While the federal minimum-wage is $7.25 , Oregon’s minimum wage is over a dollar more and is rising this January. Oregon’s minimum-wage will increase ten cents on January 1, 2011, from $8.40 to $8.50 , and minimum-wage earning student workers and campus business owners are reacting with mixed emotions.
Students working for minimum-wage will benefit from the minimum-wage increase in January, but owners of businesses on-campus with employees receiving minimum wage will have to adjust financially. Currently, Oregon has the second highest minimum-wage in the nation. Washington has the first, at $8.55 , and will announce changes to its minimum wage Thursday.
Alexandra Sianis, the owner of local restaurants Sunset Island Cafe  and World Flavors , said she was slightly dismayed to hear about the wage increase from her accountant.
“These are very impactful,” Sianis said. “You unfortunately end up having to raise the prices of your product to compensate. If people don’t feel like they can raise prices, like, for example, in this type of bad economy, then they staff less employees, and then each person has to work more and customer service is not as good. So it has to come out somewhere.”
Despite the impact she felt the upcoming wage raise would have on her businesses, Sianis said she fully understood the necessity of an adequate living wage- just not at such an expense to the business. She said the upcoming 10-cent wage increase paled in comparison to 45-cent increase of two years ago, from $7.95 to $8.40, which she described as “very critical.”
Sianis worried the minimum wage versus inflation debate was a “catch-22,” because as inflation in Oregon increases, so does the minimum wage, and in response to this, businesses like Sianis’ inflate their prices.
“I would be in favor of the service industry people, the servers and the people who make tips, to make a lower wage,” Sianis said. “While cooks, who don’t make tips, I’m totally in favor of paying them a higher wage.”
Back in 2002, voters approved a law that requires the commissioner of the Bureau of Labor and Industry to annually adjust the minimum wage in accordance with Oregon’s U.S. Consumer Price Index measure, an indicator of inflation . The annual adjustment is calculated every September, rounded to the nearest 5 cents and becomes effective the following January. Last year there was no increase because the consumer price index didn’t increase.
Legislation has been proposed to make the adjustment that Sianis describes, but Democrats, including John Kitzhaber, have defended the 2002 law approved by the electorate, which mandates the minimum-wage floor to adjust with inflation.
Republicans such as gubernatorial candidate Chris Dudley have criticized the minimum-wage increase.
“…(H)aving the highest minimum wage in the country negatively impacts the state,” Dudley said in a campaign video.
University junior Katie Bark, who earns minimum-wage working at the Union Market, said she was excited about the pending increase in her wages, but that the 10 cents an hour more didn’t mark significant change for her.
“I was doing fine. It’s not life-changing,” Bark said. “But yeah, it’s good news.”
University junior Yan Zhang, who works at the DUX Bistro, felt differently than Bark, saying that the current minimum-wage was not sufficient for him to live on and that he needed outside sources of income to afford life as a student in Eugene.
“My parents have to send me money,” Zhang said. “Living wage here is not enough to pay for rent, electric, phone and food.”
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