Minimum wage workers see a pay hike in Las Cruces

The new year means more money for many minimum wage workers in Las Cruces.

On January 1st, the rate increased from $7.50 to $8.40 per hour. Employees who work off tips will see their pay go from $2.13 to $3.36 per hour.

Some local business owners are anticipating the increase, while others say they may have to raise prices or cut back on hours.

During a bitter debate in early December, NMSU Economics Professor Chris Erickson explained the wage hike may not impact the community dramatically.

“Higher minimum wage that workers are earning will go back into the economy. And that’s one of the ways raising the minimum wage will not impact the economy. It’s because of what economists call the ‘income effect.’ The higher incomes lead to more consumer spending and it leads to more business for local business people,” Erickson said. “On the other hand, higher wages also means that labor is more expensive and that gives business people less incentives to hire more workers. And so those two effects seem to offset each other – at least that’s what the historical record indicates.”

In early December, councilors approved two more wage increases: the rate will go to $9.20 in 2017, and $10.10 in 2019.

In 2015, 21 states are implementing minimum wage hikes. The Economic Policy Institute says the pay increases will affect about 2.4 million employees.

In some states, such as Massachusetts and Minnesota, it’s a fairly big pay bump — $1 per hour. In Florida, though, minimum wage workers will only see an increase of 12-cents per hour.

Neither Texas nor New Mexico are enacting minimum wage hikes statewide.