WASHINGTON The National Restaurant Association voiced its frustration with the federal minimum wage increase passed Thursday by Congress, asserting that the measure, a provision of the controversial $120 billion Iraq spending bill, “was entirely out of place” in the debate over war funding.
In addition, the Washington, D.C.-based trade association said it was disappointed the $4.9 billion tax package also included in the bill did not contain more relief measures for restaurant operators. While the White House had pushed for additional tax breaks to help offset the wage hike’s impact on small businesses, President Bush nevertheless is expected to sign the bill.
This marks the first increase in the federal minimum wage since Sept. 1, 1997, during the Clinton administration, when it rose from $4.75 to $5.15 an hour.
The legislation will increase the minimum wage to $7.25 over a two-year period. It will rise to $5.85 by the end of this summer, and then by another 70 cents in 2008. It will rise a final 70 cents by the summer of 2009.
Currently, 28 states and the District of Columbia have a higher minimum wage, and several of the states have indexed the hourly wage to inflation.
The Economic Policy Institute, a Washington, D.C., research group, estimated that the hourly wage increase will affect about 5.6 million workers who currently earn less than $7.25 an hour.
The NRA said the last minimum wage hike in 1997 cost the foodservice industry 146,000 jobs and restaurant operators postponed plans to hire a further 106,000 workers.
The measure passed in the House by a vote of 348 to 33, and in the Senate by 80 to 14 votes.