Monday, June 30, 2008 s j '
The Michigan Daily - michigandaily.com :.4 . 3
MINIMUM WagE
Wage hike won a ec nn rbo
Pay minimum raised
to $7.40 per hour
By LINDY STEVENS
Daily News Editor
Recent LSA graduate Polina
Arsentyeva will see an extra $10 in
her usual paycheck from Stucchi's
after a state-wide minimum wage
hike takes effect tomorrow, but
Arsentyeva said the few additional
dollars won't matter much to her.
"I don't think it's going to make
that much of a difference, but maybe
I just don't know because I'm not in
a situation where I need the money
to survive," said Arsentyeva, who
hasplansto keep scoopingice cream
until she starts law school at Loyola
University in the fall.
"It's basically just so I don't
mooch off of my parents while
I'm in Ann Arbor," she said.
Starting Tuesday, employ-
ees working for minimum
wage throughout the state will
make $7.40 an hour - a 25-cent
increase over the state's current
$7.15 minimum hourly rate.
Though the increase is a wel-
come addition for some of Mich-
igan's lowest wage earners, the
majority of workers probably
won't feel the direct impact of
this state-mandated increase.
According to the U.S. Depart-
ment of Labor, just 2.2 percent of
Michigan's approximately 3 mil-
lion hourly wageworkers were
paid minimum wage in 2007.
For those 58,000 workers, the
latest wage hike represents the
last of three annual increases
to the state's minimum wage
rate. The three-part boost was
passed by the state legislature
and signed into law by Gov. Jen-
nifer Granholm in March 2006.
The first segment increased
minimum wage from $5.15 to
$6.95 in October 2006. The sec-
ond increase brought the state
up to its current $7.15 minimum
in July 2007.
Though Mayor John Hieftje
said he welcomed the recent
wage hike, he said its effect on
Ann Arbor would likely be mini-
mal.
"I doubt if it will have much
of an impact at all," Hieftje
said. "This is not a significant
increase, but people working at
the minimum wage need all the
help they can get."
Although Michigan will rank
seventh compared to other states'
hourly minimum wage on Tuesday,
Hieftje said Ann Arbor's own liv-
ing wage was put in place in 2000
to help people earn enough money
to live in the community.
The current minimum living
wage for an employee in Ann Arbor
with health care benefits is
$10.33 per hour. For an employ-
ee who does not receive health
benefits, the city requires a liv-
ing wage of $11.96 per hour.
The living wage doesn't apply
to University jobs. Dave Reid,
spokesman for the University's
Human Resources Depart-
ment, said the effect of a mini-
mum wage change on campus
employment is also likely to be
insignificant.
"I don't know that we know
the dollar-for-dollar impact, but
it's been expected and known and
we've planned for this change,"
Reid said.
Though less opportunity for new
employment after a wage increase
was a concern for some Michigan
lawmakers, Jack Finn, director of
the Wage & Hour division for the
Michigan Department of Labor and
Economic Growth, said a change in
the minimum wage won't decrease
the number of available jobs.
"It's almost like an urban legend
that a minimum-wage increase
leads to a loss of jobs," Finn said.
"It's just not factual."
Although some employers will
have to pay their workers more,
Finn said employees will generally
spend the extra money in the com-
munity, which will increase profits
for most local businesses. He said
employers, particularly single-
business owners, could potentially
pass their extra labor costs on to
consumers by raising their prices.
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