Minimum wage debate continues as state rate rises to $8.25

The minimum wage in Delaware  increased  $8.25 an hour on Monday as the pros and cons of mandated pay continue to be argued.

The previous minimum wage was $7.75 an hour. The federal minimum wage is $7.25 an hour. Efforts to raise that wage on the federal level to $9 or more  failed last year.

Legislation to increase the Delaware minimum wage to $10.25 an hour,  later in the decade,  did not move forward in this legislative session. This could be due to the recent minimum wage increases and opposition from the business community.

In early 2015, a coalition of  business groups in Delaware also rolled out a website claiming an even higher minimum wage was a dangerous proposal, citing the possible loss of jobs

. Members of the coalition included restaurants and larger chambers of commerce in Delaware. The site, which cities studies that claim  job losses from a higher minimum wage, has not been updated since early 2015.

A report from the Congressional Budget Office  offered  a mixed picture, with some workers gaining from the higher wage.  Others, could see their  positions eliminated as fewer people work harder or processes in fast food and other areas   become automated. At the same time, the  challenges of living on a minimum wage were outlined in a report by the National Low Income Housing Coalition.

The Out of Reach report indicated it would take an individual working 109  hours a week at the minimum wage to afford an average two-bedroom apartment in the state.  Voters and legislatures in California and elsewhere  have been raising the wage,.

Now being closely watched is Seattle, which has moved forward with a $15 an hour minimum wage.

The jump did not trigger large layoffs as some had predicted, although critics of the higher wage say the negative effects will take place over a longer period

Opponents  argue that a lower minimum wage provides a way to provide jobs for unskilled workers who can make more money as more skills are acquired. Wages are also rising without a mandate as the labor market tightens, they  argue.

Minimum wage foes  also claim a higher minimum wage raises pay across the board and leads to fewer entry-level jobs, with unskilled workers unable to secure positions. Backers  say that many single parents and those holding down more than one job would benefit from the bigger paychecks.

Delaware is one of 29 states that have  a state minimum wage. Neighboring Maryland will see its minimum wage rise to Delaware’s figure in July. Further increase will result in a minimum wage of $10.10 in 2018. Legislation calling for a $10.25 an hour minimum wage by 2019 in Delaware was introduced in this session, but no action has been taken.

New Jersey’s minimum wage is $8.38 an hour, with indexes that  account for increases in the cost of living. Pennsylvania’s minimum wage remains at $7.25 an hour.

California is slated to increase its minimum wages from $9 to $10 in 2016.  Other states, such as New Jersey and Colorado, tie increases in the minimum wage to the cost of living.

Voters in Los Angeles recently approved a $15 an hour minimum wage later in the decade, following the lead of San Francisco and Seattle.

Complicating the situation in Los Angeles were demands by a union  coalition for an exemption  from the minimum wage. Business leaders suspected this was a ploy to force employers to come up with collective bargaining agreements with locals as a way to keep pay below the mandated wage.

Unions argued that flexibility was needed in negotiating better health care and other benefits. As industrial employment declines, unions are working to organize those making near the minimum wage

A report from the Pew Research Center iindicates that the minimum wage had the greatest buying power in 1968 when the figure was equivalent to $8.54 an hour (in 2014 dollars).