Posted on: Tuesday, May 3, 2005

EDITORIAL
Legislature should OK minimum-wage raise

The proposed 50-cent hike in Hawai'i's minimum wage, which is up for a final vote today, should be given a thumbs-up from lawmakers and the governor in order to provide a much-needed boost for those at the lower end of the earnings spectrum.

Periodic increases in the minimum wage such as this one are necessary to keep pace with the rising costs of goods and services.

Since 2003, the minimum hourly pay rate has stood at $6.25 — 19 percent more than the rate paid 10 years earlier. The boost in the consumer price index between 1993 and the present is a shade higher: almost 19.9 percent. So the proposed increase to $6.75 per hour seems within reasonable bounds.

Gov. Linda Lingle and others rightly argue that some relief for businesses is warranted, too. For example, she and other Republicans make the case for raising the "tip credit" — the markdown in wages employees can apply to those whose income is fattened with tips.

Also, unemployment insurance reform is long overdue. But neither of these initiatives need to be linked to the minimum-wage bill, which deserves to pass on its own merits.

Critics of the increase point out that the state's tight labor market already has driven up entry-level hourly wages at least to the proposed $6.75 hourly mark and, in many cases, beyond it. A legislated raise, they argue, is unnecessary, and raising the wage "floor" undoubtedly will press other salaries upward.

However, given that overall tax relief is unlikely to emerge for lower-income groups this session, a little more salary security for those working entry-level jobs is something lawmakers should support.