Thu August 8, 2013
How Would Minimum Wage Increase Affect Georgia Economy?
President Obama has proposed raising the federal minimum wage of $7.25 an hour to $9 an hour by 2015. Georgia's minimum wage is below the federal level. What effect would raising the national rate have on Georgia's economy?
Even though Georgia's minimum wage is $5.15 an hour, most businesses are required to pay the federal rate.Several states have set their rates higher than $7.25. Staying on the lower end helps Georgia compete for business and investment. But Jeff Rosensweig, an economist at Emory’s Goizueta Business School, says that won’t benefit the state in the long run.
“The only solution for Georgia really is to do what you see in places like Oregon and Washington and Massachusetts, which is raise the productivity of our workers, so that firms are more than willing to invest here and hire our workers, even at a higher minimum wage,” he says.
To do that, Rosensweig says, it comes back to basics.
“As trite as it sounds, it all comes down to our education system and our training,” he explains.
Rosensweig says if the minimum wage does increase, it should be tied to the Consumer Price Index to keep up with the cost of living. That way, the rate would automatically increase without approval from Congress.
The federal minimum wage hasn’t changed since 2007.