Times & Democrat (SC) Editorial: Minimum wage increase not bad for business

Times and Democrat (SC) Editorial, 7/31/07

ISSUE: Minimum wage

OUR VIEW: People need more money; business will benefit

A week ago, the minimum wage in the United States increased.

Proponents say the increase was overdue, with inflation having long ago cut into the previous hike.

Sixth District Congressman and U.S. House Majority Whip James E. Clyburn writes that the increase from $5.15 an hour to $7.25 over a two-year period will have real impact in South Carolina, which has among the lowest wages in the nation.

The increase means 179,000 South Carolinians will receive a 70-cent raise. An estimated 325,000 workers will receive a pay increase over the next two years as a result.

"This raise will help 7.4 million women and 3.3 million parents, with about 6 million children seeing their parents' income rise. ... The increase of $2.10 an hour will give families like these an additional $4,400 a year to meet critical needs," Clyburn writes. "That's 15 months of groceries, over two years of health care, 19 months of utilities or 20 months of child care."

Significant!

Opponents will persist in arguing the increase is anti-business, that it will lead to fewer jobs for young people and even mean less money for those in pay brackets just above minimum wage. But even the most ardent foe of an increase cannot deny the reality of the numbers: Last year a full-time minimum wage worker earned about $11,000, which is about $6,000 below the poverty level for a family of three.

Beyond the individual need factor, there is a case to be made that business will not suffer.

Steve Fernlund, founder and president of Generation Three Logistics, a transportation logistics firm in Las Vegas, Nevada, writes:

"Raising the minimum wage is the right thing to do, and not just because it's also the fair thing to do.

"Studies by the Fiscal Policy Institute, a nonpartisan research and education organization, show that in states that have a minimum wage that are higher than the federal minimum wage, the number of small businesses and the number of small business employees grew more and faster than other states.

"If higher minimum wages are good for small business, they're good for America. Small business is the backbone of the American economy.

"Our 25 million small businesses make up 52 percent of the private sector work force. Small businesses create 75 percent of all new jobs and anchor our communities.

"Small business owners know firsthand that higher minimum wages mean more customer spending power. Higher minimum wages mean more productive workers and healthier local economies.

"So it's no wonder that 62 percent of small business owners surveyed nationwide in 2006 by Small Business Majority supported an increase in the federal minimum wage.

"Small business owners from across the nation have signed a statement in support of higher minimum wages at www.businessforafairminimumwage.org which says, "We cannot build a strong 21st century economy on a 1950s' wage floor. We cannot build a strong 21st century economy when more and more hardworking Americans struggle to make ends meet."

"So who are you going to believe? Television and radio talking heads predicting doom and gloom because of a raise in the minimum wage, or those men and women from the small businesses responsible for most of the new jobs in this country? I'll be going with my peers in the business world.''

We'll join him. Hard-working people in this state and around the country deserve to make enough money to be able to afford a modest living. At $7.25 an hour, the minimum wage will not ensure that, but it will certainly improve the situation for a great many South Carolinians while not undermining business.