Higher minimum wage could mean higher prices

By: Diane Cho
By: Diane Cho

August 6, 2006

A raise in the nation's minimum wage could be on the way, but is it in the best interest for everyone?

News 12's Diane Cho is on your side with why more money could mean higher prices.

Supporting a family of six on $5.15 an hour is out of the question for Latosha Wright.

"It's very hard," she says.

Even though she lives in Augusta, she used to commute to Graniteville for better wages, until the plants shutdown.

"The money was higher than what they pay here," she says.

It's the hard-working Americans just like Latosha that Congressman John Barrow wants to help.

"I don't think anything shows how screwed up Congress is besides the fact that Congress gets a cost of living increase for doing nothing, while folks who work full time for a living are not able to pull their family out of poverty," Barrow says.

The US House of Representatives just passed a bill that will gradually raise the minimum wage to $7.25 an hour over the next three years.

The last increase signed into law was in 1997.

With gas prices steadily on the rise, it's a move some say is long overdue.

But is it passing the buck on to the businesses?

Master Guthrie, the owner of 1102 Bar and Grill, says an increase in wages would unequivocally mean higher prices on the menu.

"I've got a staff of 30. Paying $7 an hour, guess what? Sweet tea just went up to $4," Guthrie says. "That's the way it works."

But Representative Barrow contends businesses are already paying it.

"Most employees are paying above minimum wage because that's the market conditions," he says.

Others say it's a shortsighted solution to a long-term problem.

"That sounds great, but everything from candy bars to cars skyrocket," says resident David Ryan. "Bad deal all around."

The minimum wage bill has passed in the US House of Representatives but was defeated by the Senate. The bill may be voted on again once legislators return from session.

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