Proposed Law Sets Minimum Wage Increase in Oregon

Brad Avakian, Oregon Labor Commissioner, is scheduled to appear at a hearing before the state legislature to consider a proposed law that may boost the federal minimum wage from the current $7.25 an hour to $10.10 by 2015.

The move comes amid growing calls to act on an across-the-board wage rate adjustment. President Barack Obama endorsed an increase in his State of the Union address. Many in Congress, including Oregon Sen. Jeff Merkley have backed the proposal. Yet even before debate started, the issue had triggered volatile responses from some Republicans and business leaders who say that pushing the rate higher will dampen economic growth and stall the recent surge in job growth.

Avakian said that Oregon’s law is guided by the understanding that increasing workers’ purchasing power leads to a healthier economy and that the price on goods and services will increase with inflation.

He further testified that by indexing the minimum wage to inflation, the proponents made sure that workers do not lose ground as the costs of everyday goods increase. The system also provides employers with greater certainty and predictability for payroll expenses over time.

However, critics noted that the policy works in only one direction, and that the wage does not decline when inflation and the economy recede.

House Speaker John Boehner, who is resolute in opposing the increase, said that when the price of employment is increased, the more one gets less of it. By increasing wage, it is harder for small employers to hire people, he added.

Read full story at: Brad Avakian to tout Oregon’s success raising the minimum wage