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Some see small change at $7.15
A worker said the wage still fell
short. Most hirers already pay it.
By Kera Ritter and Dwight Ott
Inquirer Staff Writers
Michelle Seddens, a security guard at Camden City Hall,
makes $6.50 an hour - $13,520 a year - checking visitors for weapons.
Across the street, Ron Ford is trying to nurse his
fledgling City Coffee shop, selling coffee and snacks to city employees
and visitors.
New Jersey's proposed minimum-wage increase would affect
both Seddens and Ford, but they represent two very different sides in
the debate.
Seddens, 40, is one of the estimated 290,000 workers in
New Jersey who make less than $7.15 an hour, the rate that legislators
approved Monday and that acting Gov. Richard J. Codey said he would
sign into law after Easter. The current $5.15 rate would rise a dollar
on Oct. 1 and another dollar a year later. Currently, Washington State,
Oregon and Alaska have a minimum wage of $7.15 or higher.
Seddens said that even with the bump, she would have a
difficult time providing for her children.
"Fifty cents more," she said with a smirk.
"It's better than $6.50," interjected her colleague
Chris Vazquez, 20, of Camden, as he waved his metal detector over
visitors.
On Market Street, Ford's coffee shop is the type of
business that routinely pays minimum wage, yet a 16-year-old high
school student earns $6.50 an hour to work the counter. At McDonald's
restaurants in Camden, full-time employees can earn $7.25 an hour.
"It's hard for Camden businesses to attract good
people," Ford said, "and we end up overpaying the people we get."
The change in the minimum wage would not affect all
employers and employees. Public employees and waiters would remain
exempt, as well as hotel and motel workers and farm laborers who
receive room and board. The measure also would exempt part-time
child-care workers in an employer's home and minors without a
vocational-school graduate permit.
Only about a dozen job categories in South Jersey
average less than $7.15 an hour, the state Department of Labor and
Workforce Development said. They include cashiers, food-service
workers, parking-lot attendants, seasonal employees at amusement parks,
and food-preparation workers.
But the problem with the minimum-wage increase, business
owners said, is that other wages would have to increase, too.
"If you bring a new hire off the street making $7.15 and
you have an employee who's been with you five years, they're going to
wonder why they're making the same thing as the green person," said
William Eubanks, who holds 29 Kentucky Fried Chicken franchises in New
Jersey, Pennsylvania and Delaware.
Some of Eubanks' shift managers make $7 to $9.50 an
hour, a rate he expects he'll have to increase. Entry-level workers in
affluent communities with higher costs of living, such as Medford,
already earn more than $7 an hour, Eubanks said. He added that business
owners would pass some of the cost on to consumers, but that he might
end up closing his less-profitable restaurants.
"You try to mask it as much as you can, but consumers
recognize when you've increased the price," Eubanks said. "A taco or a
chicken leg is only worth so much. Nobody's going to pay $5 for a
drumstick."
Economists have debated
whether increasing the minimum wage harms businesses. Princeton
University economists David Card and Alan Krueger found that New
Jersey's minimum-wage increase to $5.05 in 1992 had not hurt the
fast-food industry. They compared New Jersey with Pennsylvania, where
the wage remained $4.25.
Economists David Neumark and
William Wascher contradicted those findings in the Journal of Public
Economics after examining different data. They concluded that New
Jersey's higher minimum wage had led to a 4.6 percent decrease in
employment relative to Pennsylvania.
Card and Krueger
re-researched their data and argued that their original finding was
correct. The debate continues.
Camden day-care director Saiyda Muhammad said the
minimum wage should not be an "us vs. them" issue. About half her 15
employees earn the minimum wage. Most, if not all, rely on welfare for
medical coverage.
"It makes my job a little harder because I need to go
out and recruit to bring in more clients, but if I'm going to get
employees off welfare, we have to give them a way to be able to
financially take care of their family," said Muhammad, director of
three Your Future Academy day-care centers.
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