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July 18, 2017—July 24 will mark eight years since the federal minimum wage was last increased. Since 2009, the federal minimum wage has been stuck at $7.25 – worth less than it was in 1950, adjusted for the cost of living. Business owners and executives across the country are speaking out in support of raising the minimum wage to strengthen businesses and boost consumer buying power.
Since it was raised in 2009, the federal minimum wage has lost 12 percent of its buying power, according to the Bureau of Labor Statistics Inflation Calculator. It’s lost more than one-third of the buying power it had in 1968, when the minimum wage was at its peak in value.
“The current federal minimum wage just doesn’t add up for workers or businesses,” said Holly Sklar, CEO of Business for a Fair Minimum Wage. “Workers are also customers. When the minimum wage is too little to live on, it undermines the consumer demand that powers our economy. Instead of paying decent wages, low-wage businesses end up paying the costs of low staff morale and high turnover – from increased hiring and training costs to lower productivity and customer satisfaction. While action in the states is vital where possible, we need federal action to ensure an adequate minimum wage no matter where people work and do business.”
While 29 states now have minimum wages at least a little above $7.25 an hour, 21 states do not. A minimum wage of $7.25 an hour amounts to just $15,080 for full-time workers.
Among the 29 states with minimum wages above $7.25, there are 13 states with minimums below $9 and only seven states with minimums of $10 or higher. No statewide minimum wage has yet reached at least $11.29, which is the value of the 1968 minimum wage in today’s dollars.
The erosion of the national wage floor undermines the consumer spending that businesses throughout the country depend on and weakens overall economic growth. Business owners know a higher minimum wage won’t just boost consumer demand, it will lower employee turnover, increase productivity and strengthen the economy.
The following business leaders and others are available for media interviews:
Doug Havron, Owner, Gabby’s Burgers and Fries, Nashville, TN: “Raising the minimum wage is good for small businesses like mine. Paying higher wages actually saves me money in a low-margin industry, as my employees are more motivated and provide better service. By raising the minimum wage, people will have more money to live on and spend at local businesses.”
Angela O’Byrne, President, Perez APC, New Orleans, and Louisiana's 2016 Small Business Person of the Year: “Our country’s minimum wage has been stagnant for too long. Miring full-time workers in poverty makes absolutely no sense from a business perspective. Paying fair wages boosts consumer spending, which drives job creation and forges stronger businesses and communities.”
Roger Smith, President and CEO, American Income Life, headquartered in Waco, TX: “The value of the minimum wage is so eroded that it buys less today than it did when I needed it to survive in the 1960s. Raising the minimum wage makes great economic sense – boosting sales and improving employee retention, morale and customer service. But it’s much more than that. Raising the minimum wage is a crucial step to restoring the shattered American Dream.”
Michael Lastoria, Co-Founder and CEO, &pizza, with locations in Washington D.C., Maryland, New York, Pennsylvania and Virginia: “Raising the federal minimum wage makes a lot of sense for businesses, the economy and our country. The success of our fast-growing company can be directly attributed to our employees – our Tribe members – feeling respected, appreciated and motivated. It’s a simple but critical concept: allow your staff to thrive, and your company will thrive along with them.”
Michael O’Connor, Owner, La Barberia, Philadelphia, PA: “We know that by paying fair wages, our employees are happier and they stick around, providing the great service that keeps our customers coming back and recommending us to others. When the minimum wage goes up, businesses will see costly turnover go down. Raising the minimum wage will put more money in the pockets of consumers to spend at businesses like mine.”
Sarah Mason, Owner, Poseidon’s Pantry, Chincoteague, VA: “It’s terrible that some businesses pay so little that people can’t live off of it. It’s not how we do business. It’s not how anyone should do business. That’s why we need to raise the minimum wage – to assure a decent standard of living for workers and a stronger wage floor under our customers and the economy.”
Mike Draper, Owner, Raygun LLC, Kansas City, MO and Des Moines, Cedar Rapids and Iowa City, IA: “Raising the minimum wage is important for fair competition and a thriving economy. My taxes shouldn’t be diverted into corporate welfare going to subsidize my competitors whose low wages drive their employees to public assistance to get by. An economy thrives when working people can make ends meet and have money to spend at local businesses.”
Camille Moran, Owner, 4 Seasons Christmas Tree and Produce Farm, Natchitoches, LA: “$7.25 is a terrible minimum wage whether you work long hours outdoors or behind the counter or as a health care aide. Our lowest paid employees already earn at least $10 an hour. Raising the minimum wage would provide a stronger, more level playing field for growing our economy.”
Jerry McGeorge, Vice President, Organic Valley, headquartered in La Farge, WI: “As a farmer cooperative, Organic Valley is rooted in the concept that people are our most important resource. Paying fair wages has helped us grow into a leading brand with more than $1 billion in sales. We strongly believe a raise in the federal minimum wage is sorely overdue.”
James Cunningham, Owner, James Cunningham Agency-American Income Life, Indianapolis, No. 2 among small businesses for Indiana Top Workplaces 2017: “Our employees are our most valuable resource and investing in them is an investment in the long-term growth of our agency. Raising the federal minimum wage is a needed investment in our nation’s workforce and stronger economic growth.”
Michael Katz, President, Molded Dimensions, Port Washington, WI: “Raising the minimum wage is good economic policy in two major ways. First, the longtime stagnation in low- and middle-income wages is having a dragging effect on our economy, which relies heavily on consumer spending. Second, our government often subsidizes families making at or near minimum wage with public assistance, which in turn subsidizes the firms that hire at these inadequate wages. That’s a highly ineffective, inefficient and market-distorting system. Increasing the minimum wage would reduce these kind of subsidies and increase innovation.”
Rebecca Hamilton, Family-Owner and Vice President, W.S. Badger Company, Gilsum, NH: “$7.25 per hour is not an adequate wage in New Hampshire, or anywhere we sell Badger Balm and our other products across the U.S. Paying a living wage is a core part of our culture and has helped us to retain excellent staff even in a time when other businesses have struggled. Fair pay and other family-friendly practices help build successful businesses and healthy communities.”
John Traynor, Owner, Harrisburg Midtown Arts Center and The Kitchen & Gallery Bar, Harrisburg, PA: “The current $7.25 minimum wage is a drag on the nation’s customer base, tax base and economy. When the minimum wage is too low for workers to make ends meet, it hurts businesses as well as workers. Raising the minimum wage is one of the strongest tools we have in revitalizing our economy and building thriving communities.”
Kathy Eckhouse, Owner, La Quercia, Norwalk, IA: “Businesses flourish when their employees can do well and are committed to the work they do. Raising the minimum wage is important to a healthy food system that sustains everyone from producers and sellers to customers and the communities we live in.”
Lloyd Smith, President and CEO, Cortech Solutions, Inc., Wilmington, NC: “We know from experience that employees earning a living wage value their job and it shows in their work. They are able to give far more of themselves to doing it well compared to those who are working a second job or preoccupied with how they will afford housing, healthcare and other basic expenses.”
Simon Arias, Owner, Arias Agencies, with locations in Florida, Maryland, Pennsylvania, Tennessee and West Virginia: “Companies claiming they can’t pay more than the current minimum wage should look to problems in their business model. Our turnover is very low, which saves me from the costly cycle of hiring, training and losing employees that plagues low-wage businesses. My employees are focused on their work and not distracted by continual financial stress. They know they have a stake in the growth of our business.”
Teresa Hendricks, Owner, Lucia’s World Emporium, Lexington, KY: “Investing in our employees with fair pay has provided great business benefits, including less turnover, more dedicated staff and wonderful customer service – all of which keep customers coming back again and again. And as a fair trade store we pay a fair wage to artisans for the products we purchase. Raising the federal minimum wage would help create similar positive economic change.”
For specific state rates, visit the Economic Policy Institute Minimum Wage Tracker at www.epi.org/minimum-wage-tracker.
Business for a Fair Minimum Wage is a national network of business owners and executives and business organizations that believe a fair minimum wage makes good business sense. www.businessforafairminimumwage.org.