Blunt says ballot proposal to boost minimum wage could harm economy

JEFFERSON CITY, Mo. -- Gov. Matt Blunt says a November ballot proposal to boost Missouri's minimum wage could harm the economy and make it more difficult to recruit businesses to the state.

If approved by voters, the proposal would raise Missouri's minimum wage from the current federal level of $5.15 to $6.50 effective Jan. 1. The wage rate would automatically rise each year thereafter to keep pace with inflation.

"I think it would be harmful to job growth and economic development in the state," Blunt said Friday.

His comments come after the secretary of state's office certified Tuesday that the initiative had received enough petition signatures to qualify for the Nov. 7 election.

On Wednesday, Blunt began running television commercials touting his accomplishments in office -- among them, the creation of nearly 45,000 new jobs.

One of the Republican governor's main goals in his first year-and-a-half in office has been to create a more business friendly climate in Missouri. He has signed laws imposing new restrictions on liability lawsuits and workers compensation claims, as well as a law offering new cash incentives for business that create decent-paying jobs that come with health insurance.

"I do think we've made significant improvements in the jobs climate, and this would be a setback," Blunt said. "It would make it more difficult to bring new employers to Missouri."

He doesn't try to recruit businesses paying the minimum wage, Blunt said, but even higher paying companies "see that as a sign of a bad business climate when there's a state minimum wage that differs from the federal minimum wage."

Efforts to raise the federal minimum wage have failed so far in Congress.

That is precisely why it is important for Missouri to raise its minimum wage, said Sara Howard, a spokeswoman for Give Missourians a Raise, the group supporting the ballot measure.

Twenty-two states and the District of Columbia already have approved minimum wages above the federal level, Howard said. That includes two of Missouri's eight neighboring states -- Illinois and Arkansas.

The last federal wage increase occurred in 1997.

"People across the country have realized that after nine years, we've been waiting too long for the federal government to raise the minimum wage," Howard said.

Howard also disputed Blunt's assertion the ballot measure would hurt the economy.

She pointed to the measure's financial estimate approved by State Auditor Claire McCaskill's office based on information supplied by the budget office in Blunt's administration. While citing the potential for job loses and decreased business investment as a result of the wage increase, the document also projects $21.4 million in new consumer spending.

The financial summary on the ballot estimates the minimum wage increase will generate an additional $3.3 million to $4.3 million annually in state tax revenues.

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Blunt: http://www.gov.mo.gov

Minimum Wage: http://www.givemissouriansaraise.org