Employers urged to prepare for upcoming minimum wage increase

Employers should be preparing now for the upcoming wage increases that will become effective at the end of July, with additional increases over the next two years.

For some employers, these increases could play a major roll in budgeting strategies that need to be considered, especially for those in the food preparation or other service related areas.

In May 2007, Congress approved the first increase in the federal minimum wage in nearly a decade, voting to boost wages for America's lowest-paid workers from $5.15 to $7.25 an hour over the next two years.

According to the Bureau of Labor Statistics, about 1.7 million workers, or 2 percent of the hourly workforce, were earning $5.15 an hour or less last year. About half were under age 25, and nearly three-quarters were employed in food preparation or other service jobs.

Workers would get their first raise, to $5.85 an hour, 60 days after the measure was signed by President George W. Bush. A year later, the minimum wage would rise to $6.55 an hour, and it would hit $7.25 a year after that.

The increase is scheduled to go into effect on July 24, 2007.