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Business, worker groups split over pending increase in Missouri's minimum wage to $7.35 an hour

This article first appeared in the St. Louis Beacon, Nov. 15, 2012 - As of January 1, Missouri’s state minimum wage will increase to $7.35 an hour – or 10 cents above the federal minimum wage.

And not everyone is pleased.

“At a time when Missouri businesses are struggling to provide jobs in today's difficult economic climate, it is concerning news that labor costs will increase and Missouri businesses will become less competitive compared to other surrounding states,” said Daniel P. Mehan, president and chief executive of the Missouri Chamber of Commerce and Industry.

But pro-labor groups disagree. “It’s encouraging that the lowest-paid workers in Missouri will finally receive a raise next year, if only a small one,” said Lara Granich, director of Missouri Jobs with Justice. “While extensive corporate-backed opposition has allowed Missouri’s minimum wage to remain decades out of date, these annual indexing adjustments will at least prevent the purchasing power of the minimum wage from falling even further as the cost of living continues to rise.”

Granich said the 10-cent-an-hour increase amounts to an additional $200 a year.

Missouri adopted a state minimum wage after voters approved it in 2006. The state is among 10 nationally that have automatic increases built into the legislation, and among 18 that have state minimum wages higher than the federal minimum wage of $7.25 an hour.

Still, next January will mark the first time in three years that the state minimum wage has increased.

Mehan with the chamber pointed out that, of Missouri’s neighboring states, only Illinois will have a higher state minimum wage. He asserted that Missouri will be “at a competitive disadvantage with surrounding states.”

Mehan also noted that the Chamber is among the business groups that have sought to eliminate Missouri’s automatic mechanism for increasing the state minimum wage.  “This announcement (of the 10-cent hike) underlines the need to break Missouri’s minimum wage away from the automatic escalator to which it is currently tied,” he said. “It causes uncertainty and positions Missouri to eventually raise its minimum wage to uncompetitive levels.”

Missouri Jobs with Justice contended, “Strengthening the buying power of low-wage workers is especially critical in this economic climate,” and cited several studies that concluded that a higher state minimum wage didn’t hurt a state’s economy.

Jobs with Justice also  noted that it tried unsuccessfully to get a measure on this year’s ballot that called for increasing the state minimum wage to $8.50 an hour. The group “corporate-backed opponents who used the legal process to exhaust the timeline for appearing on the ballot.”

Jo Mannies is a freelance journalist and former political reporter at St. Louis Public Radio.