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A Proposal To Raise Connecticut's Minimum Wage Stirs Debate

By Gregory B. Hladky

March 06, 2012

You could work full time, every week of the year at Connecticut's $8.25-per-hour minimum wage and come up with a pre-tax annual income of $17,160. That's more than $5,700 below the federal poverty level for a family of four.

When you adjust for inflation, it's also way below what a minimum wage worker was making in Connecticut 40 years ago, according to a study done for the liberal advocacy group Connecticut Voices for Children.

If this state's rock-bottom pay level had kept pace with the rising cost of living, minimum wage now would be at $9.75 per hour, which not-so-coincidentally happens to be the target for new legislation causing a stir at the State Capitol. The bill would also link the minimum wage to the cost-of-living index.

Business and Republicans are not happy about the idea. They insist this isn't going to help Connecticut's miserable job-creation record, would jump up costs for employers at a time when they can least afford it, and would hamstring this state's agonizingly slow climb out of the recessionary swamps.

"There are scores of economic studies showing that hikes in labor costs actually harm rather than help minimum wage earners," Kia F. Murrell told lawmakers at last week's hearing. Murrell is a lawyer with the Connecticut Business & Industry Association, top lobbying group for its more than 10,000 members.

The problem for legislators in this election year is figuring out which study to believe. The Connecticut Voices for Children report, compiled by theWashington, D.C.-based Economic Policy Institute, claims "A growing body of academic research … refutes the old notion that minimum wage increases lead employers to shed jobs."

The teeth-gnashing from the business community over this legislation rose to dental-emergency levels when restaurant owners discovered the bill included a little clause to repeal the minimum wage exemption for restaurant waitstaff and bartenders.

Waiters and waitresses now have a base pay of $5.69 an hour and bartenders $7.34 an hour. The exemption is there because these folks normally get tips that push their actual pay at least up to the regular minimum wage and usually considerably higher

Ah, but it was all a mistake, says state House Speaker Chris Donovan, a Meriden lawmaker who happens to be labor's best legislative buddy and a candidate for the Democratic nomination in this year's 5th Congressional District race.

The Economic Policy Institute study argues that boosting the minimum wage in two 75-cent stages (the first in July of this year, the second in July 2013) would mean more cash in the pockets for about 226,000 Connecticut workers over three years.

Those people would include close to 106,000 who would see direct pay hikes in the first year. Another 58,000 are earning just above the current minimum wage and would likely see wages increase as well.

Right now, Connecticut's minimum wage ranks it fourth in the nation, a spot it shares with Illinois and Nevada. Washington is on top, with $9.04 an hour, with Oregon close behind at the $8.80 level and Vermont at $8.46. The federal minimum wage has been holding steady at $7.25 since 2009.

(Editors Note: The original version of this story incorrectly stated how long the current federal minimum wage has been in effect. The federal minimum wage was last increased in 2009.)