The Kentucky Speaker of the House says raising the state’s minimum wage won’t hurt businesses and will actually lower the jobless rate if what has happened in 13 other states holds true for the commonwealth. Under Rep. Greg Stumbo’s House Bill 278, the state’s minimum hourly wage would gradually increase to $10.10 over the next two and half years.
The Prestonsburg Democrat’s plan would increase Kentucky’s current minimum wage of $7.25 an hour to $8.20 this August, then to $9.15 in July 2017, and finally to $10.10 in July 2018. The increase would only apply to employers with more than a $500,000 in annual gross sales in retail, service, lodging, and restaurant businesses.
Stumbo insists his approach protects the small mom-and-pop operations by exempting them from the mandate. He adds that 29 states have increased minimum wage rates above the federal level.
As of now a worker earning minimum wage makes about $15,000 a year. Stumbo says his measure, if it becomes law, would add $2,000 more to the incomes of those wage earners. Stumbo told the House Labor and Industry Committee Thursday that Kentucky should follow the lead of major retailers who recognize the obligation to pay a living wage.
But Tod Griffin, a spokesman for the Kentucky Retail Federation, says the impact of an artificial wage hike has negative unintended consequences.
Kentucky last raised the minimum wage in 2007. It went into effect in 2009 and is the same as the federal wage rate. Officials in Louisville and Lexington have approved wage hikes for those communities to exceed the state minimum.
The labor and industry panel passed the measure 14 to 6. It now heads the full House for consideration.
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