Despite concerns that the new federal minimum wage increase will jeopardize job opportunities for college students, local businesses said State College won't be affected.

On Jan. 10, the U.S. House of Representatives approved the Fair Minimum Wage Act of 2007 by a vote of 315 to 116, according to the Associated Press. The law aims to raise the minimum wage to $7.25 over a two-year period. The move came less than two weeks after Pennsylvania raised the state's minimum wage from $5.15 for the first time since 1997, when the federal government raised it from $4.75, according to the U.S. Department of Labor.

"There are markets where you would have a problem. State College just is not one of them," Penn State professor Robert Drago said.

Drago, who teaches labor studies and women's studies, said increasing labor costs will increase prices for some products, but the change will barely be noticeable in most cases.

Teresa Sparacino, Downtown Improvement District director, said she assumed most area businesses were already paying employees above the minimum wage before the recent increase.

She said most Penn State students work at jobs that require little training, such as at clothing stores and fast food restaurants.

Bruce Fowler, owner of Fresh Harvest Kafé, 421 E. Beaver Ave., said the wage increase will not affect his hiring practices, but it will eventually raise the prices of his products.

"We already paid way above minimum wage, even for starting wages," he said.

The Fresh Harvest Kafé employs mostly part-time college and high school students, Fowler said. He added the increase in labor costs has a chain effect, increasing prices for all the ingredients his business purchases externally.

"In the short term, it will not be noticeable, but over the next couple of years, prices will definitely go up," he said.

Fowler said most businesses in State College will feel the same effects.

"There's a group of us in the same boat," he said.

Caroline Mangam, manager of The Family Clothesline, 352 E. College Ave., said her business would not change its hiring practices or prices.

"We have always paid above the federal minimum, and our budget is already set, so the change will not affect us whatsoever," she said.

Mangam said the possibility of external price increases is a minor detail that her store will adjust to without increasing its own prices.

"This change is long overdue," she said.

Drago said the wage hike would actually benefit the area because so many college students are working for minimum wage.

"There are a lot of students working minimum wage jobs and barely scraping by," he said. "This will be a big improvement."

He added that he is glad the law was passed on the federal level because it creates an even playing field for economic competition between states. He said he is disappointed, however, that it took Congress this long to review the laws.

"The real shame is letting minimum wage sit at $5.15 for 10 years," he said.

The purchasing power of the minimum wage has decreased 25 to 30 percent over the past decade because of inflation, Drago said.

"I hope they do not go this long again," he said. "Ideally, it should be re-evaluated every two years."