Speaking of the cost of living increase—whereby a state minimum wage is increased each year going forward to keep up with the rate of inflation in the state—as we saw in Missouri, there is some push back from employer groups and business groups against the cost of living increase in the state of Wisconsin. The head of the Wisconsin Restaurant Association has come out publicly, according to my sources, to say that he does not support any sort of cost of living increase. I guess the state of Wisconsin used to have a costs of living increase in their minimum wage bill, but they no longer do. And this fellow, the head of the Restaurant Association, obviously does not want the cost of living increase brought back into effect.
Why is he bringing this up now? Well, Sen. Russ Decker, a Democrat from Weston, Wisconsin, has introduced just such a measure into the state Senate, which would increase the state minimum wage every year going forward based on the inflationary index.
The Restaurant Association’s argument is that politicians need to take more into account in the economy than just the rate of inflation when choosing to increase the minimum wage. They point to the last time when the state of Wisconsin had the cost of living increase. Back then, the state minimum wage would go up every two years according to what the inflation index was, but then that was removed from the law in 1991 during the recession of those days.
That left the Wisconsin minimum wage at $5.15 per hour for nearly 10 years, until a couple years ago in 2005, when the state minimum wage went up to $6.50 per hour. The measure by Sen. Decker is in part a reaction to the debate going on in Congress about the federal minimum wage.
