Goshen News, Goshen, IN

Business

February 3, 2014

Lifting the minimum wage big deal for small firms

NEW YORK — The dollar amounts may seem modest, but proposals to lift the minimum wage are a big deal for small businesses.

It’s an issue that affects large and small companies. But larger companies are more likely to have the financial resources to absorb higher payroll costs.

Opponents say a higher minimum wage could force businesses to lay off workers. Supporters say a fatter paycheck will make employees happier and more productive, and help companies attract better workers.

The debate over the minimum wage has intensified. President Barack Obama said in his State of the Union address he’ll sign an executive order requiring companies that have new federal contracts to pay their workers at least $10.10 an hour, up from the current federal minimum of $7.25. Voters in New Jersey approved, in November, a $1 increase in the state’s minimum wage, to $8.25 an hour.

Bills to raise the minimum wage were introduced in more than 30 states last year, with increases approved in four. In his speech Tuesday, the president encouraged state and local lawmakers to raise wages. Congress has deadlocked on most legislation amid partisan rancor ahead of the coming midterm elections.

“To every mayor, governor, state legislator in America, I say, you don’t have to wait for Congress to act,” Obama said “Americans will support you if you take this on.”

About 3.6 million workers have wages at or below the federal minimum, according to the Labor Department. That makes up 4.7 percent of workers who are paid by the hour. It’s not known how many work for small businesses.

The Associated Press spoke with small business owners, advocacy group leaders and business experts about the minimum wage debate. Here’s their take:

WHO: Steve Holand, owner of Carry Cases Plus, a manufacturer and distributor of carrying cases for tools and other equipment in Paterson, N.J. It has 31 employees, 12 at minimum wage.

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