MD NFIB Warns Lawmakers Against Raising Minimum Wage

Date: February 11, 2014

Annapolis (February 11, 2014) – Maryland’s reputation among small business owners is already comparatively weak and a 40-percent boost in the cost of entry-level labor will be another black eye for the state, the National Federation of Independent Business (NFIB) will tell lawmakers today.

“Our taxes are already very high.  Our regulatory system is already very costly.  Raising the minimum wage by 40 percent and then putting it on auto pilot will make Maryland immediately more expensive to run a small business,” said NFIB State Director Jessica Cooper.  “We can’t keep piling on the costs and expect small businesses to keep producing jobs and opportunities for Marylanders.”

Lawmakers today are hearing testimony on a bill that would increase the state minimum wage from $7.25 per hour to $10.10.  It would also mandate automatic annual increases based on the Consumer Price Index.  If the bill passes Maryland’s minimum wage would be 22 percent higher than the rate in Delaware and nearly 40 percent higher than it is in Virginia, Pennsylvania and many other states.

“For most small businesses this is not about the next kid they hire.  It’s about their entire payroll,” said Cooper.  “Small business owners will have to pay their current workers more than the minimum wage, so this bill will inflate labor costs all the way up the pay scale.”

Cooper pointed out as well that according to federal statistics very few full-time working adults are earning $7.25 per hour.

“The typical minimum wage worker is a kid with very little experience and this bill would force employers to pay them as much as older employees with higher skills,” said Cooper.  “The unemployment rate for teenagers is already three times higher than the average and this bill would make young workers even less attractive.  We’ll be pricing young people out of the job market.”

Small businesses that can’t absorb the increase will be forced to cut jobs, said Cooper.

“They don’t want to eliminate jobs but this bill would give them no choice,” she said.  “They can’t pass the cost on to consumers and they can’t reduce their other expenses.  Payroll is one of the few places where they can make cuts.  The result will be fewer jobs and fewer opportunities, especially for young people.”

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