In 1976, when I took my first job at a Burger King in Kirkwood, the federal minimum wage was $2.20. At the time, I didn’t drive and held no real responsibilities; that was plenty of money. Though I didn’t work full-time, there were employees with families who worked 40 hours per week and heavily relied on those paychecks.
Times have changed, and the minimum wage has continued to climb over the past several decades. Missouri's minimum wage has kept pace with the federal standard, even surpassing it at times.
In 2006, Missourians passed a ballot initiative calling for the state minimum wage to be adjusted in accordance with annual increases in the Consumer Price Index. As a result, the state minimum wage will increase to $7.50 an hour, 15 cents more than the current rate of $7.35. Without taking out any taxes, social security, or health care (if available), 40 hours per week at that rate would be $300, or about $1,200 a month.
This is not a lot of money, especially if one is trying to raise a family on this lone income. But Missouri is among the more progressive states when it comes to the minimum wage. (Note: Only businesses with gross sales of more than $500,000 are mandated to pay minimum wage.)
In recent times, Missouri was one of just 19 states (and the District of Columbia) with a minimum wage higher than the federal standard of $7.25 per hour. Twenty-one states are at the federal minimum-wage level. Arkansas, Georgia, Minnesota, and Wyoming have minimum wage levels below the federal mark. And five Southern states—Alabama, Mississippi, Louisiana, Tennessee and South Carolina—have no minimum wage laws. Thank goodness that Missouri isn't trying to emulate this embarrassing way of doing business.
There is some bad news, though: Last year, Missouri was ranked ninth in the percentage of hourly workers earning the federal minimum wage or below, at 6.3 percent. Missouri could move down the list, which is admirable, because of the new $7.50 minimum wage. The worst five states are Idaho (7.7 percent), Texas (7.5), Oklahoma, (7.2), Louisiana (7.1), and Arkansas (6.9). The best five states are Washington, Montana, California, Oregon, and Alaska; each has less than 2 percent of its workforce working at or below federal minimum wage.
Dan Mehan, president of the Missouri Chamber of Commerce, says his organization opposed the ballot initiative in 2006 and remains against increases in minimum wage. “As the minimum wage increases, the ability of employers to continue to employ workers is damaged—hitting entry-level jobs especially hard,” he said in a written statement. “It causes uncertainty and positions Missouri to raise its minimum wage to uncompetitive levels. We opposed the change to the law in 2006 and maintain that wages should be set by market demand, not bureaucrats.”
I disagree. But I also think the effort to raise minimum wage to double digits in Missouri are misguided and could do more harm than good.
Lara Granich, director of Missouri Jobs with Justice, supports the raise in the minimum wage, saying, “The cost of living adjustment in Missouri’s minimum wage keeps the lowest paid people in our economy from falling further behind.”
But she said the 15 cents increase in 2014 should possibly be four times higher in the St. Louis and Kansas City metropolitan areas. If the minimum wage went up 60 cents, Missouri would be at $7.95—one of the highest minimum wages in the nation.
Commentary by Alvin Reid
