Minimum wage proposal could go to voters

MAT-SU — A petition recently endorsed by Gov. Tony Knowles may have negative implications for some local business owners.

Knowles recently was first in line to sign a minimum wage petition sponsored by the AFL-CIO, which seeks to put a $1 per hour minimum wage hike on the 2002 ballot.

Alaska's minimum wage, $5.65 an hour, is the lowest on the West Coast, according to information from Knowles. During the legislative session, Knowles sponsored legislation that would raise the minimum wage to $6.40 this year, and $7.15 the following year, while tying future increases to cost-of-living increases.

The bill stalled in the Legislature, but this petition mirrors Knowles' bill and would essentially circumvent the Legislature and place the matter in the voters' hands.

Some Valley business owners see the petition as a non-issue. Traditionally, minimum wage hikes have affected industries such as agriculture, fishing and other typically low-paying service positions. With a tighter job market,

however, that may not be the case with this proposed hike.

Larry DeVilbiss, a local farmer and member of the state board of the Farm Bureau, said those who work on his and other commercial farms in the Valley are already receiving wages well above minimum wage simply because the job market is tight.

"Just in the last year, we've had to go up 25 percent, just in our labor expense," DeVilbiss said. "Where we were paying $6 before, we're paying $8 or more now, just for laborers."

The increase in wages has come as a result of a changing economy, DeVilbiss said, and that's where he would rather see it stay.

"It's just one of those things I'd just rather see the marketplace take care of," DeVilbiss said.

While having a bottom in the market seems like a good thing, DeVilbiss said, it could end up hurting business owners and workers in the future if the unemployment rate skyrockets and, because of high wages, business owners are unable to absorb the influx of workers.

It may make people in his position spend the money on a machine that could do the work of a few people instead of giving those people jobs and running a business into the ground, he said.

Those who work in the service industry aren't necessarily gung-ho for the petition either.

Kyle Yost, who works at Mom and Pop's Grocery, said although he doesn't make minimum wage, ripple effects of the hike may be beneficial for the short term, but wouldn't matter much in the long term.

"I sure could afford a lot better stuff," Yost said with a laugh. "[But] it doesn't really make much difference anyway — it just seems that when the minimum wage goes up, prices go up. A year down the road, it ain't gonna help that much."