The tiered plan will be phased in over six years and accommodate the state’s different economic regions.
The Oregon Senate Chambers. Photo courtesy of Wikimedia Commons.
On Thursday, Oregon set a national precedent, passing a bill that will raise its minimum wage to one of the highest in the country. The plan employs a novel three-tier system that addresses the cost of living in different geographic regions of the state.
The Guardian reports that the legislation will gradually raise the wage rate over the next six years and set different standards within the state depending on a region’s size and prosperity. In a major city like Portland, the rate will jump to $14.75 an hour, while smaller cities will increase their rate to $13.50, and rural areas will raise their rate to $12.50. Oregon’s current minimum wage, $9.25 an hour, is already one of the nation’s highest, making the new proposal one of the boldest advancements in the country so far. (In May, Los Angeles voted to raise the city’s minimum wage to $15 by 2020.)
“Oregon has always been at the forefront of new ideas in the country. We were the first to actually have a minimum wage,” Congressman Paul Holvey, a Democrat, said. “We’re trying to move people to where they can reach closer to that self-sufficiency.”
Objections from Republicans in the Oregon Senate echo those voiced around the country: that rising labor costs will force employers to make difficult financial decisions, such as reducing hours and laying off employees. But that will be unlikely, considering the plan’s emphasis on gradual, accommodating change.
The federal minimum is a measly $7.25 an hour—a rate that many argue is no longer enough to survive in the United States. More than a dozen other states have already raised their minimum wages. Now Oregon has introduced a new model of alleviating economic disparity that can be replicated in states where the minimum wage issue is now under debate.