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Minimum wage rises to $6.55 per hour

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By RICHARD PIERSOL / Lincoln Journal Star

Thursday, Jul 24, 2008 - 12:24:19 am CDT

The federal minimum wage rises today from $5.85 to $6.55 per hour, the second of three annual steps up to $7.25.

The grumbling among some business interests and economists has resumed as advocates for the poor ask for more.

In Nebraska, the change will apply to a few thousand people, about 0.5 percent of hourly wage earners, who are paid the minimum.

Related Link(s):


Characteristics of Minimum Wage Workers, 2007
Graphic: Minimum wage vs. the consumer price index
Lowest-paying jobs

Here are the Nebraska industries with the 10 lowest-paying, entry-level positions, according to the latest data from Nebraska Workforce Development:
  • Motion picture and sound recording: $6.50
  • Food service and drinking places: $6.55
  • Gasoline stations: $6.55
  • Amusement, gambling and recreation industries: $6.60
  • Accommodation: $6.60
  • Food and beverage stores: $6.60
  • Sporting goods, hobby, book and music stores: $6.60
  • Other information services: $6.70
  • Clothing and clothing accessories stores: $6.70
  • Religious, grantmaking, civic, professional and similar organizations: $6.75
Minimum wage history

The federal minimum wage was created by the Fair Labor Standards Act in 1938, but it generally only applied to workers engaged in interstate commerce. Amendments in 1961 and 1966 added other classes of workers, though for some periods at lower wage rates. It wasn’t until 1978 that a single minimum wage applied to all classes of workers except those in exempted classes.
  • 1938: $0.25
  • 1939: $0.30
  • 1945: $0.40
  • 1950: $0.75
  • 1956: $1.00
  • 1961: $1.15
  • 1963: $1.25
  • 1967: $1.40
  • 1968: $1.60
  • 1974: $2.00
  • 1975: $2.10
  • 1976: $2.30
  • 1978: $2.65
  • 1979: $2.90
  • 1980: $3.10
  • 1981: $3.35
  • 1990: $3.80
  • 1991: $4.25
  • 1996: $4.75
  • 1997: $5.15
  • 2007: $5.85
  • 2008: $6.55
  • 2009: $7.25
Source: U.S. Department of Labor

The Let Justice Roll Living Wage Campaign is calling for a minimum wage of $10 in 2010 as “the least we can do to make up lost ground and bring the minimum wage closer to an adequate living standard.”

But some continue to argue the minimum wage is counterproductive, that employers are likely to cut the number of people they employ as they are forced to pay higher wages.

A new study to be published this fall by Joseph Sabia at the University of Georgia and Richard Burkhauser of Cornell University analyzed the effects of the 2005-06 increase in New York state’s minimum wage and found that the employment decline among vulnerable groups, such as teenagers and adults without a high school diploma, was substantial.

Philip Baker, administrator of labor market information at Nebraska Workforce Development,  hadn’t seen that study.

“I can say that July 24, 2007, when the minimum wage went to $5.85, we did not see the unemployment rate rise,” Baker said in an e-mail. “It will take awhile to see if there is an effect and by a while I mean at least a year.

“The problem with trying to do it this year is the current state of the economy. … Increased fuel costs, the housing market, food prices all are hitting the economy at the same time as the minimum wage increases.

“It will be tough to isolate minimum wage as the issue,” Baker said.

The state’s Occupational Employment Survey shows the average statewide entry wage for all industries is $8.50. For metropolitan areas, it is $8.70, and the non-metropolitan area is $7.65 per hour, Baker said.

“This would indicate that many employers are already paying more than the $6.55,” he said. “Based on the current information, the non-metropolitan area will be affected more. How much it is hard to say.”

A quick survey of job openings at the state’s Workforce Development sites showed a variety of what appear to be entry-level jobs offering more than the minimum wage. Some in manufacturing were double or triple minimum wage, said Ruth Liedle, business services supervisor at Nebraska Workforce Development.

On Wednesday, there were 309 job orders offering from 600 to 900 positions above $6.55, she said.

Security guard, $8 an hour.   Desk clerk, $7.50. Retail sales, $10.25, plus $2.50 more on weekends. Brick tender, $10.50.

Federally gathered labor statistics show that of 553,000 Nebraskans getting paid by the hour in 2007, 3,000 were at minimum wage, and 14,000 were below that, under a variety of exemptions, including agriculture, babysitters, apprentices, people in vocational rehabilitation programs and people employed by their family.

Federal law also allows for a training wage of 75 percent of the minimum for people younger than 20 during the first 90 days of employment.

The 3,000 people at minimum wage are just 0.5 percent of the hourly-paid labor force, the data show.

That number of Nebraskans working at the minimum wage is virtually unchanged from 2005, when there were 3,000 among 549,000 total hourly-paid workers, according to the Bureau of Labor Statistics.

But the number of those making less than the minimum wage is up 2,000 from the 2005 statistics.

Nationally, in 1980, about 15 percent of all workers were at or below the minimum wage. By 2005, that number had dropped to less than 2 percent. As of last year, it was up to 2.3 percent.

According to Nebraska Workforce Development, the motion picture and sound recording industry is the lowest-paying industry in the state, which, at $6.50, has the lowest entry-level average pay, and below what the minimum wage is as of today.

That means the people selling you a ticket and popcorn are probably making less per hour than you are paying for the ticket.

A year ago, a Douglas Theatres spokesman said the 2008 and 2009 legs of the latest rise in the minimum wage made higher admission prices and job cuts a real possibility.

This year, a spokesman for Marcus Theatres, which bought the Douglas Theatres, had little to say about the rise in the minimum wage.

“Our managers will manage their theaters in ways that will provide excellent guest service while minimizing the impact of rising wages,” said spokesman Carlo Petrick, in an e-mail.

Reach Richard Piersol at 473-7241 or dpiersol@journalstar.com.


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Neo wrote on July 24, 2008 7:12 am:
" As the article points out, the people selling you movie tickets and popcorn are affected by this increase. Every movie ticket and bucket of popcorn I bought was sold to me by high school students. The original purpose of the minimum wage law was not to increase the wages of high school students.

This is just an example of politicians doing something because it sounds good regardless of the actual impact. "

 lw wrote on July 24, 2008 7:47 am:
" thats great that minimum wage has gone up for the hourly wage people but what about the waitress do employer still only have to pay them $2.15 an hour or does there wage go up to the rising cost sffects the tips and they are supose to make up the diffrents in tips or were they forgotten with the new wage. "

 scott wrote on July 24, 2008 8:13 am:
" I find it interesting that Douglas Theaters, a company that claims it could not pay employees a decent wage, was sold for $40.5 million. It seems the owners were doing quite well. "

 beerorkid wrote on July 24, 2008 8:20 am:
" Would just like to point out that the image uses on the front page for this story shows a tipped employee (server) who will see no rise in the $2.13 per hour min wage. "

 JC wrote on July 24, 2008 8:25 am:
" Just a price floor for labor. Will create a surplus of labor, AKA unemployment. But nobody will complain about getting paid more. Just a cheap way for the Dems to get votes. "

 joseph gale wrote on July 24, 2008 8:37 am:
" sweet and hour of work can buy a gallon and a half of gas. let the good times roll! "

 Tipped employees wrote on July 24, 2008 9:07 am:
" Tipped employees aer guaranteed the minimum wage as well. The employer only has to pay the lower amount if the amount of tips doesn't add up to the minimum wage. "

 CS wrote on July 24, 2008 9:08 am:
" And about half the employees there, including asst. managers are college aged or older, thus adults. What is your point? Are you suggesting that there be a tiered wage structure based on age? Working HS students don't pay any less than anyone else for things. HS aged kids used to be considered adults a generation ago. I have not see 1 instance, in 17 years of working through HS and college to the present where I was paid differently just because of my age instead of by the job I was doing. Anyone under 16 already makes less and does not have to be paid minimum wage either. What is your magical age that someone should be at to make minimum? "

 Movie Theater wrote on July 24, 2008 9:11 am:
" My sister worked at a theatre for four years during COLLEGE, not high school. She barely made it, but if you budget and don't have a car payment, you can live with a roommate and make it, she did at 5.15 / hour. "

 CS wrote on July 24, 2008 9:12 am:
" Wages for theater employees are what they are because the Motion Picture companies consider them a type of seasonal worker. They are not required to have breaks/lunches, and that they get paid what the do is due to the largess of the company, in this case Marcus, rather than any sort of industry standard. "

 mike wrote on July 24, 2008 9:15 am:
" If you don't like making minimum wage do something to change your situation and stop waiting for the gov to take care of you. There are very few situations where people are actually 'stuck' in a minimum wage job--it should be used as a stepping stone for most of us. "

 taxing wrote on July 24, 2008 9:19 am:
" When Mayor Beutler adds a lincoln income tax the minimum wager will lose everything they gained! "

 To Neo wrote on July 24, 2008 9:28 am:
" Now, see, I know several people who work at the theatre, and they are COLLEGE students. And why shouldn't college students make a decent wage? Everybody deserves to make a decent wage if they're willing to work. Don't assume you can make accurate judgements based on.......nothing. "

 Waitress wrote on July 24, 2008 9:41 am:
" As beerorkid stated, the minimum wage for a server is $2.13, NOT $6.55 as implied in the sidebar. I believe this has been the wage for servers in Nebraska since 1980. If you think the economy stinks, try depending on people for tips when they think you are already making minimum wage based on misinformation like this article. "

 Raise wage raise prices wrote on July 24, 2008 10:12 am:
" Raising the minimum wage is counter-productive. Businesses will have to raise the price of their goods and services in order to pay higher wages. In other words, the minimum wage will never catch up to what a living wage should be. "

 Mid Nebraska wrote on July 24, 2008 11:20 am:
" Now don't forget that every other employee will probably have to get a raise. The guy that was making $7/hr will get bumped up and so forth. So in turn the product they are making or selling will have to go up too. If you look at who was the lobbying congress for the minimum wage increase, it was the big labor unions! Many times their pay is based off of minimum wage. Now the person making $17.50 will go up too just because of the hike. I think government should stay out of the way of business and let the free market work like it is supposed to. There shouldn't even be a minimum wage. "

 CS wrote on July 24, 2008 11:27 am:
" Then maybe instead of all of us having to adjust, the business and service providers can make an adjustment as well? While capitalism is great, I feel there is some amount of responsibility for the business owner to the workers themselves. That's the one great failing of capitalism-sure, you can go find a 'better' job but if everyone's idea of a living wage is the lowest possible denominator then really what choice does anyone have with some sort of mandate? "

 wanna raise wrote on July 24, 2008 12:00 pm:
" hey Mid Nebraska I wanna work where you do, just because the min. wage went up does not mean everyone else automatically gets a raise too. Another misconception. "

 DOC wrote on July 24, 2008 1:28 pm:
" Okay Class, why not raise the minimum wage to $20 per hour or $40 per hour? Crazy? Why? Don't we want people to have a living wage? What will happen as the minimum wage increases? Employers will either raise prices, not hire as many employees or lay off employess. Why do we need a minimum wage at all? To protect the workers that don't want to improve. If they improve, they become more valuable to their present employer or they are valuable to the employer down the street. Either way they win. "

 Geez wrote on July 24, 2008 2:23 pm:
" The "okay class" thing is so condescending. Ugh "

 My pay did not wrote on July 24, 2008 3:01 pm:
" go up and I make well over $6.55... "

 CS wrote on July 24, 2008 3:02 pm:
" You are assuming that base human nature will win out over capitalism. Good luck with that. If we hadn't passed child labor laws my 8 year old son would be working in a plant right now. "

 as wrote on July 24, 2008 3:07 pm:
" Just because someone is WILLING to work does NOT make them deserving of a decent wage. I agree with Mike - minimum wage jobs should be a stepping stone to better jobs or careers. There is no reason why someone should be stuck in a dead end minimum wage job for their entire life. Well there is - but it wouldn't sound complimentary to such a person.

Don't see how 'Ok Class' was condescending. A lot of truth there which probably most people don't want to hear. Minimum wage for fast food -which mostly hire high school & college students - is fine. If someone chooses to stick with a minimum wage job their whole life, society as a whole should question why. Not prop them up & support them. "

 Hey ya know whats funny wrote on July 24, 2008 3:17 pm:
" The poor folks making minimum wages will have their taxes used to "BAILOUT" Bear Stearns while the man RESPONSIBLE for that fiasco is paid $20,000,000. That's right, folks.............20 MILLION dollars.

Ain't that FUNNY? HA! HA! HA! HA! HA!

Greedy capitalism is just GREAT!

I GOT MINE! Just trying to decide whether to let some "trickle down" or not...................I decide NOT. Too bad, you lose.

Need a better job that doesn't pay minimum wage.

Shoot, I'll give you $6.60.

I'm sorry, am I coming off as bitter? "

 fast food guy wrote on July 24, 2008 3:38 pm:
" it is just a matter of time before the dollar menu goes away $10.00 combo meals. "

 capitalism wrote on July 24, 2008 6:32 pm:
" I agree with the comments bashing capitalism. It is great to a point and then the greedy CEOs don't care about the worker, just the profits that they pocket. WalMart, oil companies, plants that outsource, movie theaters (you know how much THEY must make, $8 per person every 2 hours). It's true, better your life, but you do have to start somewhere. I think it should be raised. "

 Lets do like Oregon wrote on July 24, 2008 7:56 pm:
" In Oregon, it is state law that you can't pump your own gas. There are attendents at every station who do this for you, for minimum wages. This is their answer to unemployment (and maybe those who got "too lit up and burned out" on the hippy craze?). These jobs serve their purpose and are good and well for a great many people. Who says you have to stay in these lines of work? They should be incentive for those who are unhappy with the pay to seek better opportunities, further their education, or move to Oregon to pump gas. And by the way, I am in a licensed profession and barely make more now than I did 20+ years ago when I entered the profession. My wage DOES NOT bump when minumum does. Think about that the next time I infuse your chemo or heart drugs! "

 CS wrote on July 24, 2008 8:58 pm:
" Don't mind your list, except the movie theaters. Over 80% of your ticket goes to the movie production company, distributor, and actors. That 20% goes towards overhead, and wages. "

 So sad wrote on July 24, 2008 9:34 pm:
" As long as these minimum wage jobs are just stepping stones, can we exclude them when we discuss the unemployment rate. Take away the crappy service industry jobs and it's going to look a heckuva lot worse. Add in the massive US prison population and the massive size of its military forces on the basis that both predominantly move people that would be otherwise unemployed out of the labour force, and boy howdy, well, I guess I already knew the W economy was in the toilet that those minimum wage earners are supposed to clean on their way to the far better career that we'll pretend is awaiting them.......got that, class? "

 haaaaaaa wrote on July 25, 2008 2:08 am:
" Walmart pays at least 7.20/hr....and they've got pretty decent benefits. More than can be said for other "stepping stone" jobs. "

 Ooooh wrote on July 25, 2008 7:53 am:
" But remember, you can't move up at Walmart if you are a woman. That's why they are being sued by 2 million women. Stepping stone to nowhere within the Walmart company. Walmart is part of what's wrong with our economy. "

 Casey wrote on July 25, 2008 8:27 am:
" Minimum wage was never meant for you to be able to support your 8 kids, have a cell phone, your new car and expensive clothes you "have to have". It was meant for you to be able to earn a living while moving up to bigger and better things. If capitolism is such a terrible thing...move!!! Your ancestors came here for a better life for the future generations of their family and you're complaining. Boo hoo. Not one of those immigrants expected anyone to provide them with free health care, food stamps, WIC and reduced childcare costs. Why does society think this is needed now? These services are not for you to stay on and act as if you're doing this on your own! Add up the benefits your getting for all these services and you're making a whole lot more than most people! Too many people worry that if they get a better job they may loose all their "perks" instead of seeing it as being able to support themselves. I'm all for people making more money and bettering themselves, maybe those trying to raise a family on min wage should be wanting the same thing instead of standing in line with their hand out. "

 Hey Casey wrote on July 25, 2008 8:47 am:
" get a chill pill will ya? Jobs are hard to find when you have been laid off or plant closed. Yes you are supporting a family on $6-$8/hr. I have no clue what dock you shipped at but don't lump everyone together. There are many that make the $20/$30/hr and can't spend within their means either, road goes both ways. No people can not live on it. LES has raised, Aquilla will raise, heard 40%-60% and now the water department...am still netting less and I make $12/hr with NO CREDIT CARDS or CAR PAYMENT. "

 Lincolnite wrote on July 25, 2008 9:06 am:
" Marcus Theatres will not have any problem paying its employees the new higher minimum wage. People continue to buy fountain pops at $4.25 a cup. That's only about a 4000% markup! Other businesses will struggle with this though. "

 to casey wrote on July 25, 2008 11:10 am:
" ya know what some of the cut off points to all of the welfare that you mentioned is right at around 36000-40000 a year for a family of four. thats well above the minimum wage. that tells me that the government knows that you cant support a family on minimum wage and they-the government are willing to help out? sure its easy to tell people to get of their butt and go to school, but if they are so worried about working all day to make ends meet and taking care of thier family and paying bills and taking care of sick kids and trying to find daycare for the kids from 6-10 pm and then have to go to school from 6-10 at night. they are not going to do well in school at all. bad things happen to good people, not everyone is out for a free ride. not everyone has a family members who help out either. "

 Min-wage a non-issue wrote on July 25, 2008 12:53 pm:
" If you don't wan tto make minimum wage, get an education and apply for jobs that pay closer to 15 or 18 an hour. Too stupid for school? Be a garbage man...they make 20 bucks an hour. "

 CS wrote on July 25, 2008 1:28 pm:
" Here we go, assuming that the markup on popcorn, fountain drinks, and concessions is just pure profit. Douglas/Marcus's costs for concessions alone have gone up 35% in the last year-and they raised the price of a Lg fountain what, a whole quarter? Movie companies wasting money trying to sue people for file sharing, and making crappy movies that don't make money, is cutting into their profits, so they force a required showings rider on their contracts on the theater. The theater can't guarantee that every movie is a blockbuster, or that people will see it, so they pass those costs on the the consumer via the ticket prices with go almost completely back to the movie distributor, vendor, and production company. Every business operates this way. You pay for the privilege of seeing a movie on a 60 foot screen in a comfortable chair in a climate controlled environment, with food and drinks available-and the theater itself sees very little of it. Costs drop when you stop paying them-continue to pay them and there is no reason for the cost curve to shift. McDonald's only makes about 2 cents per hamburger-I don't see anyone complaining about the cost of their stuff-why is it that the movie theater is one of the whipping boys here? If you know how to do it better, apply to be the GM at the Grand. You'd be in for some revealing surprises about how you *Think* the industry works. "

 lol funny wrote on July 25, 2008 3:01 pm:
" Can't move up as a woman at Walmart? Look at Walmart's corporate line-up...oh yeah, there's women there. The south Walmart's store manager is a woman...half the management team at the south Walmart is women. Sue away, they have no basis. Walmart can't be that bad if they employ 2.2 million people. If its that bad, they'd quit by now. "

 Hojan wrote on July 25, 2008 11:26 pm:
" I feel sorry for the person that is making $7.30/hr. I mean a year or two ago that was quite a bit above the minimum but when it hits $7.25 it won't be much at all. You rarely see other wages increased the same amount either - so when you raise minimum wage the majority of people make less money compared to the minimum. "

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