Colorado to Reduce Minimum Wage

(AP)  Colorado will become the first state to reduce its minimum wage because of a falling cost of living.

The state Department of Labor and Employment ordered the wage down to $7.24 from $7.28. That's lower than the federal minimum wage of $7.25, so most minimum wage workers would lose only 3 cents an hour.

Colorado is one of 10 states where the minimum wage is tied to inflation. The indexing is thought to protect low-wage workers from having flat wages as the cost of living goes up.

But because Colorado's provision allows wage declines, the minimum wage will drop because of a falling consumer price index. It will be the first decrease in any state since the federal minimum wage law was passed in 1938.

"We can't see that there would be any other option" except lowering the wage, department spokesman Bill Thoennes said Tuesday. He said there will still be a public hearing on the question in early November, though the drop appears inevitable. The lower wage will take effect Jan. 1.

Advocacy groups for the poor have been warning of the wage drop since August, when the consumer price index for the Denver area was released. The index fell 0.6 percent between the middle of 2008 and the middle of 2009, mostly as a result of falling fuel prices.

Other states with adjustable minimum wages have seen their consumer price indexes fall, such as Ohio. But Colorado is one of the few states where the law is interpreted to mean the wage can fall. Other states are planning to keep wages flat.

In Florida, deflation would reduce the minimum wage to $7.21, but the state's minimum wage already matches the federal wage, so Florida workers' paychecks won't change.

Other states with minimum wages that rise with inflation are Arizona, Missouri, Montana, Nevada, Oregon, Vermont and Washington.

Colorado voters approved an adjustable minimum wage in 2006. Supporters of that amendment said they did not intend for wages to fall, but the provision allowing it to fall was crucial to its passage. They have pointed out employers of the estimated 50,000 to 70,000 Coloradans making minimum wage are free to leave wages flat.

Ben Hanna, Colorado organizer for the Association of Community Organizations for Reform Now, or ACORN, said the difference is small but significant for poor workers.

"I can't imagine many employers would see this as an opportunity to lower wages," Hanna said in August.

[mauibucky]

This is what conservatives have prayed for for decades. The downward spiral in the American Standard of Living has begun!! That globalization trick fooled us all!!It will take a while, but conservatives are patient.Watch the very rich start buying up Colorado at fire-sale prices.

[Sloughfoot]

2 cents an hour- This is a non issue.

[MontrosMan]

Stop all Minimum Wage. Let market forces determine salary. Get government out of the contract between worker and employer. The arguement that someone "can't sustain a home" based on a certain wage is ludicris. That implys that everyone earning minimum wage is the sole provider for a family. If that is the case, that person should be working a job that pays much more than minimum. Why the heck are they trying to raise their kids working as a cashier at WalMart? Did they not apply themselves at all during their 12 years in school? Did they never study? Did they never apply themselves? Did they never consider they'd have to support themself and their offspring sometime down the road? If the answer is "no" to all of these questions, then why is it up to the gov't to bail them out? Eliminate all gov't mandatory wages across the board. Let market forces determine wage. If people don't like the wage offered, find a different job or start your own business or grow your own food. There will be more jobs available if you eliminate minimum wage altogether.

[endurorob_5]

I think this story is creating some confusion. It gives the impression that those currently working making minimum wage will have their wages cut by 3 cents an hour. That is highly unlikely. What it measn is anyone hired for minumum wage after 1 January will be paid $7.25 an hour.

[Ace22257]

I agree with scubbasteve01. There's no way a person can sustain a single person household earning min wage. Most of these types of jobs aren't that easy to work either, the employers expect a great deal from you. Why do they ALWAYS target the low wage earners? You sure dont hear about any big company executives, sports figures, doctors, lawyers, actors etc. taking any wage cuts. These people keep getting BIGGER & BIGGER salaries that have well gone over the level of absurdity. Start targeting THOSE people so the rest of us can breathe....

[ubrew12]

Since 1979, the wealthiest 1% of Americans have tripled their share of the nations income, while the poorest 90% of Americans have seen their share of the nations income reduced by 20%. This means that in order for the wealthiest 1% of Americans to see their incomes triple, the AVERAGE working American makes $10,000. a year LESS than he/she made in 1979 (adjusted for inflation/deflation). The wealthiest 1% put their money into hedge funds, banks, financial derivatives and other globalized instruments. These were NOT real investments in hardware, they were 'bubble investments', building a gambling house of cards that came crashing down a year ago. And when these investment instruments failed, lost nearly ALL their value, what did the richest 1% do? They went hat in hand to Congress, who have paid them AT LEAST $1 TRILLION in welfare, taken from ordinary taxpayers. NOW Congress is considering a nationalized sales tax. Sales taxes are horribly regressive, they tax the poor MUCH more than the rich, as the poor must spend money on basic necessities.

The term 'privatize the profits, socialize the losses' comes to mind in considering the wealthiest 1% of Americans, where they put their money, and what has happened recently to those investments and to the nation that is now underwriting their 'value', and to the poor working SAPS who will be overtaxed to PAY that debt.

[puzzler125]

I worked at Walmart in Ohio and the national average starting salary was $8.00. I got $6.00. This was 2003 and if they lower the salaries here the economy is so going to suck lots worse. Between GM closings, and other businesses closing, there are SO many people out of work. I got laid off from a large national chain in May after going from 39hrs/wk to gradually 4hrs/wk then contingent and zero hours. I used to live in New York and can't believe the differences state to state.

[babooph]

This in a nation that gave PUBLIC $$$ for 100milion$ bonus es to crooked bankers whos failure bankrupted the business & the nation -WHAT A COUNTRY!!!The poor cannot hire a lobbyist so......

[aldon62]

Maybe I'm missing the point, but Colorado seems to have a "fairer" grasp on the minimum wage issue. Three cents isn't much, but it does reflect the true value of inflation/deflation.

[stuart-johns2]

$7.28 is above the cost of living????

The world is getting wackier by the day. I can't believe I am reading this. What a freakin' joke!

I am telling you. The terrorists are not a threat to America. An asteroid is'nt a threat nor are UFO's. Drugs are not a threat to America nor are illegal aliens. Guns are not a threat to America nor are nuclear weapons.

None of these are as much a threat to America than the rampant stupidity flourishing in this nation.