Idaho minimum wage to rise along with federal rate

Nearly 20,000 Idaho workers will receive raises Tuesday, when the federal minimum wage increases from $5.15 to $5.85 per hour.

Few of them, however, will be in the Idaho Panhandle.

Three years of strong job growth has already bolstered the paychecks of the region’s hotel maids, retail clerks, landscape laborers and call center agents. With demand for entry-level workers on the upswing, most employers already pay more than minimum wage to attract qualified help, said Kathryn Tacke, regional economist in Coeur d’Alene for the Idaho Department of Labor.

“A few employers are trying to pay around $6 per hour,” she said. “But they’re not being very successful in getting workers.”

The short driving distance to the Washington border has also put upward pressure on wages. Eight years ago, Washington voters approved an initiative tying their state’s minimum wage to the cost of living. Washington state now has one of the nation’s highest minimum wages – $7.93 per hour – which also influences the pay scale in border communities.

Idaho is one of 21 states where the minimum wage matches the federal minimum. According to the Idaho Department of Labor, the increase to $5.85 per hour will cost employers about $12.5 million.

The federal minimum wage increase is the first of three scheduled over the next two years. The minimum wage will increase again to $6.55 an hour on July 24, 2008, and to $7.25 an hour on July 24, 2009.

Waiters and waitresses are the exception to the new federal minimum wage. Under Idaho law, they can be paid $3.35 per hour if their tips bring their overall earnings to at least minimum wage.

According to state estimates, 3.5 percent of North Idaho’s workforce currently earns less than $5.85 per hour.

Most of those jobs are in outlying, rural counties, said Dawn McLees, a state labor compliance officer.