News and Observer
Published: Jan 09, 2006 12:30

Wages at the bottom

In fairness, North Carolina's minimum wage is overdue to be raised. Inflation has chipped away at the value of $5.15, the minimum hourly wage required by federal law nine years ago. Today, it takes $6.26 to buy what $5.15 bought in 1997.

Against that background, it's apparent that State Treasurer Richard Moore isn't climbing too far out on a limb with his proposal that the state minimum wage be raised to $6.15 an hour. Nevertheless, it takes moxie to call for even that modest increase in front of business groups that have steadfastly resisted any increase at all.

Understandably, Moore doesn't spend much time extolling the benefits of an extra dollar an hour to workers. Members of the N.C. Citizens for Business and Industry have been more concerned that raising the minimum would drive up labor costs enough to crimp profits.

Moore's case rests on the effect that bare-minimum employers have on their competition: The more their workers are forced into public programs, the more tax revenue must be collected from businesses to pay for them. Taxes crimp profits, too.Because of a rosy economic outlook, now is an opportune moment to even things up for employers and workers alike. Business investment and expansion predicted for this year promise to blunt the impact of higher labor costs on bottom lines.

Besides, higher wages would serve North Carolina's goal of stimulating the economy beyond its growing cities. More money in the hands of low-skill workers would be spent in areas of the state without many high-paying jobs.
Workers earning the current minimum wage can't afford to shop at Wal-Mart stores, one reason why Wal-Mart's chairman recently called on Congress to raise the federal minimum. A simpler reason for lawmakers to act would be fairness to hard-working people.

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