Small businesses sound off against minimum wage increase

2013-02-20T17:00:00Z 2013-02-21T23:38:07Z Small businesses sound off against minimum wage increaseRob Earnshaw Times Correspondent
February 20, 2013 5:00 pm  • 

The state’s leading advocacy group from small business owners is against President Barack Obama’s call to raise the federal minimum wage to $9 an hour.

Barbara Quandt, state director for the National Federation of Independent Business Owners, said the logic that raising the minimum wage is going to help everyone is seriously flawed.

“If raising the minimum wage from $7.25 to $9 an hour, which is substantial, is a stimulus for the economy, then why not raise it to $50,” she said. “It really defies logic or common sense. If people think that won’t affect the price you pay for your products and services, they’re mistaken.”

Quandt said a raise would backfire in that instead of creating more jobs and wealth, it would do the opposite.

“If someone was hiring students at $7.25 and all of a sudden they’re told they have to pay $9 an hour, obviously their costs are going up. But I think there would be less incentive to hire young people,” she said. “Why not hire an older person with more experience for the $9? Then they don’t have to deal with child labor hours and so forth. I think the kids lose, and I think the economy loses.”

John Barney, owner of several Wendy’s restaurants in Northwest Indiana, said employee hours get reduced when the minimum wage increases.

“The wage price goes up and you have to become more efficient, and you do,” he said. “Hiring of employees decreases in our industry.”

Barney said his industry is already under “enormous pressure” as a result of the Affordable Care Act.

“It just appears that this would be ill-timed,” he said. “We’re barely hanging on to not being at negative growth in the country and to put in a minimum wage increase would have a negative impact on growth. At this particular juncture, it seems to me to be ill-advised.”

The current federal minimum wage of $7.25 per hour translates to a $15,000 salary. It hasn't been raised since 2009. The federal minimum wage prevails in roughly 30 states that don't mandate a higher one, and the president called for raising it to $9 in stages by 2015.

Estefania Perez, 19, of East Chicago, works at a neighborhood Little Caesars. She supports a minimum wage increase.

"The cost of living is going up and look at gas prices," she said.

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