Oregon minimum wage up 30 cents to $8.80

State Labor Commissioner Brad Avakian announced Thursday that Oregon’s minimum wage will rise to $8.80 per hour next year.

The 30-cent increase mirrors a 3.77% increase in the Consumer Price Index since August 2010.

Oregon’s minimum wage rate remains $8.50 per hour for all hours worked in 2011. Washington, where the minimum wage is currently $8.67 per hour, will announce its 2012 minimum wage on September 30th.

“Safeguarding the wages of low-income workers is especially critical in a tough economy,” Avakian said. “Oregon’s economy will not rebound if we allow 144,538 minimum wage earners to fall behind inflation.”

Ballot Measure 25, enacted by Oregon voters in 2002, requires a minimum wage adjustment annually based on changes in inflation as measured by the Consumer Price Index (CPI). The Commissioner of the Bureau of Labor and Industries (BOLI) is directed to adjust the minimum wage for inflation every September, rounded to the nearest five cents.

“During my tenure, BOLI has fought to return nearly $12 million to Oregonians unfairly denied their wages or faced with discrimination,” Avakian continued. “Thousands of Oregon families are fighting to keep food on the table and a roof over their heads by working full-time at minimum wage jobs and this agency is committed to defending their wages.”

Oregon is one of ten states, with Washington, Vermont, Ohio, Nevada, Montana, Missouri, Florida, Colorado, and Arizona, that annually adjusts the minimum wage based on inflation and the CPI.

The CPI, published by the United States Bureau of Labor Statistics, is a measure of the average change in prices over time for a fixed “market basket” of goods and services, such as food, shelter, medical care, transportation fares and other goods and services people purchase for day-to-day living.

“Oregonians recognize the rising cost of living facing every one of us, and our strong minimum wage law is essential insurance that Oregon workers and their families can maintain their purchasing power and continue to contribute to our local economies,” said Avakian. “At the same time, although five out of six Oregon employers don’t offer minimum wage jobs, I know that it’s important to continue my dialogue with the businesses, many of them small operations, that do. Understanding their challenges will benefit our entire economy.”

Revised minimum wage posters reflecting the new rate will be available for free download from BOLI’s website in December. That site, which includes additional information about all of BOLI’s activities, is http://www.oregon.gov/BOLI.

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News release from Oregon Center for Public Policy:

Oregon’s 30-Cent Minimum Wage Hike Will Help Workers and Economy

Oregon’s 30-cent hourly wage increase for its lowest paid workers next year will be “good for workers and Oregon’s economy,” according to the non-partisan Oregon Center for Public Policy.

Oregon’s minimum wage will rise from $8.50 to $8.80 on January 1, 2012, the Oregon Bureau of Labor and Industries (BOLI) announced today. The adjustment, mandated by a ballot measure approved by voters in 2002, reflects the rise in the cost of living as defined by the August Consumer Price Index (CPI), which jumped 3.8 percent from a year ago.

OCPP calculated that the increase means an extra $624 a year for a family with one full-time minimum wage worker.

“The minimum wage increase is good for workers and Oregon’s economy,” said OCPP executive director Chuck Sheketoff. “It helps the lowest-paid workers make ends meet, and it helps the economy when the workers spend those extra dollars in local businesses.”

Oregon’s current minimum wage is the nation’s second highest statewide minimum wage, trailing only Washington state’s $8.67 minimum hourly wage. Sheketoff said he expected Oregon’s northern neighbor to retain the top spot next year, because it also pegs its minimum wage to inflation. Washington will announce any change to its minimum wage later this year.

Oregon is one of 18 states plus the District of Columbia that have a minimum wage above the federal minimum wage of $7.25 per hour, which is not scheduled to increase.

In 2012, when the 30-cent Oregon minimum wage increase takes effect, full-time minimum wage workers in Oregon will earn $3,224 more than their counterparts in those states where the federal minimum wage sets the floor.

But even though Oregon’s minimum wage is second-highest in the nation, it is not enough to prevent poverty among some working families, Sheketoff said. He noted that at $8.80 an hour, an Oregon full-time minimum wage worker will earn $18,304, still below the 2011 federal poverty guideline for a family of three ($18,530). These families could fall further behind in early in 2012, when the federal government likely will raise the poverty guideline.

The Oregon minimum wage, however, does lift one- and two-person families out of poverty.

“Oregonians were smart to raise the minimum wage and keep it from being eroded by inflation,” Sheketoff said. “Oregon’s minimum wage system helps fight poverty and income inequality and is a model for the nation.”

The Oregon Center for Public Policy is a non-partisan research institute that does in-depth research and analysis on budget, tax and economic issues. The Center’s goal is to improve decision making and generate more opportunities for all Oregonians.