A $15/hour Minimum Wage is Good for Business, By Don Mayer, CEO of Small Dog Electronics
The Vermont Legislature recently passed a measure to increase the minimum wage to $15 per hour by 2024. As a Vermont business owner, I believe this is sound policy and should not have been vetoed by Gov. Scott.
Many families now work multiple jobs and are still not able to meet the basic needs of shelter, food, heat and medical care. As a result, the cost to the taxpayers is significant in terms of programs such as food stamps, heating assistance, welfare, and other safety net programs. A $15 per hour minimum wage would go a long way towards mandating a Livable Job for every hard-working Vermonter.
Small Dog Electronics has long been a member of Vermont Businesses for Social Responsibility, a statewide business organization that has been a leader in advancing policies supporting Livable Jobs.
As a retailer, I have struggled to bring my employees all up to this standard. Retail is a tough sector of our economy right now, as the closing of high profile companies such as Toys R Us and others demonstrate. And yet, not providing a minimum wage that allows an employee access to the basic human needs is simply exploitation of that worker.
Small Dog Electronics has committed to pay all our employees $15 per hour way before 2024 and that is a huge step, especially when you consider our generous health care benefit can add as much as $6 or 7 per hour to an employee’s overall compensation.
In an era of gigantic tax cuts for the wealthy and corporations and skyrocketing salaries for executives, it is a travesty that we are not addressing the needs of the most vulnerable of the workforce. The diminishing middle class is a direct result of low wages and the trend towards lower-paying service and part-time positions.
I have found a direct correlation between wages and employee retention, productivity and loyalty. A minimum wage employee understands what a Livable Job is and will stick with that employer through thick and thin. The savings in recruitment and training costs is significant when an employer offers reasonable wages – and $15 per hour, especially under the timeline of the Legislature’s bill, is reasonable.
There are those that say a minimum wage that catches up with inflation and hits $15 per hour by 2024 would result in massive job losses, but the facts simply do not support that. Previous raises to the minimum wage have not seen such losses and minimum wage to $15 per hour in places like Seattle have actually seen increases in employment as the jobs are more sustainable for employees.
Larger companies such as Costco discovered the same thing we are finding at Small Dog Electronics: Paying retail employees more actually saves money in terms of productivity, training costs and recruitment costs.
We live in a very competitive commercial environment and paying employees $15 per hour will not cause prices to increase. In fact, it will likely even the playing field between those companies the pay good wages and those that exploit their workers to increase profits. Some prices may rise a slight amount as a correction, but with all competitors paying at least that minimum those price increases are perhaps a better way to deal with the shortfalls in non-livable jobs. Would you rather pay a few more cents for groceries, as an example, or have your taxes increase to support the increasing numbers of workers unable to meet basic needs?
Paying minimum wage employees more will help the economy because with more money in their pockets (unlike corporations or the very rich) that additional money in the paycheck will go directly into the local economy.
Minimum wage jobs are not just summer jobs for teens anymore. The typical minimum wage worker is a 36-year-old college-educated mother working full time. Less than 10 percent of minimum wage workers are teens – most are in their prime working years of 25-54. More than half (56%) are women and 28% have children. The minimum wage has significant impact upon women but also on minorities. Nearly 40% of African American workers work for minimum wage and a third of Latinos.
I appreciate the work of the Vermont Legislature to advance this policy, especially the leadership shown by House Speaker Mitzi Johnson and Senate President Tim Ashe. Gov. Scott’s veto is disappointing, but this movement does not end there.
Adjusted for inflation, our economy pays minimum wage workers less today than we did 50 years ago. It is time to change this trend, help to rebuild the middle class and provide Livable Jobs to all Vermonters.
Don Mayer is the CEO and Top Dog at Small Dog Electronics, which has locations in Waitsfield, South Burlington, and Key West, Florida.