Colorado raises minimum wage
By Chris Bonham
On January 1, the minimum wage in the state of Colorado will jump to $7.78 an hour. This new wage, which is assessed and adjusted annually to keep up with inflation, will affect nearly 80,000 Colorado workers (about 3.4% – 3.5% of the Colorado workforce).
The minimum wage for tipped employees has been increased as well to $4.76. This is the third straight year that Colorado has raised the minimum wages for both tipped and non-tipped employees. Together, these increases could have a major impact on Colorado’s economy.
The response to these increases has been rather mixed thus far. Rich Jones from the Bell Policy Center argues that, “Raising the minimum wage and adjusting it for inflation was good for Colorado families in 2006, and the policy remains good today.” Jones believes that adjusting the minimum wage for inflation is essential as America works its way out of the recession it currently finds itself in.
On the other hand, economists like Alan Reynolds from the Cato Institute believe that raising the minimum wage dramatically increases the operating costs of many businesses. This uptick in the cost of actually running a business, Reynolds argues, forces companies to cut jobs that would otherwise have been saved if the minimum wage had not been raised.
Still other economists and analysts believe that raising or decreasing the minimum wage will result in a negligible effect on the economy. However, regardless of the consequences of the decision to raise the minimum wage, one thing is for sure: New Year’s Day could very well bring economic change for many families in Colorado and the Castle Pines community.