Wednesday night at the University of Wisconsin Memorial Union,
the Contemporary Issues Committee sponsored a debate on the
possible increase in minimum wage in Madison. Representing both
sides of this issue, the dialogue incorporated the voices of UW
students, professor of economics Robert Haveman, Ald. Austin King,
District 8, and small-business owner Sandi Torkildson.
The goal of the dialogue was to hear both sides of the proposed
$2.60 increase in the federally mandated $5.15 minimum wage.
“The reason minimum wage is such an issue is because it is a
tradeoff,” Haveman said. He argued that despite the benefit of
higher wages to both students and members of the working class at
poverty level, the implementation of a higher minimum wage would
adversely affect small businesses in Madison, as well as create job
loss in the city.
A general theme focused on how the city thrives on differences
among its residents. According to King, the possibility small
businesses in Madison will suffer must be addressed.
“It is a complicated issue, but there is no doubt there will be
job loss … The question is how much job loss,” Haveman said.
The job loss associated with increases in minimum wage occurs
because many small-business owners, such as Torkildson, are unable
to increase employee wages while continuing to provide benefits,
such as health care and dental insurance.
Torkildson has been owner and operator of the Madison bookstore
A Room of One’s Own, 307 W. Johnson St., for 29 years and said this
wage increase would indeed negatively affect her business.
A minimum-wage increase would affect the working class and
businesses differently. According to Haveman, large chain
businesses would be able to combat the negative effects of the wage
increase much more easily than a small business would.
Some part-time and student workers will benefit immediately from
the wage raise, while those at the poverty level may find jobs
frozen.
Despite possible negative effects of a minimum-wage increase,
studies of the living wage in Madison have found that in 2003,
people living at the poverty level need to make $9.57 an hour to
survive. King and other advocates said the current $5.15 wage and
the possible $2.60 increase do not reach close enough to the
necessary amount.
“Students need this money; poor people need this money,” said UW
senior and co-chair of the Poverty Action Network Katie Ray.
Supporters of the wage increase say they have solid grounds to
fight. Madison is one of the more expensive places to live in
Wisconsin based on transportation and housing alone, according to
The Capital Times.
“No one can survive on $5.15. No one in the city can survive on
that. Five dollars and 15 cents is an economic anachronism,” King
said.
Activists promoting the legislation, such as the Madison Fair
Wage Campaign, hope to have 12,800 petition signatures of local
Madisonians in seven days to support the minimum-wage increase.
This petition will ask the City Council to implement the increase
in Madison.
However, some believe a wage increase is not the answer. “[An
increase] does not effectively fix problems,” said UW senior Peter
McCabe, Upper Midwest chair of Committee for a Constructive
Tomorrow.
In the short run, the $2.60 raise will not solve all of the
city’s problems with low-income workers, despite granting a higher
pay to some. The long-term effects of the wage increase will hurt
productivity, Haveman said.
Yet, supporters of the petition agree that some help is better
than none at all.
“No one is saying [the minimum-wage increase] will solve
problems completely,” Ray said.