State Senate passes Minumum Wage Increase

KELOland news is reporting tonight on today's action in the State Senate, which included the Senate passing Governor Rounds' bill to increase South Dakota's minimum wage:
The state's minimum wage could be going up this summer. Governor Mike Rounds' bill to raise the minimum wage to more than seven dollars an hour by 2009 has passed the Senate.


If passed, Senate Bill 207 would increase the minimum wage to $5.85 an hour this July. It would then go up to $6.55 in 2008 and to $7.25 in 2009.

Republican Senator Dave Knudson from Sioux Falls says, "You look at the time that has passed since the last time we adjusted this and I hope you will agree with the Governor and myself that the time has come to step forward and increase our state minimum wage."


Opponents also think employers should determine how much workers are paid...not the government.

Republican Senator Brock Greenfield from Clark says, "When we go home from session we hear people attacking us for not knowing how it is we should spend the state's money, and now here we are telling some of the smallest businesses among us how they should spend theres."
Read it all here.

What say you the reader? Is it long, long overdue? Or not?


Bob Ellis said…
The government has no right to interfere in a private matter between an employee and his employer.
Anonymous said…
The government has no right to interfere in a private matter between a woman and her doctor.
Aaron Lorenzen said…
I think the members of the Senate and soon the House need to take an economics course. Anyone that has had the slightest bit of instruction in economics would gather the reasons for not raising the minimum wage are aplenty.

This is going to be interesting to see how small businesses across the state and country suffer from this hike.

This is something that sounds good, but that is as far as it goes. It hurts more than it helps.
Anonymous said…
I think one of the industries this may affect the most is food service related (local cafes, convenience marts, etc.). Most other jobs should pay over $7 already with the worker shortage many areas are facing. HOW WILL THIS AFFECT WAITER/WAITRESS PAY?

I have a couple tests I should be studying for, otherwise I would look it up.
Anonymous said…
Ronald Blackwell, the AFL-CIO's chief economist, tells the New York Times that state minimum-wage differences entice companies to shift jobs to lower-wage states. In other words, jobs will come to those states with lower wages.

As demand for labor increases, businesses must increase wages to attract the workers needed. This is laid out quite clearly in Economics 101, which, unfortunately, it appears, most legislators either didn't take or failed miserably.

The minimum wage should be the same everywhere: $0. Labor is a commodity and goverments don't fair well when they set the prices of commodities.

Why stop at $7.25? Is there something magical about that figure. Which dark, warm, moist place did they pull that one out of? Let's give everyone $50.00/hour and we can all party all night long.
Haggs said…
Thank God the Governor and Senate are not listening to the people who, for some reason, don't want to raise the minimum wage.
Aaron Lorenzen said…
Haggs, people and obviously legislators are ignorant.

This is an issue that will hurt more than it will help, give me some reasons why it is beneficial to the people AND the economy? I am sure all you can come up with is that it pays people that work minimum wage more so they can afford more stuff.

Well this is great, but realize this, as soon as companies must pay more for labor they must compensate somewhere, and that will be in the product end, thus making products more expensive, and everything is exactly the same.
Anonymous said…
What can you expect from a lawyer and an insurance salesman.
Anonymous said…
It will hurt small business. The national level is talking or has been talking about the same thing. The balance is not there.
If small businesses are faced with more cost they will let go of employees, raise prices, decrease quality and there are other posibilities that will come with the raising of the min. wage. It will put some smaller businesses out of business.
Does anyone think it possible that the flux in both directions has anything to do with the dot com era? The econ did boom during that time and i think we are still seeing the effect.
Just a thought off the top of my head, and I do feel other factors do come into play here.
Anonymous said…
How about a minimum wage for state bureaucrats.
Anonymous said…
Yes, Very minimum.
Elais said…
I had thought it was an open secret that if a large business wants to relocate here, the state forces the business to keep their wages artificially low. Do they do that to protect small businesses?

Just how much 'protection' does small business need? Is this state a welfare state when it comes to small businesses? What constitutes a small business? 1, 10, 100 employees?
Haggs said…
"Ignorant" is a strong word there, Aaron.

I'm more of a right-brained person and I suck at math. So I leave things like economics up to others to figure out. But even with my little knowledge, I imagine that there will be cases where increasing the minimum wage will hurt businesses. But I still don't see that as a reason to oppose the increase.

This isn't the first time they've increased the minimum wage. I bet that people had similar discussions when it happened before. And I also imagine that some businesses were hurt by those previous increases. But still, the increases went forward.

I was in high school when the last increase happened (it was in the 90's right?), so I have no idea about how it impacted businesses. But there are still small businesses and they still hire people. From my "ignorant" perspective, things seem to have worked out okay since then.

So I see nothing wrong with trying it again.
Mom said…
FIRST our country must secure our borders!
If there are jobs that "no American will do" then someone will have to raise the wage to get someone who will do it.
There used to be MANY women who went into nursing--as more professions opened to women and women looked at the wages of nurses--they stopped going to nursing school. There are now FAR fewer nurses (and more elderly needing care)-- wages had to increase to keep enough nurses working. This is why health care and insurance have become more expensive.
Secure the borders and wages will take care of themselves.

Bob ellis--"The government has no right to interfere in a private matter between an employee and his employer"--unless it involves killing or murdering someone.

Anon 9:27 PM "The government has no right to interfere in a private matter between a woman and her doctor"--unless it involves killing or murdering someone.
Anonymous said…
People who don't want others to make a living wage are just exercising a socially acceptable form of aggression against other people. How can you feel superior if your not oppressing these other people to make your status look a little better. The real motivation behind wanting to not have a min wage hike is selfish aggressive desires to screw your fellow humans.
We hiked the minimum wage in the 90's and prices didn't suddenly go through the roof. Businesses didn't suddenly shut their doors. The small business excuse is just that, an excuse to cover someone's less than noble motives to make themselves feel superior in their pathetic lives.

The reason they force incoming businesses in the state to pay less is to protect the other large businesses in the state. They don't want someone coming in here and paying $5 more an hour than the other cubicle farms. That would upset the ones already here. Our state and city officials have shut the door on large businesses who wanted to come here and would not drop their standard wages.
Anonymous said…
If it's so great to set a "minimum wage", why not set a "maximum wage"? People could make it on 5.15 an hour if their insurance,rent, gasoline, health care, legal costs, etc. weren't so high. Lawyers,doctors, ceo's, union goons and many others are making way more than the lower/middle class can afford to bear,that is why the economy is out of whack, not because someone is making too little!
Anonymous said…
Bob & Mom - I never cease to be amazed that you people can be indignant about government interferring in "private" matters like minimum wage and yet you have no problem with government dictating to a woman what she can and cannot do with her body.

Making decisions about your own body - it doesn't get any more private than that!
Anonymous said…
Hey, maybe a hike in the minimum wage will shut up some of the people who are whining about Sanford's biggie donation in Sioux Falls. They are saying that high-paid jobs that will come as a result are going to hurt the lower-wage people because the housing market, etc. will be skewed.
Anonymous said…
I feel sorry for the young people who would otherwise get hired to gain some experience. Any person who paid attention during Econ 101 knows raising the minumum wage hurts the young kids trying to get a job to gain experience.

Why are unions so in favor of raising the minumum wage? Follow the money, they get a pay increase.

McDonalds in this town is paying $8 hour. Let the market set the wages.

If raising the minumum wage was the cure all why not raise it to $15 hour. Because it hurts the new hires and young inexperienced worker thats why!
sdmoderate said…
I'd be willing to be those that don't see the need to raise the minimum wage have never tried to live on it...
Crazy Dawg said…
Shantel Krebs can't support a pay raise for the worst paid South Dakotans, but she's willing to overlook an obvious legal conflict of interest for her husband Mitch to make a rock star salary of $105,000 to write silly press releases. She's a phony.

For that kind of bread, Marion could hire three people at $35,000 a year to generate useless, self-promoting press releases and blizzard the media offices around the state. And I'll be he could insist they actually live in Pierre rather than commute as part-time help.

Mitch hit the jackpot. "Thanks Governor Rounds for my job!"
veritas said…
sdmoderate, have you heard of inflation? In the long run, raising the minimum wage will only serve to increas the cost of goods and services. It establishes a new baseline to which buying power is compared. In a matter of a few years a job paying $7.25/hr will have the same purchasing power as a job paying $5.50/hr does today.

In the end, this is not about helping the little guy or balancing the economy. This is politics plain and simple. The governor is hedging his bets here. He wants to be able to claim he raised the minimum wage first just in case he ends up running against Stephanie next year.
Anonymous said…
Just the other day, there was an article in the Arizona Republic. In the article, it talked about the effects of raising the minimum wage. The effects were not theoretical, they were what happened because of Arizona raising the minimum wage. As the theory goes, so did the reality. Kids lost jobs. Business owners were forced to make workers do more. They also had to raise prices. They had hiring freezes. So what was the benefit?
SDModerate, you are right. I do not have to live on minimum wage. Guess what! Neither do my two working sons. They used to earn minimum wage, but after getting experience, they started making more. Very few families live on minimum wage. For the most part, minimum wage earners are kids. Oh, and when I did not earn much above minimum wage, I got the training I needed to change my situation.
Anonymous said…
Veritas-SLAM DUNK COMMENT! Right on, and I cant believe it took this long to get to it! Hopefully only those who have taken, at minimum, one course of college economics should be discussing this topic...There is some serious ignorance being depicted by those who think the minimum wage is some kind of saving grace to our society:> Think about it, or at least support your comments.

The power of economics works in our state, as I believe very few employees work for minimum wage. The economy and competition drives wages, not gov't mandates. This is proven by many, if not most jobs are above minimum wage, and many are still not filled. Yes it hurts the kids, and yes, the unions are on board because of salary contracts that ALL positions raise the same amt when any position, $34/hr employee goes up to $35/hr when minimum wage goes up $1/hr. Research the topic, and you can easily see the impact it has on the economy...and its not a bunch of people living happier because min wage went up!
Anonymous said…
it only passed due to the fact that nationally it will also pass.
so it will make no difference on if pass as a state or not
sdmoderate said…
Veritas, yes I have heard of inflation and my question to you is how much has inflation increased in the 10 years or so since minimum wage was last increased? You can't blame that on a minimum wage increase. Using your logic, nobody should get a raise because it will cause an increase in inflation.

Using the argument that it mainly affects high schools students for the most point doesn't fly either. Maybe it's been awhile since many of you were in high school but I remember trying to pay car insurance and at the same time trying to save for college. How much have those costs risen since the last increase?

Everyone deserves a decent wage for services performed and in a perfect world employers would provide that but unfortunately that isn't the case, hence the need for the minimum wage in the first place. If a business that relies mainly on minimum wage labor can't afford to pay a few dollars more in wages than it may be time to look in the mirror for the reason why.
lexrex said…
"If a business that relies mainly on minimum wage labor can't afford to pay a few dollars more in wages than it may be time to look in the mirror for the reason why. than it may be time to look in the mirror for the reason why."

what are you getting at sdmoderate? little soundbites like that might sound good, but it doesn't answer the question or problem you pose.

If a business that relies mainly on minimum wage labor can't afford to pay a few dollars more in wages, then what would you have that business owner do? no rhetoric. what's your real-world answer?
Anonymous said…
"Using your logic, nobody should get a raise because it will cause an increase in inflation."

No, sdmoderate! The logic is that people should get pay raises based on merits, productivity, and value to the company...not because the government says so.

People that would be affected by this (those working below the proposed minimum wage) are earning what they are worth according to supply and demand. Someone wanting to improve their lot needs to find ways to become more productive and valuable in order to demand a higher wage.

Government mandated higher wages lead to job loss. Someone working at minimum-wage-paying job may see reason to celebrate when they hear the minimum is being increased. However, they won't be celebrating when the boss calls the next morning and says he has to cut down the labor force because he can't afford to pay as many people and lo and behold you are out of a job.

90-95% of economists are in agreement that a minimum wage is bad. Maybe we should listen.
Anonymous said…
The more people make, they better lives they're going to have and the better consumers they're going to be. It's going to provide better jobs and better wages.
Anonymous said…
Wrong! They can't be better consumers when there is price inflation. The real wage (nominal wage/price level) will not change. Thus, those who benefit from a higher minimum wage end up being none-the-better.

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