Augusta (December 6, 2013) – The National Federation of Independent Business (NFIB) today said that a report calling for a higher mandatory minimum wage so that every job can support a middle-class lifestyle abandons common sense and promotes the fanciful theory that wages are unrelated to prices and that prices are unrelated to demand.
“The real world doesn’t work that way,” said NFIB Maine Director David Clough. “Raising the minimum wage drives up the cost of labor, not just at the entry level but all the way up the pay scale. Employers will respond by eliminating jobs and raising prices. No one his helped by that.”
Clough reacted to a report by the Maine People’s Alliance (MPA), which claims that there are 10 workers for every one “livable wage” job. According to the group a livable wage job pays over $30,000 per year.
“There are many jobs in the economy that don’t require high skills and if employers are forced to pay more for them they’ll automate so they don’t need people, or they’ll find a way to do more with fewer employees,” he said. “The only way to create better jobs is to create a growing economy. That’s not possible with more expensive mandates on businesses.”
Clough warned that small businesses would be especially hard hit by the ideas that MPA is pushing. He wants lawmakers in Washington and Augusta to remember that small businesses provide more than half of the jobs in America and that they account for more than 95 percent of all the employers in Maine.
“We’re in the midst of a jobless recovery in which almost 50,000 people in Maine remain out of work,” said Clough. “We’ve also got very high taxes on corporations and small businesses, many thousands of costly state and federal regulations and much tougher competition around the world.
“Dictating higher wages guarantees even fewer jobs and higher prices,” he continued. “We should be moving in exactly the opposite direction, creating more opportunities for businesses and grow and create better paying jobs.”
For more information about NFIB, please visit www.nfib.com/maine.