As minimum wage goes up, will hours go down?
Friday’s wage increase will be the last of three increases that started in 2007, when minimum wage was $5.15 an hour. Since then, minimum wage has increased by $2.10; a 40 percent increase for the lowest paid workers.
Carlos Simpson is a minimum wage employee. “I feel like it’s about time. I have bills. My phone bill is about to kill me and I can’t pay it anymore. I need this raise,” he said.
Seventy cents per hour may not seem like much, but for full-time minimum wage workers like Simpson, the increase will mean almost $30 more in their weekly paycheck. “That could be a haircut or some gas. That could be anything. I might go to the club twice in one week, you don’t know,” Simpson said.
Minimum wage going up is good news for those who have a job, but experts say the increase could ultimately make more people wind up at the unemployment office. “As the rates go up, the employees who get to keep their job are happy, but overall, either they get less hours, which impacts them, or they lose their job,” described Sara Raleigh of Wilmington SCORE.
At small businesses like Coastal Cupcakes, the additional 70 cents per employee, per hour, adds up quick. A company with ten employees will pay almost $300 more per week. For the month, the payroll will increase by more than a thousand dollars. For Coastal Cupcakes, it means they can not hire the additional employees they need.
“Right now, this is the max number of employees that we can afford to have at this time, at this rate,” said Coastal Cupcakes co-owner Kristen Beckmeyer.
But Beckmeyer said she will take every step to avoid parting with an employee. “Before laying anybody off our first reaction would be to decrease hours. We as the owners would come in and work more hours,” she said.
While minimum wage workers will see more money in their pay checks, the increase won’t help restaurant workers. The minimum wage for servers and bartenders is $2.13, and it will stay that way.
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