Minneapolis to launch study into raising minimum wage to $12 or $15

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The City of Minneapolis has agreed to commission a study into how raising the minimum wage to $12 and $15 an hour would impact the local economy.

City leaders on Tuesday gave the go-ahead for the study, which will look at the implications of implementing a $12 and $15 minimum wage over five years in Minneapolis, as well as wider Hennepin and Ramsey counties, with it increasing with inflation from then on.

Minnesota's minimum wage rose last month to $9 per hour for large employers and will rise again next summer to $9.50, but there has been a campaign at a national level for a $15 minimum wage to raise living standards and combat poverty, with the federal level currently at $7.25.

The Star Tribune reports the study will cost $150,000 and the city is now accepting proposals for how it will be carried out, with the intention of it being completed by March 2016.

The city's attorney Susan Segal told the newspaper she is not sure whether it has the authority to set a minimum wage level separate from state law, but the Star Tribune cites precedents from others cities including New York, Seattle, Los Angeles and San Francisco that have set higher minimum wage levels than those imposed by state governments.

Twin Cities Business reports the things the study will look at will include which workers would benefit from a higher wage, potential job creation, business retention, business losses, and "unintended consequences" such as tax and benefit eligibility.

The magazine adds the push for a higher minimum wage is one of three "planks" advocated by Mayor Betsy Hodges to improve conditions for working families in the city, with the others including the implementation of mandatory paid sick leave and "fair scheduling," early drafts for which were put forward earlier this month.

There are supporters and detractors on each side of the $15 debate, with Salary.com noting supporters contend a higher minimum wage would stimulate the economy as low-income households would spend more, as well as decreasing employee turnover and keeping training costs down.

Opponents argue it would harm businesses who would be unable to handle the extra costs, particularly smaller companies. It would also affect their ability to hire more people, keeping unemployment levels high, the website says.

The Blaze meanwhile argued earlier this year that raising minimum wages for low-skilled jobs could discourage people from filling skilled positions offering a similar wage.

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