Minimum wage is going up

For low-wage workers, the increase is a welcomed move. A single mother of four, Lazondra Broughton makes $7 an hour at a Chester's chicken/Blimpie sub shop combo in downtown Atlanta.

She's thankful for the extra money coming this week, but it's not enough for hard-working employees, Broughton said. She still needs welfare to make ends meet and also is looking for a second job.

"It's okay, but it could be better," Broughton said about the minimum wage hike. "It could be more."

For restaurant owners, the minimum wage increases have been a major topic of concern. Across the United States, food preparation and service jobs make up the largest job category earning this wage, accounting for 53 percent of minimum wage workers.

Restaurant owners would rather not have the increase, said Ron Wolf, chief executive officer of the Georgia Restaurant Association, which has 3,400 restaurant members. They would rather have market conditions set the wage, he said.

With graduated increases over three years, most restaurants have prepared for the increase, but the recession makes the timing of this increase more difficult to handle, Wolf said. Many restaurants already are dealing with a decline in customers, increases in food costs and rising gas prices, he said.

The wage increase alone likely won't put a restaurant out of business, Wolf said. "But added to all the other factors we're facing in this economy, that's the unknown," he said.

Chick-fil-A, an Atlanta-based chain with more than 1,400 outlets, won't have to resort to job cuts because of the increase, said Chick-fil-A spokesman Don Perry. Minimum wage is often an entry point for hiring and many workers move beyond it as they gain more experience, he said.

"We're not looking at this as something that's going to be unmanageable," Perry said.

Chick-fil-A, though, could have a small price increase to make up for the combination of higher food costs, wages and gas prices, Perry said. It would be "cents on a sandwich," he said.

"I think the customers understand you have to recover some of the costs to stay viable," Perry said.

Atlanta-based Wendy's/Arby's Group, the third-largest U.S. fast-food company, said its brands have been preparing for the change since the initial increases passed.

"We regularly review labor and other costs associated with operating our restaurants to create added efficiencies," said company spokesman Bob Bertini.

Wendy's/Arby's declined to provide details about the impact on pricing or jobs. "Added pressure on labor costs in our restaurants always requires us to consider every option, and we will analyze the effects of this latest minimum wage increase over time," Bertini said.

Historical minimum wage

The federal minimum wage started in 1938 with the Fair Labor Standards Act.

Inflation

Date Actual adjusted

Oct 24, 1938 25 cents $3.82

Oct 24, 1939 30 cents $4.66

Oct 24, 1945 40 cents $4.79

Jan 25, 1950 75 cents $6.71

Mar 1, 1956 $1.00 $7.93

Sep 3, 1961 $1.15 $8.30

Sep 3, 1963 $1.25 $8.81

Sep 3, 1964 $1.15 $8.00

Sep 3, 1965

$1.25 $8.56

Feb 1, 1967

$1.40 $9.04

Feb 1, 1968

$1.60 $9.92

May 1, 1974

$2.00 $8.75

Jan. 1, 1975

$2.10 $8.42

Jan 1, 1976

$2.30 $8.72

Jan 1, 1978

$2.65 $8.77

Jan 1, 1979

$2.90 $8.62

Jan 1, 1980

$3.10 $8.11

Jan 1, 1981

$3.35 $7.95

Apr 1, 1990

$3.80 $6.27

Apr 1, 1991

$4.25 $6.73

Oct 1, 1996

$4.75 $6.53

Sep 1, 1997

$5.15

$6.92

July 24, 2007

$5.85 $6.07

July 24, 2008

$6.55 $6.55

Friday

$7.25

Source: U.S. Department of Labor, Inflation adjustments represent equivalent buying power in 2009 dollars based on the Consumer Price Index.

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