California's minimum wage increase drives up prices

[Regis Philbin]

http://recordnet.com/apps/pbcs.dll/article?AID=/20061217/A_BIZ/612170301

State minimum wage increase to drive up prices

California raises wage for first time in five years



By Joe Goldeen
Record Staff Writer
December 17, 2006 6:00 AM

STOCKTON - Enjoy the sales this holiday season, because starting Jan. 1, California businesses that pay minimum wages or thereabouts say they have no choice but to raise prices on everything from pepperoni pizza to dry cleaning to a sack of potting soil.

For the first time in five years, California's minimum hourly wage will increase.

Since 2002, it's been $6.75, but starting Jan. 1 it will rise 75 cents an hour to $7.50, an 11.1 percent increase.

"We have to raise prices," east Stockton dry cleaner Nubia Vargas said.

"My customers, I don't think they will understand. They think it's already expensive," said Vargas, owner of Snow White Cleaners at 3408 E. Main St.

To launder and press a shirt, Vargas charges $2.25. She's already anticipating having to raise that price to $2.50 after Jan. 1. For dry cleaning, she expects to add 50 cents to the current $3.50 charge.

The reason: She pays her presser $9 an hour, and will increase his pay at least $1 after the 1st. "He's real good," Vargas said. Also, she will raise the pay of her night presser from $7 - 25 cents over minimum - to $7.75, to keep it consistent with the state-mandated increase.

[Richard Tafoya]

Next graf:

Vargas admitted her prices are already a little higher than some competitors, but she offers free pickup and delivery and needs to compensate for other rising expenses.

And later in the story:

Longtime Stockton restaurateur owner George Badway, director emeritus of the California Restaurant Association, said the increase is long overdue.

...

His entire staff will see raises next year to maintain the margin above minimum wage.

"That's one of the critical secrets to our success. Paying our people a living wage, as much as we can pay them, provides a better product, better service and a better staff. We pay a lot more to our staff than other restaurants, and we've been rewarded by it," Badway said.

And some perspective from the Chicago Sun-Times in regards to Illinois' own minimum wage increase:
http://www.suntimes.com/news/martire/148878,CST-EDT-MART25.article

After-tax corporate profits more than doubled since 2000. Yet, for most workers (the bottom 80 percent), inflation-adjusted wages have declined. Commerce Department figures show the decline was so steep that, in the first quarter of 2006 wages and salaries collectively accounted for only 45 percent of the nation's Gross Domestic Product -- an all-time low, and down from 50 percent as recently as 2001.

All that economic growth had to go somewhere. If the overwhelming majority of Americans were left out, who gained? Really rich people, that's who. According to a Wall Street Journal analysis of U.S. Census data, the share of income growth going to America's wealthiest families set a new high in 2005. Instead of all boats, today a rising tide apparently lifts only yachts. Anyone below the yacht-income class better be good at bailing water.

[DoubleEdgeSword]

We're doing great in Florida. *waves*


FIU: No negative effects from minimum wage ordinance

Predictions a higher minimum wage would raise unemployment and accelerate inflation in Florida have failed to materialize a year after the new minimum wage went into effect, a study has reported.

The study, carried out by University of Chicago and Florida International University researchers, looked at figures from the U.S. Bureau of Labor Statistics and the Florida Agency for Workforce Innovation, among others.


The researchers concentrated on predictions the $6.15 minimum - $1 above the federal minimum wage - would hurt the tourism industry and raise the state's unemployment rate.

"The numbers speak for themselves," said Bruce Nissen, one of the study's investigators and the director of FIU's Research Institute on Social and Economic Policy. "Most figures indicate the state's economy is doing great and many of the industries that rely on minimum wage labor are doing great, as well."

Nissen points to Florida's unemployment rate as an example. FIU said the indicator is impacted directly by changes in wages, yet is one of the lowest in the nation.



http://southflorida.bizjournals.com/southflorida/stories/2006/05/01/daily29.html

[WannaBreatheYou]

Amazing that we've been at $7.35 for quite awhile in Washington (at least 2 years that I know of) and have no problem with it. Imagine that.

[LesterX]

Regis, do you have any freakin' clue how expensive it is to live in most parts of California? God forbid we pay a living wage to people. I guess you'd rather see the working poor unable to provide for their families than risk paying more for your pizza.

I know -- how about we return to the days of slavery? We won't need no stinkin' minimum wage then -- as long as people are housed, fed and clothed, it will work out great and will be cheaper for us all. What do you think, Regis?

[Annoyedlistner]

Regis, do you have any freakin' clue how expensive it is to live in most parts of California? God forbid we pay a living wage to people. I guess you'd rather see the working poor unable to provide for their families than risk paying more for your pizza.

I know -- how about we return to the days of slavery? We won't need no stinkin' minimum wage then -- as long as people are housed, fed and clothed, it will work out great and will be cheaper for us all. What do you think, Regis?

Regis doesnt care about anyone but himself....he could careless if someone works their tails off and only make $4.50 an hour...as long his pockets keep getting lined...he doesnt give a crap about anyone else.

[SparkleHugs]

I already pay 3.50 for my dry cleaning and thats before the raise, it isnt an outlandish price. When it comes down to it MOST employers aren't going to change their wages to accodate the change. When it went up back in 2002 I remember talking to my friend who had gotten a raise before the wage change, but after it change she went back down to minimum wage because of the mandated raise. Most places will do this.

and Lester has a very valid point, it is extremely expensive here compared to wherever Regis' mothers basement is.

Oh and our gas just jumped 8 cents overnight again.

[shining star]

When you have to pay $1000 a month for a one bedroom in the 'ghetto' area of town, it's pretty bad. A 75 cent minimum wage increase isn't much, but it will help some people.

[SparkleHugs]

exactly, living on minumum wage here wont even pay for an apartment, you cannot be autonomous and live on minimum wage here, I was working 2 jobs, together working about 50 hours a week one making 775 another making 850 and I could bearly make ends meet...and that was living with my parents. The cost of living here is insane.

[lost_n_justin's_smile]

Ohio just passed a minimum wage increase from $5.15 to $6.85 and people are already whining about how it will affect the economy. I mean, God forbid people in lower wage jobs be able to provide for their families. What a concept