Annual Indexing of the Minimum Wage

Background

In November 2002, voters passed Measure 25. This measure raises the minimum wage each January 1, forever. In 1996, voters passed a similar initiative, Measure 36. Subsequently, the state suffered price inflation increased unemployment rates, and escalating hunger rates.
Oregon has one of the highest unemployment rates in the nation and voters have once again decided to raise the minimum wage – this time, forever. During the 2003 Legislative session, HB 2624, which would have repealed the index of the minimum wage, passed the House 35-24. A similar bill, HB 2331, was introduced during the 2005 session but was did not pass either chamber.

Issue

Oregon voters narrowly passed Measure 25 in 2002 by a margin of just over one percent. This measure increased Oregon’s minimum wage to $6.90, effective January 1, 2003, and is indexed for an annual increase regardless of the state’s economic health. Oregon’s Minimum wage is currently at $7.95 an hour, making it the second highest minimum wage in the nation.

Within the restaurant industry, the only employees considered minimum wage employees are entry-level employees still living at home and tipped employees making – with tips – well over the minimum wage. None of the minimum wage proposals introduced by advocates have even attempted to address either one of these issues.

ORA Position

The Oregon Restaurant Association (ORA) supports efforts to remove the annual indexing until the economy stabilizes and the state’s unemployment rate declines from one of the highest in the nation. ORA is opposed to any increases in the minimum wage that do not take into consideration the effects on entry level or tipped employees.