The minimum wage has been raised to $7.64 in Colorado, a move that will be welcomed by some 74,000 minimum wage workers in the Centennial State.
The 3.8 percent increase took effect on New Year’s Day, and represents a raise of 28 cents per hour. A Colorado employee who works a full-time job on minimum wage will now earn an extra $582 a year. Colorado has linked its minimum wage to inflation since 2006, and this is the largest increase since the policy was introduced. Workers just above the minimum wage will also see raises, predicts Patty Goodwin, director of surveys at the Mountain States Employers Council:
“It becomes a domino effect all the way up if you have a compensation policy where you keep a consistent spread.”
While employers and business owners are likely to be dismayed, many argue that raising the minimum wage is a positive move for the economy. Extra money in pockets, argue economists, means people are more willing to spend. Speaking to the Denver Post, Christine Owens, executive director of the National Employment Law Project, says:
“These minimum-wage increases represent bright spots on an otherwise bleak economic horizon.”
The borked economy is seeing the age of those in minimum wage jobs increase, with one analysis of census data revealing eight out of 10 workers in Colorado who earn the minimum wage are now 20 or older. 46-year-old Kelly Wiedemer is one such example of this. After losing her $31-an-hour job as a financial analyst in 2008, she took work as a cashier at a gas station. She told the Denver Post that the increase will help:
“Having experienced this working-poor thing for the first time, the wage increase makes a huge difference. It helps to offset lost spending power. This is a step in the right direction, but it is not a living wage by any means. It helps low-wage workers from falling further behind.”
The federal minimum wage is $7.25 an hour, while the highest minimum wage in the U.S. is in San Francisco, which recently became the first state to offer a minimum wage above $10.