LIHUE — Bob Stout minces few words when it comes to proposals to raise Hawaii’s minimum wage: It’s not a good idea. “Lawmakers need to realize the impact of the myriad of minimum wage bills being submitted,” the president of
LIHUE — Bob Stout minces few words when it comes to proposals to raise Hawaii’s minimum wage: It’s not a good idea.
“Lawmakers need to realize the impact of the myriad of minimum wage bills being submitted,” the president of Times Supermarket wrote in an email to state lawmakers. “Businesses will be forced to lay off workers to accommodate wage increases. We can’t continually increase expenses and try and pass it on.”
The Chamber of Commerce Hawaii agrees. It is urging its nearly 1,000 members to contact legislators and tell them not to pass a bill set for a hearing today.
“While it may not affect your company it will affect other businesses who may be your clients, as well as will have an impact on the overall economic recovery,” says an email from the chamber.
House Bill 2580 is scheduled at 2 p.m. today in the House Finance Committee. This is the second hearing on the bill. If it passes, the bill goes for a full floor vote in the House.
The bill will raise the minimum wage, $7.25, by 75 cents for the next three years. Thereafter, it ties the increase to the Consumer Price Index, which means the wage will automatically increase each year. It also repeals the tip credit.
Sherry Menor-McNamara, president and CEO of the Chamber of Commerce Hawaii, said raising the minimum wage will negatively impact business, increasing labor costs.
She noted that Hawaii is the only state that mandates employers to provide health care to its employees, including part-time.
“An increase will also increase mandated benefit costs and taxes, as they are all based on wage,” she wrote. “With the large increases in minimum wage being proposed, some businesses may have to cut back hours, reduce benefits or limit hiring of new employees – all unintended consequences which does not even take into account any economic slowdown.”
Randy Francisco, Kauai Chamber of Commerce president, also said large increases in minimum wage could negatively impact businesses by increasing labor costs up to 20 percent. For some businesses, he said it could result in a reduction in work hours, a reduction in benefits and limit the hiring of new employees.
“Furthermore, this does not project what could happen in the next economic slowdown,” he wrote.
There have been several bills floated this year that relate to the state’s minimum wage. One proposed raising it to $10 per hour within 11 months, another only to $9 per hour within three years.
Hawaii State Sen. David Ige, chairman of the Ways and Means Committee, said he was “committed to working with our counterparts in the House and the leadership of both chambers to ensure that we pass a minimum wage bill this legislative session.
“I support increasing the minimum wage, and passing a bill as soon as possible this session,” he said.
Sen. Mazie K. Hirono also joined the Democratic women of the Senate in calling to raise the minimum wage, highlighting the fact that nearly two-thirds of workers who earn the minimum wage or less are women.
She pointed out that a woman who works full-time in a minimum wage job to support her kids earns just $290 a week, which adds up to just $15,000 per year – below the poverty line for a single mom.
According to Bureau of Labor Statistics, of the 321,000 workers paid hourly rates in the state of Hawaii in 2011, 8,000 earned exactly the prevailing federal minimum wage of $7.25 per hour, while 7,000 earned less. The bureau reported that 1.56 million hourly workers in the U.S. earned the federal minimum of $7.25 an hour in 2012.
In last year’s State of the Union address, President Obama supported raising the nation’s minimum wage.
“Tonight, let’s declare that in the wealthiest nation on Earth, no one who works full time should have to live in poverty, and raise the federal minimum wage to $9 an hour,” the president said. “We should be able to get that done. This single step would raise the incomes of millions of working families. It could mean the difference between groceries or the food bank; rent or eviction; scraping by or finally getting ahead. For businesses across the country, it would mean customers with more money in their pockets. And a whole lot of folks out there would probably need less help from government.”
• Bill Buley, editor-in-chief, can be reached at 245-0457 or bbuley@thegardenisland.com.
