Rise in Oregon's Minimum Wage Set to Take Effect

(SILVERTON, Ore.) - The ushering in of the New Year will bump up Oregon's minimum wage by 15 cents, helping low-wage earners keep pace with inflation. Despite the increase, many at the bottom rung of the pay scale will remain mired in poverty, according to the Oregon Center for Public Policy.

Oregon's minimum wage will increase from $7.80 to $7.95 per hour on January 1, 2008, the Oregon Bureau of Labor and Industries announced earlier this year. The increase reflects the rise of the cost of living as defined by the Consumer Price Index and is mandated by Ballot Measure 25, approved by voters in 2002.

The increase means an extra $312 a year and a total annual income of $16,536 for a full-time minimum wage worker. That is still below the $17,170 that constitutes the 2007 federal poverty line for a family of three.

"Adjustments to the minimum wage are essential for keeping the lowest-paid workers from falling further behind, but they are not a ticket out of poverty for most families depending only on a minimum wage job," said OCPP policy analyst Michael Leachman.

In 2006, the most recent year for which data is available, about one out of every 15 working families with children remained poor despite their work effort, said Leachman. He stressed that the percentage of working families falling below the federal poverty line is more than twice as high as a generation ago.

Moreover, the federal definition of poverty undercounts the poor, critics have long noted. Devised in the 1960s, the definition excludes costs such as child care, housing and transportation, which today make up a larger portion of a family's budget than they did a half-century ago, said Leachman.

Although 2008's minimum wage increase won't necessarily help alleviate poverty, it will help ensure that the problem does not worsen, according to the Silverton-based think tank.

"The minimum wage sets the floor," said Leachman, "and in that respect, Oregon has demonstrated leadership."

With the 2002 passage of Measure 25, Oregonians voted to increase the state's minimum wage from $6.50 to $6.90 per hour effective January 1, 2003, and to tie it to inflation, as defined by the August Consumer Price Index.

In 2008, Oregon will have the nation's third-highest minimum wage, behind Washington ($8.07), California ($8.00) and Massachusetts ($8.00). Oregon's minimum wage will remain ahead of the national minimum wage of $5.85 per hour, scheduled to increase to $6.55 per hour on July 24, 2008.

Oregon's inflation-adjusted minimum wage has not dampened job growth, as critics of Measure 25 predicted, according to OCPP. The Center's analysis shows that Oregon's non-farm payroll employment growth was 12th fastest in the nation from 2002 to 2007.

The Oregon Restaurant Association's 2002 prediction that "nearly 30,000 more Oregonians could lose their jobs" as a result of Measure 25 has not panned out. Since the measure's enactment, employment in the restaurant industry -- one with a relatively large share of minimum wage workers -- has grown 19 percent, more than twice as fast as the overall non-farm payroll statewide, OCPP found.

And job growth in the restaurant industry appears set to continue. The Oregon Employment Department recently forecast that from 2006 to 2016 the restaurant industry will add more jobs -- about 22,700 -- than any other industry in the state. The department estimated that during that period, restaurant jobs will grow by 19 percent, faster than the projected 14 percent growth in all non-farm payroll jobs.

"This New Year Oregonians should make a resolution to focus on how we can best help those in our state who cannot make ends meet despite the minimum wage gains," said Leachman.

The Oregon Center for Public Policy does in-depth research and analysis on budget, tax, and economic issues. The Center's goal is to improve decision making and generate more opportunities for all Oregonians.

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Jefferson December 31, 2007 10:25 am (Pacific time)

People feldman simply does not understand micro or macro economics (though I'm sure "TFI" will chime in with his futile analysis soon) as he so clearly points out when he assigns causal variables. He is simply uninformed, but fortunately he is not a policy maker...that's why we need to vote out of office the people who share the same level of incredible ignorance as feldman...who appears to be getting more and more frustrated as poster's challenge his idiocy.

Jefferson December 31, 2007 10:24 am (Pacific time)

Henry Ruark December 31, 2007 6:11 am (Pacific time)

Nea; et al: DO believe historical record will avail us of solid proof that communism was long-time tested in Russia and elsewhere, and proven to have inherent flaws at least as bad as those we now experience in the advanced stage of capitalism. But fear of takeover from either Russia or China is now the favorite flavor of that weapon ("fear") still often flourished by neocons without real poltical progess of their own to produce results people can see, feel and enjoy. SO we have costly "war on terrorism" as rapid working tool for their ongoing inroads on our democracy, while the real terrorism abroad in the world goes untouched and unscathed. Yes, there is (or was) a bin Laden, and yes, there was the worst possible attack on our complacencies via New York disaster --which we still fail to confront, per ongoing real problems in airport and air travel security.

Neal Feldman December 30, 2007 2:44 pm (Pacific time)

The funny thing is that honestly communism has never been tried... so how can it be discredited? Humanity has not advanced enough for it to work as far too many would take more than they need and give far less than they are able (greed and sloth accordingly). Even most or all alleged socialist states have been so in name only... primarily they are military backed oligarchies putting up a veneer of socialism. Ah well...

Henry Ruark December 30, 2007 12:18 pm (Pacific time)

To all: IF indeed communism is so fully and deeply discredited, we have no further need for fearful reference to it. Simple-minded suggestion that we cannot learn from the record on communism, and from the ongoing application of socialism in some (other) leading nations, is also stupid and disrupting. We need to demonstrate the values and accomplishments of our own democracy, deeply now in trouble by seduction and sabotage by ongoing Neocon attack at many levels. Let's get on with making what we still have better, stronger, more supportive of all, and achieving of that "American Dream" on which we had such a great start.

Neal Feldman December 30, 2007 10:23 am (Pacific time)

CommiezDoExist - If Dallas is a booming community it has little or nothing to do with the Texas minimum wage. Otherwise EVERY Texas community, having the same minimum wage, would be so booming. And I assure you Texas is hardly paradise on Earth to live in. Oregon is much better on virtually any yardstick. But keep the disproven anti-minimum wage myths coming, they are so easily shot down. Ah well...

Neal Feldman December 30, 2007 10:19 am (Pacific time)

Jefferson - Ah ever the moronic cheerleader for neocon nonsense. If your theories were true then reducing all taxes and fees to zero would result in infinite tax income. But it does not seem to be the case. Also you conveniently ignore that during the 50s and 60s, arguably the most prosperous years in our nation, the highest tax rate was nearly three times what it is today. And as for your whines that the minimum wage hurts jobs you ignore that since the rate went up ther are more jobs than before the increase pretty much every time. As for it increasing costs the same amount that is proven BS because wages are only a part of the cost equation for the employer... minimum wage jobs making up a small part of that. There are materials, stock, transportation, benefits, utilities, rent, etc that almost all have a bigger effect. In your typical minimart you have one minimum wage flunkie at a time and the store is open 24 hrs lets say. This means the minimum wage increase for 2008 will raise the overall cost for that owner to operate that establishment by a whopping $3.60 a day. My my my how will that poor store owner ever cope? And if they sell 500 items per day that means the average increase cost due to the minimum wage per item is less than a penny. Yet it results for a minimum wage employee in a $6 a week raise which may not sound like much to some but to them is quite a help. But since you are so involved in just spewing your delusional ravings, your lies and your neocon nonsense (I know I'm being triply redundant, so what) rather than helping anyone it is not surprising to see your post here at all. Ah well...

CommiezDoExist December 29, 2007 1:13 pm (Pacific time)

If you have a choice of open a business in Dallas, Texas or Portland, Oregon... which would you choose. As a business owner, this table would help you decide. http://www.infoplease.com/ipa/A0930886.html Paying the employee $2 less per hour adds up quick. This probably explains why Dallas is a booming community.

Jefferson December 29, 2007 12:42 pm (Pacific time)

Who creates the jobs? Who taxes the job creator and wage earner (at growing rates when they can) and wastes the money with one boondoggle after another? How many poor people out there have: Cars, colored tv's, computers, air-conditioning, etc. ? How many people have you read about who have starved to death here in America? How about in other places? How come so many people come here if poverty is so rampant? Since socialist's support an open border policy, how many of these illegals are not just taking jobs, but also driving down wages? The problem is the socialist's, the cure is to keep taxes down so more investment will help create more employment. Enforcing the immigration laws (yeah, simple enforcement, not new laws) will get the interlopers to self-deport and help ameliorate poverty (look at what is happening in Arizona!). The left's way of dealing with poverty is to raise taxes, yeah that should really stimulate the economy and diminish poverty! Do not trust these socialist creatures!

Henry Ruark December 29, 2007 10:19 am (Pacific time)

To all: Key statement here is this one, stressing lack of forward movement for certified solid sensible working group which is foundation of Oregon labor: "In 2006, the most recent year for which data is available, about one out of every 15 working families with children remained poor despite their work effort, said Leachman. He stressed that the percentage of working families falling below the federal poverty line is more than twice as high as a generation ago. Moreover, the federal definition of poverty undercounts the poor, critics have long noted. Devised in the 1960s, the definition excludes costs such as child care, housing and transportation, which today make up a larger portion of a family's budget than they did a half-century ago, said Leachman." Both parties are at fault, but basic opposition has long come from GOP, now become the neocon cabal undermining each and every essential element of our economy, for their own now obvious special interest involvements.

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