Massachusetts Raises Ante on Escalating State Minimum Wages

Massachusetts Raises Ante on Escalating State Minimum Wages

Massachusetts is poised to lift its wage floor to $11 an hour—50% higher than the federal rate– becoming the fifth state so far this year to lay claim to setting the nation’s highest minimum wage.

Massachusetts Gov. Deval Patrick, a Democrat, is expected to sign a bill by early next week to increase the state’s minimum wage by a dollar each year until 2017. The move would surpass Vermont, which two weeks ago approved raising its minimum wage to $10.50 an hour by 2018. Washington state, at $9.32 an hour, has highest current state wage floor.

One of the Massachusetts bill’s primary backers, Democratic state Rep. Thomas Conroy, said placing the state’s businesses top among minimum wage payers was a goal of his. The state’s current minimum is $8 an hour.

The new law will “make sure people working full time are not living in poverty,” he said. “Washington is not doing it, so we had to step up.” Despite the endorsement of President Barack Obama, efforts to lift the federal minimum wage to $10.10 an hour from $7.25 have fizzed in Congress.

Ten legislatures have passed minimum wage increases so far this year. Rhode Island lawmakers last week approved an increase to $9 an hour starting next year from $8. A spokeswoman said Gov. Lincoln Chafee, a Democrat who previously served in the U.S. Senate as a Republican, has yet announce if he’ll sign the measure.

The pending Massachusetts law likely mutes a proposed ballot initiative that sought to raise the wage to $10.50 an hour.

It would increase pay for workers that receive tips to $3.75 an hour from $2.63. The ballot measure would have set the tipped wage at 60% of the broader standard.

The bill passed the legislature last week despite opposition from the state’s restaurant association and other business groups.

“It’s extremely frustrating,” said Erin Calvo-Bacci, owner of Bacci Chocolate Design, a small candy maker in Swampscott, Mass. The company will no longer hire part-time high-school students to help during busy seasons because those workers lack enough experience to justify an $11 wage, she said.

The company considered moving its production to nearby New Hampshire, where the minimum wage is $7.25 an hour. However, Mrs. Calvo-Bacci said the she and her husband ruled out the option because they worry New Hampshire will soon follow the half-dozen other Northeast states that have raised the minimum wage in the past two years.

Other business owners support the change.

“Raising the minimum wage is going make 100,000 people very happy,” said Michael Kanter, owner of Cambridge Naturals, a health store in Cambridge, Mass. “Those happier people are going to be more willing to spend money, even at premium stores like ours.”

At $11 an hour in 2017, Massachusetts would have the highest state wage in the country. Current laws dictate Connecticut’s minimum wage will be $10.10 an hour that year and California will have reached $10.

Several other states have wages tied to price increases. Based on Congressional Budget Office inflation projections, Washington’s wage is estimated to be $9.92 an hour in 2017. But by that year some Seattle employers will be required to pay $15 an hour, under city law.

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