For a while now, there has been a push to raise the federal minimum wage to $15.00 an hour. The minimum wage in Oregon is already fairly high compared to many other areas of the country, running between $11.00 and $12.50. So, a hike to $15.00 is not too drastic, but many people fear the impact in other states where minimum wage is under $10.00 currently.
Even in states with a higher minimum wage, there is still concern. Fox News explains that the biggest risk comes to small businesses that will have the toughest time staying afloat if they have to pay workers $15.00 an hour.
Instead of helping workers earn more money through raising minimum wage, it is having the opposite effect in areas that have already begun to increase wages. Small businesses specifically are reducing hours and eliminating positions to balance their budgets. Some are even facing complete closure of their business.
As a small business owner, you may already understand that it is tough to run a business. Your profit margins are often kept small due to the many costs associated with just keeping your doors open. High health insurance costs, rising rent expenses and other necessary expenditures can tax your finances.
Add to that an increase in wages, even if it is only $1.50 to $4.00, can have a huge impact. You will have to make some tough decisions, and what most business owners find is the easiest cuts are in work hours and number of employees.
So, while the idea of providing higher wages to employees so they can afford today’s cost of living is a nice one, it is not always practical. The larger businesses will probably be able to adjust and make a $15.00 minimum wage work, but for small businesses like yours, it could spell the end.