Talk of a hike in minimum wage has some worried - KSWO 7News | Breaking News, Weather and Sports

Talk of a hike in minimum wage has some worried

LAWTON, Okla._In his State of the Union address Tuesday, President Obama urged congress to push forward with increasing the federal minimum wage.

He already said he plans on increasing the minimum wage for federal contract workers. The proposed wage is $10.10, easy to remember but it has started some heated discussions about whether America needs another increase.

Shocking number here, in 1963 the minimum wage was $1.25 and if the minimum wage matched inflation rates, the wage today should be $10.74.

President Obama urged Congress in 2009 to raise the minimum wage to $9.00. He is still at it given his words at the State of the Union address on federal contract workers.

"In the coming weeks I will issue an executive order requiring federal contractors to pay their federally funded employees a fair wage of at least $10.10 an hour," proclaimed President Obama.

Some aren't happy about improving wages for workers fearing that it will hurt small business.

"The purpose of minimum wage is entry level, and if you place a federal mandate on us across the board then small business won't be able to keep up," said Angela Ellis, Small Business Management Coordinator.

And yes, small businesses may have to hire fewer workers or even let some go but that can be a good thing according to Professor of Economics Dr. Ahmed.

"But when they hire fewer workers they will hire more productive workers who deserve this higher pay wage," said Dr. Ahmed

Paying a higher wage helps productivity, it's all about incentive.

"It will increase the productivity of the pool of workers who are working," said Dr. Ahmed

The workers that aren't productive will lose their jobs and that gives them a chance to go back to school.

"For low skill people who are turned away from the market to go back to school and do something about it. So they are proactive about it, going back to a technical college," said Dr. Ahmed

Gaining a skill that could put them back into the job market at an even higher wage. Those against the increase say the cost of living could soar with a rising minimum wage.

"How does that help the economy? You're still going to have to increase fuel, increase groceries, and daycare,"

Dr. Ahmed believes that people will be able to take their extra money and put it back into the economy. It would take a couple of years for the market to balance out. There wouldn't be any really large increase in the prices of goods and services. The U.S. minimum wage is lower than Germany, France, and several other European countries.

There is no timetable for when Congress may try to push this though. President Obama has hinted that he may do it himself through executive order.

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