Minimum-wage increase gathers steam in Minnesota

One day after President Obama called for a $9 an hour federal minimum wage in his State of the Union address, efforts to raise the lowest hourly pay allowed in Minnesota are gathering strength.

Gov. Mark Dayton, House Speaker Paul Thissen and Senate Majority Leader Tom Bakk all say it is time for Minnesota to lift the minimum wage, which now stands at $6.15 -- one of only four states with a wage less than the federal minimum.

"We want work to pay," Dayton said Wednesday. "It's long overdue."

House Rep. Melissa Hortman, DFL-Brooklyn Park, and Sen. David Tomassoni, DFL-Chisholm, on Wednesday promoted a bill, introduced last week, that would raise the state's minimum wage to $9.50 an hour and index it to inflation. That bill has drawn the support of House Majority Leader Erin Murphy, DFL-St. Paul, and a host of other DFL committee chairs, though critics say the bill could threaten a still-fragile economic recovery by making workers unaffordable.

Hortman said the increase is needed. "The more you raise the minimum wage, the more people you raise out of poverty," she said. Supporters say that as many as half a million Minnesota jobs pay less than $9.50 an hour.

Thissen, a Minneapolis DFLer, said a minimum wage increase is likely to pass this session. "Among the things that are moving, that probably has a much better chance than many others."

About 93,000 Minnesotans, or about 6 percent of the state's hourly workers, now earn at or below the current minimum wage according to a 2012 report from the Minnesota Department of Labor and Industry. Those making the minimum or less tend to be young, female and from outside the state's biggest cities, the report said.

"Tonight, let's declare that, in the wealthiest nation on Earth, no one who works full time should have to live in poverty -- and raise the federal minimum wage to $9 an hour," he said.

A split along party lines?

That proposal received a frosty reception in the Republican-controlled U.S. House on Wednesday. Republican U.S. Reps. Michele Bachmann, Erik Paulsen and John Kline all oppose the latest proposal.

"The best approach right now for all working Americans is to enact a pro-growth agenda that, first and foremost, gets federal spending under control and government out of the way of our job creators," said Troy Young, a Kline spokesman.

Most Minnesota Democrats in Congress gave Obama's plan full support, including Sen. Amy Klobuchar and Reps. Keith Ellison, Betty McCollum, Rick Nolan and Tim Walz.

Sen. Al Franken, DFL-Minn., co-sponsored a bill last summer to raise the minimum wage to $9.80, but on Wednesday said he wants to review President Obama's proposal before committing support. DFL Rep. Collin Peterson could not be reached for comment, but voted to raise the minimum wage in 2007.

Andrew Feldhamer, a St. Paul bartender, is cheering federal and state proposals.

"We're paycheck-to-paycheck people, and if that paycheck was just a little bit bigger it would make a big difference," said Feldhamer, 34. He and his wife, a server, both earn the minimum wage at full-time restaurant jobs while also attending school full time.

The federal proposal, like the proposals in Minnesota, would add an inflation index to the new wage standard. That means, as time goes on, the minimum wage would rise automatically with inflation. Backers say keeping the minimum wage moving would ensure that low-income workers would not be left behind as goods and services become more expensive. Detractors say it would force employers to scale back their workforces as paying workers becomes unaffordable.

"It may look a little bit benign today but ... who knows where that minimum wage would go five, 10 years from now, if we get into hyper-inflation?" said Mike Hickey, state director for the National Federation of Independent Business. NFIB represents small businesses and joins with other business groups in opposing the proposed wage hikes.

When Democrats controlled the U.S. House and Senate in 2007, Congress passed a bill to raise the minimum wage to $7.25, its current level. With control of Congress now split, the prospects for another hike may be slim, said Thomas Mann, a congressional scholar at the Washington, D.C.-based Brookings Institution.

"It's an article of faith among Republicans that it's a job-killer," said Mark Rom, a political scientist at Georgetown University in Washington, D.C.

Economic studies are mixed about whether raising the minimum wage reduces jobs.

Bakk, the Minnesota Senate leader, gave priority to a bill that would raise Minnesota's minimum to $7.50 an hour.

"I believe it will go up and I believe it will have inflation [index], but I don't know where the number is going to settle," the Cook DFLer said.