The nearly 5,000 MSU students who will work in the dorms and cafeteria this year won't be greatly impacted after the state minimum wage jumped Sunday to $7.15 per hour.
The new minimum wage, which was previously $6.95 per hour, is the second installment of a three-part increase that eventually caps at $7.40 in July 2008.
Most MSU students are paid at or above minimum wage, and the same number of employees will be hired this year compared to previous years, said Angela Brown, director of housing.
But some people wonder if the new minimum wage can make a difference in boosting Michigan's struggling economy, which has one of the highest unemployment rates in the nation.
"Economists report rising wages can stimulate economic activity throughout the state," said Megan Brown, a spokeswoman for Gov. Jennifer Granholm.
Although the increase might help those who already hold a minimum wage job, there also could be a negative effect, said Sarah Hubbard, vice president of government relations at the Detroit Regional Chamber.
"Certainly there's a market, a supply and demand issue," she said. "Employers are forced to pay more for entry level positions and wouldn't hire as much. Students work minimum wage and part-time jobs. If there are fewer jobs available - that's a problem."
Hubbard worries increased competition among states for cheaper labor could hurt Michigan's economy.
"The right place to increase minimum wage is on the federal level, so there's a level playing field across the country," she said. "If employers can get low wage work somewhere else, they'll do it."
Brown said she disagreed that a higher minimum wage could cause problems.
"Higher wages will be spent in the economy, which will ultimately increase jobs," she said.
"A number of states have increased their minimum wage, and there's no evidence that the minimum wage has eliminated jobs," she added.
Paul O'Connor, owner of Flats Grille, 551 E. Grand River Ave., said the starting wage for the MSU students he employs was already $7 per hour before the wage increase.
"It might affect the number of hours they work and the amount they have to produce," he said. "If they are paid more, they have to produce more.
"If people aren't worth that much an hour, then I don't keep them around that long anyway," he added. "Nine times out of 10, they are worth it.
"With the rising costs these days, people have to do better at their jobs to provide a valuable product for the customer."
Angie Wang, an employee at Rice Kitchen, 551 E. Grand River Ave., said although she currently makes more than the minimum wage, she is concerned that prices might increase.
"It feels like stuff will be more expensive," Wang said. "That's the thing I don't like."
