Mosher: Businesses divided over minimum wage

By Bill Donovan
Staff writer

GALLUP — Business owners in this area are divided on the question of a possible new minimum wage for the state.

A survey taken in the last week by the Gallup Chamber of Commerce shows business owners pretty evenly split over whether they support a new minimum wage for the state, with 26 saying they will oppose any increase and 23 saying they won't oppose it.

The state legislature will be looking at a bill that would increase the state's minimum wage from the current $5.15 an hour to $7.50 an hour. Gov. Bill Richardson says he supports an increase as well.

Chamber Director Herb Mosher said about 50 business owners participated in the survey, which was a good figure since the chamber required a turnaround time of only about two days because chamber officials wanted to present it to a meeting in Santa Fe on Tuesday.

So far 14 states have approved increases in the minimum wage, said Mosher, with two states in this area Arizona and Nevada expected to consider proposals later this year. Arizona is looking at increasing the minimum to $5.95 in 2007 and $6.75 in 2008 with Nevada looking at about the same.

Currently, only Santa Fe has approved higher minimum wage increases. It's currently at $9.50 an hour, but Mosher said cities like Gallup can't afford to pay those kind of wages. (Albuquerque voters rejected a higher minimum wage by 118 votes, but Mosher said that may have been because the law would require businesses to open up their books to the city).

Richardson hasn't said yet what he favors, but said he will do so Monday at the opening of this year's legislative session.

Mosher said it appears Richardson favors going with the Wisconsin example.

A year ago, Madison, Wis. increased the minimum wage to $8.50 an hour which spurred the state to approve legislation to approve a state-wide increase to $5.70 an hour with a special rate for youth of $5.30 an hour. On July 1, Wisconsin will go to $6.50 an hour ($5.90 for youth).

There have been some talks of exemptions and different rates in New Mexico, but Mosher said this may not be supported because of the problems of enforcing two or more different rates.

Gallup area businesses, by a 3-1 margin, favor giving a lower rate to youth and Mosher said this reflects the desire by area businesses to provide as many jobs as possible for youth. If the state has the same rate for youths as adults, businesses may be more prone to hire adults, Mosher said.

The fact that about half of the businesses say increased minimum wages won't affect their businesses may reflect, Mosher said, the fact that many businesses in this area already pay more than the minimum wage in order to get people to apply.

But most business owners don't want to see the minimum wage increased to more than $6.00 an hour.

One of the problems many businesses in this area will have, said Mosher, is that any large increase would be put into affect in July, giving them little time to adjust to the new increases. One possibility, he said, being considered by the state is to do the increase over two years, which will give businesses more time to adjust.