The minimum wage in Montana will increase from $7.25 per hour to $7.35 per hour on Jan. 1, officials said Friday.

State law requires an adjustment to the minimum wage to be calculated no later than Sept. 30, of each year, said Labor Commissioner Keith Kelly.

Initiative 151, enacted by Montana voters in 2006, proposed raising the state’s minimum wage to be the greater of either the current state or federal minimum wage.  It also added an annual cost-of-living adjustment to the state minimum wage.

The increase in the minimum wage is based upon any increase in the U.S. City Average Consumer Price Index for All Urban Consumers for All Items (CPI) from August of the preceding year to August of the year in which the calculation is made.  This amount is to be rounded to the nearest 5 cents.

Jon Bennion, government relations director for the Montana Chamber of Commerce, said his organization believed there were flaws in how the increases were decided.

“I think the main concern we have is that all of these increases are on auto pilot and they’re tied to a price index that doesn’t use any data from Montana,” Bennion said. He noted the wage doesn’t go down if deflation occurs.

He added the timing was bad considering the downturn in the economy.

“I believe most of our members pay more than minimum wage but certain industries will be more affected by it,” he said. ” And when coupled with recession, it does not do good things for job creation.”

For more information, go to: www.mtwagehourbopa.com