Originally created 08/08/06

Leaders deride impact of raise



COLUMBIA - Congress' proposed minimum wage increase of $2.10 wouldn't do much to solve South Carolinians' economic woes, politicians and experts say.

"If solving wage problems was as simple as government stepping in saying, 'You get 'x' number of dollars versus 'y' number of dollars,' wage problems for a lot of people would have been solved a long time ago," Gov. Mark Sanford said.

Senate Democrats support a proposal to raise the minimum wage from $5.15 to $7.25 an hour over the next three years, but squelched the plan this month because Republicans tied it to a proposed cut in the estate tax. South Carolina Republican Sens. Lindsey Graham and Jim DeMint approved of the legislation. The House passed the plan two weekends ago.

"Funding a minimum-wage hike by draining $800 billion from public budgets used to fund programs like Social Security and Medicare is not a solution for low-income Americans," said Gerald McEntee, the president of the American Federation of State, County and Municipal Employees. "It is a new problem. Congress owes it to all low-wage workers to raise the minimum wage with no strings attached."

The federal minimum wage hasn't gone up in nine years. And, at this point, it's so low that most hourly jobs pay more than $5.15 already, said Kin Blackburn, an economics professor at the University of South Carolina.

Using 2004 employment numbers, researchers at the Center for Economic and Policy Research estimated in December that raising the minimum wage to $7.25 would affect 150,000 workers in South Carolina; the average increase, though, would be 77 cents an hour.

A minimum-wage worker makes $10,712 a year - below the poverty level for families of two or more people.

Critics say that most of those workers are teens, part-timers or single anyway and that any increase adds to employers' cost, forcing layoffs or fewer hires, ultimately increasing unemployment.

The state's unemployment rate of 6.7 percent already was second-highest in the nation in June.

Mr. Blackburn said so few employers are paying the minimum wage now, however, that the raise would be fairly insignificant for business owners, too.