Concord (March 12, 2014) – The National Federation of Independent Business (NFIB) today urged members to consider the impact on New Hampshire’s competitive position before they vote for an increase in the state minimum wage.
“New Hampshire has prospered because of its reputation as one of the best states in America to do business,” said NFIB State Director Bruce Berke. “Raising labor costs arbitrarily for small businesses would chip away some of our advantage.”
The House is expected this afternoon to vote on a bill to set the state minimum wage at one dollar above the federal level and then raise it every year, automatically based on inflation.
“The real danger in this bill is the automatic inflator,” said Berke. “Predicting inflation is almost impossible and this bill would make it impossible for small businesses to anticipate their expenses year to year. And by raising the rate every year it guarantees that some small businesses will never catch up with the increasing cost of labor.”
Berke noted that a dollar increase in the minimum wage would force small employers to spend almost 14 percent more for entry level labor and inflate wages all the way up the pay scale.
“There are very few small business in New Hampshire that can count on a 14 percent increase in sales this year. Even fewer can count on an increase in sales every year in perpetuity,” he said. “Businesses that cannot absorb higher labor costs will find a way to reduce labor.
“They’ll cut hours, cut benefits, eliminate positions or find ways to replace workers with technology,” he continued. “The best way to increase wages is to create the economic conditions under which workers are in higher demand. We need to grow the economy, not punish hiring.”
Learn more about NFIB at www.nfib.com.