Instapundit points at an Economist Blog entry on the Minimum Wage which discusses (in part) one of the most common criticisms of increasing it -- poor folks rarely actually work for Min Wage -

It is probable that the minimum wage increase will not cost enough jobs to make its effects readily distinguishable from random economic variation.  It is also probable that it will improve the lot of a few poor people, though not many, as fewer than 20% of those who earn the minimum wage live in poor households now.  On the other hand, it also seems probable that much of any benefit that goes to poor families will come out of the pockets of other poor people—very probably even poorer people, such as convicts, who are currently barely hanging onto the fringes of the labour force.

One very illustrative datapoint comes from a friend of my family's back in Houston.   He's in the specialty home building biz (and doing rather well - the real estate schlump is far from affecting him).   

When I asked him about the labor market a few months ago he said that it was so tight that he couldn't even hire illegal aliens... err... undocumented workers... to do menial tasks like cleaning up debris from the construction site for less than $8/hr.  

Below that and they'd exercise their market power and walk...