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Lawmakers Try to Agree on MN Minimum Wage Hike

PHOTO: The question is no longer whether Minnesota will increase the minimum wage, but how much. A conference committee is trying to reconcile a Senate proposal of $7.75 and a House proposal for $9.50 an hour. CREDIT: J. Wynia
PHOTO: The question is no longer whether Minnesota will increase the minimum wage, but how much. A conference committee is trying to reconcile a Senate proposal of $7.75 and a House proposal for $9.50 an hour. CREDIT: J. Wynia
May 15, 2013

ST. PAUL, Minn. - A raise in the minimum wage is coming to Minnesota, but just how much still needs to be determined as Monday's legislative deadline to adjourn approaches.

The Senate voted to increase the minimum to $7.75 by 2015. The House bill would increase the minimum to $9.50 in that time frame.

"I think the House has a better approach to the issue because it restores more of the purchasing power that's been lost over the years," said Brian Rusche, executive director of the Joint Religious Legislative Coalition. "In fact, if the minimum wage had kept pace with the purchasing power that it had in the early 1970s, it would be over $10.50 an hour."

Gov. Mark Dayton also has said he prefers the higher minimum wage hike plan. Republicans say businesses will have to cut jobs if the minimum is raised, which will have a negative impact on the economy.

Research shows hiking the rate could have a positive economic impact, Rusche said, as the additional wages for lower-income earners are spent immediately and locally and the businesses that employ them end up with a more stable workforce.

"When people are paid adequately, businesses don't experience as much turnover and they have lower training costs," he said. "So, some academic studies have shown that it's actually a positive employment effect."

In addition to how much to increase the wage, the conference committee also must decide whether to tie future increases in the minimum wage to the cost of living.

"I don't think workers should have a long lag between minimum-wage increases," he said. "If the Consumer Price Index goes up, then it would be great if the minimum wage were to follow proportionately."

Under current Minnesota law, the minimum wage for large employers is $6.15 an hour - among the lowest in the nation - although most are required to pay $7.25 an hour, which is the federal minimum.

More information is online at revisor.mn.gov.

John Michaelson, Public News Service - MN