning in favor of some kind of increase.

“I am in favor of increasing the minimum wage for a variety of reasons,” Lovely said. One of her main reasons is that the minimum wage is so low that people who are out of work often prefer to stay on public assistance rather than work for minimum wage and make less money.

“If the numbers don’t add up, then the fallback is to go on public assistance and not go to work,” said Lovely, who wants even low-wage workers to earn enough to live on.

On the other hand, she said a couple of businesses have called her to tell her: “‘Don’t touch it, we can’t afford it.’”

Kevin Beckwith, an assistant economics professor at Salem State University, said there’s a debate among economists as to whether there should even be a minimum wage — whether the free market should be the one to dictate wages or the government should prop up the wages of unskilled workers to keep up with inflation. There’s debate about whether raising the minimum wage puts more money in low-wage earners’ pockets at the expense of companies pulling back on hiring, thus creating more unemployment.

Text Only | Photo Reprints
Business

AP Video
Six Indicted in StubHub Hacking Scheme Trump: DC Hotel Will Be Among World's Best AP Review: Amazon Fire Adds Spark to Smartphones All Aboard! LIRR Strike Averted Microsoft to Cut Up to 18,000 Jobs Time Warner Rejects Murdoch's Takeover Bid Yellen Says Economy Still Needs Fed Support Cleveland Expects Economic Boom From Lebron Justice Dept. Fines Citigroup $7 Billion Justice Dept. Fines Citigroup $7 Billion Downside of Low Mortgage Rates? Less Selling Cupcake Shop Crumbs Shuttering All Its Stores San Francisco Prepares for Soda Battle Dow Breaks Record 17,000 GM Crash Compensation Could Top $1 Billion GM Won't Limit Crash Compensation Funds
NDN Video
GMA: Dog passes out from excitment to see owner "The Hunger Games: Mockingjay – Part 1" Trailer is Here! Chapter Two: Designing for Naomi Watts Baseball Hall of Famers Inducted Florida Keys Webcam Captures Turtles Hatching Morgan Freeman Sucks Down Helium on 'Tonight Show' Robin Wright Can Dance! (WATCH) She's Back! See Paris Hilton's New Carl's Jr. Ad Big Weekend For Atlanta Braves In Cooperstown - @TheBuzzeronFox Chapter Two: Becoming a first-time director What's Got Jack Black Freaking Out at Comic-Con? Doctors Remove 232 Teeth From Teen's Mouth Bradley Cooper Explains His Voice in 'Guardians of the Galaxy' Deja vu: Another NYPD officer choke-holding a suspect 'Fifty Shades of Grey': Watch the Super Sexy First Trailer Now! Reports: Ravens RB Ray Rice Suspended For 1st 2 Games Of The Season Air Algerie plane with 119 on board missing over Mali Diamond Stone, Malik Newman, Josh Jackson and others showcase talent Free Arturo - The World's Saddest Polar Bear A Look Back at Batman On Film Through The Years
Comments Trcker