Minimum wage workers in Wallowa County and throughout Oregon will make an extra 45 cents an hour beginning Jan. 1, as the rate increases to from $7.95 to $8.40.

Oregon's minimum wage is the second highest in the nation, slightly behind Washington State's $8.55.

Two cities, however, have an even higher minimum wage. Workers in San Francisco are required to be paid at least $9.79 an hour, while minimum wage workers in Santa Fe, N.M., make $9.72.

The Oregon Bureau of Labor and Industries announced the minimum wage increase, which is tied to inflation, a few months ago. The increase translates into an extra $936 a year for a family with one full-time minimum wage worker, according to Michael Leachman, policy analyst with the Oregon Center for Public Policy.

"It's an economic stimulus for working families and Oregon," said Leachman. "It puts money into the hands of the people who are most likely to spend it, spend it quickly and spend it here in Oregon."

The adjustment reflects the rise in the cost of living as defined by the Consumer Price Index (CPI) and is mandated by ballot Measure 25. Oregon voters approved that measure in 2002, when the state was also reeling from the effects of a recession.

"Tying the minimum wage to inflation has been good for Oregon, preventing the lowest-paid workers from falling too far behind," said Leachman, adding that the industries that complained the most about Measure 25 have done well since the measure's passage.

He cited data on the restaurant industry, one with a relatively large share of minimum wage workers. Of all industries, it was Oregon's biggest job creator - producing nearly 21,000 jobs - during the economic cycle that lasted from November 2000 to February 2008, according to Leachman.

Those numbers, said Leachman, refute the claims of critics of Measure 25, including the Oregon Restaurant Association (ORA). It opposed Measure 25, stating in the 2002 Voters' Guide that the measure would lead to substantial job losses.

Recently, ORA said that it will push the 2009 legislature "to remove the annual indexing from the minimum wage," claiming that the change is needed to create jobs.

Bill Perry of the Oregon Restaurant Association said the latest wage increase may force some of the state's restaurants to lay off employees or cut hours. Many restaurants are already struggling because of the economy, he said.

Motels and hotels also are impacted by the wage increase.

With the New Year's cost-of-living adjustment, an Oregon full-time minimum wage worker will earn $17,472 next year.

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