United States Wages And Salaries

President Clinton signed minimum wage legislation Tuesday that will give the lowest-paid 11% of the American work force a raise of 90 cents an hour. In the first of three bill signings in his pre-convention week, Clinton called the measure "pro-work, pro-business and pro-family." Evoking a venerable Democratic tradition, he fixed his signature in a South Lawn ceremony on the desk used by Frances Perkins, President Franklin D. Roosevelt's labor secretary.

In a compromise, key House and Senate negotiators agreed Wednesday on a bill that would raise the minimum wage while also providing $9 billion in tax breaks for small businesses, allowing homemakers to establish tax-sheltered individual retirement accounts and offering a $5,000 tax credit for adoption expenses. The agreement clears the way for Congress to enact a two-stage, 90-cent-an-hour increase in the minimum wage before lawmakers leave for a monthlong summer recess at the end of the week.

For years, conservative economists and political leaders have derided as a statistical illusion the argument that middle-class workers, particularly those without college educations, are facing downward pressure on their living standards. Suddenly, however, the Republican presidential contenders have reversed field and are vying to propose solutions for a problem their party had long insisted did not exist.

Despite a growing economy that held down the unemployment rate and boosted the stock market throughout 1995, American workers received historic low pay and benefit increases averaging only 2.9% last year, the U.S. Labor Department reported Tuesday. The narrow yearlong gain, which overshadowed an upward spurt in the last quarter of 1995, was down from 3% in 1994 and the smallest advance since the government began compiling its employment cost index in the early 1980s.

The White House said Tuesday that 68% of recently created jobs are in categories that pay in the top half of the wage scale, an upbeat report that nonetheless underscored the election-year pitfalls facing the Clinton administration on jobs and the economy. The analysis, released by the White House Council of Economic Advisors, found that most of the jobs are in professional and managerial fields rather than service or part-time occupations.

Seeking to rebut complaints that workers' well-being is eroding as companies downsize and boost profits, the nation's biggest manufacturing trade group released a study Thursday that maintains workers are better off than they think. Conventional wisdom says that today's workers are suffering from wage stagnation and job losses, but the National Assn. of Manufacturers says its study found there has actually been significant growth in employment and real wages since the late 1970s.

Americans' incomes and spending both posted healthy increases in November, but even with that good send-off for the Christmas sales season, actual results appear to be falling short of retailers' hopes. The Commerce Department reported Monday that personal incomes rose 0.5% last month, a solid rebound after showing no gain in October, while consumer spending was also up 0.5%. The spending increase followed a 0.7% rise in October.

The House, acting quickly on one of the most important small business issues pending in Congress, passed a bill Tuesday allowing employers to give their employees paid time off instead of overtime pay. The 225-195 vote was almost strictly along party lines, with Republicans arguing that it will help workers and Democrats warning that the measure could lead to abuse by employers.

When President Clinton recently proposed that companies offer paid "flex" time to nonexempt workers in lieu of overtime pay, he dived into a raging nationwide debate that could lead to dramatic changes in the nation's Depression-era work laws. The federal law, devised when Congress was scrambling to find ways to get people back to work and protect them from workplace abuses, has been changed only grudgingly since the 1930s.

The Senate voted Tuesday to give the nation's lowest-paid workers a 90-cent raise over the next two years, resolving an election year standoff in which leaders of the Republican majority found themselves on the losing side of public opinion. By a lopsided 74-24 vote, the Senate approved a two-step increase in the federal minimum wage, first from $4.25 an hour to $4.75, and a year later to $5.15.