Governor proposes $6.75 minimum wage

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(Host) Governor Jim Douglas says he’ll urge the Legislature to increase the state minimum wage when lawmakers return to Montpelier next week. But some business groups say they’ll actively fight the plan.

VPR’s Bob Kinzel reports:

(Kinzel) According to the governor, the passage of his jobs initiative is one of his major priorities for the current legislative session. As part of that economic package, Douglas wants to boost the state minimum wage by 50 cents an hour, from its current level of $6.25 an hour to $6.75 an hour. Douglas also wants to index the state minimum wage to the cost of living so that the rate will keep pace with inflation in the future.

The governor says his jobs package is designed to create good paying jobs across the state, but he also feels it’s critical to make certain that lower wage workers are not ignored:

(Douglas) “During the past decade, the average income of Vermonters has declined from 87% of the national average to 81%. It’s very important to me that we not only create more jobs in Vermont, but better paying jobs. We need to be sure Vermonters can have the resources they need to feed themselves and their families and afford a place to live and provide the necessities of life. And I really believe that a minimum of $6.75 is very, very reasonable.”

(Kinzel) Douglas says the indexing provision of his plan will be good for workers and businesses:

(Douglas) “Currently businesses don’t know what to expect when the Legislature is meeting from year to year. But if they could be assured that it would increase at the rate of inflation, which is a relatively predictable amount year to year, I think that would be a real plus.”

(Kinzel) One business group says it strongly opposes the wage increase. Will Adams, who represents the National Federation of Independent Businesses, says the plan may force some of its members out of business:

(Adams) “The fact is our small businesses are facing double-digit increases in workers’ comp rates. They can’t afford health insurance for themselves or for their workers and with the economy as soft as it is right now, we just don’t know where these small businesses are going to get the money to pay for this mandated wage increase.”

(Kinzel) Adams says the plan to index future increases in the minimum wage rate is very troublesome because it will place new inflationary pressures on many small businesses.

For Vermont Public Radio, I’m Bob Kinzel in Montpelier.

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