Minimum wage for US rises to $6.55
WASHINGTON - The national minimum wage is set to increase by 70 cents today to $6.55 an hour, the second of three increases to take place after the wages earned by the nation's poorest and least educated failed to rise for 10 years.
When the richest 20 percent in the country earn more than half of all income earned, the increase is more than due, experts say.
Massachusetts' minimum is $8 per hour.
"It's about as perfect an economic stimulus as you can get. Minimum-wage raises go directly to those who absolutely need to go out and spend it on food and healthcare," said Holly Sklar, director of Business for Shared Prosperity, a network of business owners supporting minimum wages.
US wages have not kept pace with inflation. Taking into account higher prices for food, healthcare, housing, and other necessities, wages are equivalent to those paid 40 years ago.
"It really comes down to what sort of economy are we running here," said John Arensmeyer, founder and chief executive of the Small Business Majority, a national organization of business entrepreneurs.
"It's a moral issue, but it's much more than that; it's an economic issue," he said. "I don't think we should be trying to compete with third world countries on slave wages."
The first of three increases was mandated a year ago.
Next summer, the wage will rise to $7.25, but these increases come as more than half of state governments have raised minimum wages on their own above the federal standard, with a handful tying increases to annual inflation, an important criterion because higher energy, food, and healthcare costs have cut into earnings.
But mandating a federal increase in the minimum wage has its critics.
Many argue that this will hurt small businesses, reduce the number of jobs, and add more of a tax on an economy that is already limping through the worst housing slump to occur since the Great Depression.
Experts on the other side of the fence say there is no evidence that minimum-wage increases lead to job losses. And they emphasize that more wages earned translates into more money spent, helping local economies and small businesses. 