Arizona would have a minimum wage under a proposed voter initiative launched by a Tucson-based group.

Five Fifteen Isn’t Working filed its proposed constitutional amendment (serial no. C-01-2006) on Jan. 5 with the Arizona Secretary of State’s Office.

The measure proposes to raise the minimum wage in the state to $5.95 an hour on July 1, 2007, and to $6.75 an hour on July 1, 2008. Increases would be indexed to the Consumer Price Index thereafter. The federal minimum hourly wage is set at $5.15; Congressional action is required for any change.

“The current federal minimum wage went into effect in 1997,” said Bob Schwartz, an attorney and chairman of Five Fifteen Isn’t Working. “If you look at the history going back more than 50 years, it’s at its lowest level ever when you take inflation into account.”

The group will have until July 6, 2006, to collect a minimum of 183,917 valid signatures of registered voters to get the measure on the next general election ballot in November 2006.

A news release from Five Fifteen stated the group hopes to collect as many as 500,000 signatures. The group also is seeking to raise $5 million to promote the initiative.

The initiative proposes to add the minimum wage requirement to the Arizona Constitution. Mr. Schwartz said he isn’t concerned that the higher threshold of voter signatures — 183,917 for a constitutional amendment vs. 122,612 for a statutory change — will be an impediment to getting the measure on the ballot.

Mr. Schwartz said adding the minimum wage to the Constitution requires only about one page of text versus at least 10 for a statutory change.

“The simplicity of [a constitutional amendment], I think, will make it easier to understand,” Mr. Schwartz said. He said he took a cue from backers of a similar measure in Florida that added the minimum wage to that state’s Constitution.

Mr. Schwartz said he also is heartened by the fact that voters in Florida and Nevada recently “overwhelmingly” approved minimum wages in their respective states, even though the Republican Party and business interests dominate those states. Florida voters approved a minimum wage initiative by 71.3 per cent, while 68.3 per cent of Nevada voters approved a minimum wage for their state. Each state set the minimum wage at $6.15 an hour, to be indexed for inflation annually.

“We can get a majority of the voters in Arizona to vote for it,” Mr. Schwartz said. “The president got 51 per cent of the vote nationwide and won by even bigger margins in Florida and Nevada, but big majorities of voters in those states also voted for the minimum wage increases. Minimum wage affects working families, even those who supported the president.”

Although business groups have long complained that a minimum wage actually leads employers to cut jobs or defer new hiring, Mr. Schwartz said, a 1994 study by two economists, David Card of the University of California Berkeley and Alan B. Krueger of Princeton University, found that New Jersey’s enactment of a minimum wage in 1992 that was higher than the federal minimum had no detrimental effects on employment in the fast-food business.

Goldwater Institute: Wage Raises Cost Of Doing Business

But Andrea Woodmansee, director of communications for the Phoenix-based Goldwater Institute, said that a fundamental misperception about a minimum wage is the assumption that labor and business are disconnected from one another.

“In reality, they’re part of the same market,” Ms. Woodmansee said. “When you raise the minimum wage you’re raising the cost of doing business. It typically raises the cost of a product, while those who earn the lowest wages in the company are the ones mostly likely to be laid off in cost-cutting.”

Lower-wage earners are the people who most often consume the products of lower-wage earners, Ms. Woodmansee said. “So in the long-run, it’s not only costing jobs but it’s raising the cost of living for lower-wage workers.”

Farrell Quinlan, vice president for communications and federal affairs with the Arizona Chamber of Commerce, said, “We’re not going to be encouraging our members to sign that petition.”

‘Training Wage’

Companies typically look at the federal minimum wage as a “training wage,” or one that is the starting pay for new employees. Once a company decides to keep an employee past a training or probationary period, the wages often rise above the minimum, Mr. Quinlan said.

“Instituting a minimum wage higher than the federal minimum makes it that much harder for companies to bring on new employees, even if the workers move quickly in a higher wage,” Mr. Quinlan said. With a higher minimum wage, “if you had eight positions to fill you may decide you can only fill six of them.”

“A higher minimum wage also certainly impacts our ability to attract companies,” Mr. Quinlan said. “I wouldn’t say that it’s absolutely a deal-killer, but it’s one more issue we don’t have to explain to companies looking to move into the state.” —