Committee lops inflation-proofing off minimum wage

Posted: Wednesday, May 07, 2003

The minimum wage would not have to keep up with inflation under a bill that passed the House Finance Committee.

The bill that passed the committee on Monday would change a law legislators passed last year that boosted the minimum wage from $5.65 to $7.15 an hour and called for it to rise in the future with the consumer price index. That bill was intended to keep a similar citizens initiative off the ballot.

Rep. Norman Rokeberg, an Anchorage Republican, argued last year that the minimum wage should not automatically go up with inflation, and he introduced the bill this year to change the law.

He said automatic inflation-proofing will hurt small businesses, which will respond by using more technology and hiring fewer workers. He argues that most minimum wage workers are either in the hospitality industry and receive tips or in the seafood industry and receive overtime pay.

Rep. John Harris, a Valdez Republican, joined minority Democrats on the Finance Committee in opposing the bill.

Harris said since the law changed in January, it's too soon to know if the inflation-proofing requirement will be a problem for businesses.

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