Minimum wage increase will hurt businesses and workers

State Rep.
Kathy Lohmer

One of the proposals moving through the legislature right now is a bill that would impose an increase in the minimum wage from $6.15 per hour to $9.00 for small employers and to $10.55 per hour for large employers.

The increase would come three stages with the new minimum wage level in place by August 2015. Every year after that, the minimum wage will be adjusted based on the annual increase in inflation. 

Some argue that an increase in the minimum wage is necessary because the current minimum wage is not livable for our state’s workforce. However, according to the Minnesota Department of Labor and Industry, only 3.2% of all workers age 25 to 54 years old work minimum wage jobs. Well over half – 59.7% – of those making minimum wage are teenagers and young adults aged 15 to 24. A third of those making the minimum wage also receive overtime, tips, and wages.

As a mom, I always encouraged my boys to get jobs when they were in school to learn the value of hard work and the reward of earning a dollar. Imposing an increase in the minimum wage would simply create fewer working opportunities for our kids who are trying to get their first job during high school and college. 

If such a dramatic increase to the minimum wage is implemented, hard-working taxpayers who run family-owned businesses like restaurants will have to cut back on workers or increase the cost of their goods and services. In fact, the Minnesota Restaurant Association announced that nearly all of its members plan to increase menu prices and reduce staff hours in response to a hike in the minimum wage. 

I’m particularly concerned about the effect a minimum wage increase would have in our community. One of the attractions in our area is the St. Croix River. Many family-owned businesses – especially restaurants – locate there for the beautiful view of the river. Imposing a minimum wage hike would only encourage businesses to locate on the Wisconsin side of the St. Croix River and prompt some of them already here to relocate across the river. 

Those who run and work for restaurants wouldn’t be the only ones negatively affected by an increase in the minimum wage. Recently, I toured a group home in our district that serves adults with disabilities. Their staff works 24 hours a day every day of the week. Those who run the group home told me that imposing an increase in the minimum wage would significantly hinder their ability to assist a vulnerable group of people with unique needs who need care around the clock. 

Another great family-owned company in our district – Linder’s Greenhouse in Lake Elmo – told me that they generally hire 900 seasonal workers every year. Under this minimum wage proposal, the number of hires would be cut by one-third to about 600. 

During a recent Jobs & Economic Development Committee meeting, I asked a representative of Conservation Corps Minnesota if the increase in the minimum wage would affect their ability to employ people. Their response to me was that it would absolutely affect the number of individuals they would be able to hire. 

While raising the minimum wage may be a well-intentioned idea, it is a flawed proposal that will hurt employers and employees alike while making it more difficult for our state to move back to having a healthy economy. 

Like you, I’ve been frustrated with the snow during this spring. I’ve been eager to enjoy sitting on a restaurant patio with family and friends overlooking the beautiful St. Croix River in Stillwater. While the winter weather may prevent the patio doors from opening, imposing an increase in the minimum wage will do nothing but permanently snow-blanket the doors of our businesses and cause a blizzard of unemployment for those who need jobs the most.

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