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Tuesday, March 11, 2014

Raising minimum wage a matter of fair labor costs

As the founder, owner and operator of a New Hampshire business, I urge our state legislators to support the establishment of a fair and reasonable minimum wage to provide a foundation for workers employed at all businesses, large and small, throughout the state.

Twenty-two years of operating a sign design and manufacturing business have demonstrated to me that our company’s products and services – like products and services sold and distributed by any business – must be priced appropriately to support the real and fair costs of doing business. Fair labor costs are an integral part of the pricing of those products and services. To price labor too cheaply – below that which can support a legitimate localized standard of living – falsely reflects product costs and allows some businesses to unfairly compete with businesses that properly regard labor, and value the health, safety and well-being of their workforce. ...

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As the founder, owner and operator of a New Hampshire business, I urge our state legislators to support the establishment of a fair and reasonable minimum wage to provide a foundation for workers employed at all businesses, large and small, throughout the state.

Twenty-two years of operating a sign design and manufacturing business have demonstrated to me that our company’s products and services – like products and services sold and distributed by any business – must be priced appropriately to support the real and fair costs of doing business. Fair labor costs are an integral part of the pricing of those products and services. To price labor too cheaply – below that which can support a legitimate localized standard of living – falsely reflects product costs and allows some businesses to unfairly compete with businesses that properly regard labor, and value the health, safety and well-being of their workforce.

The current federal minimum wage of $7.25 per hour ($15,080 in annual income) does not adequately support the cost of living in even the most rural counties of New Hampshire. A single adult with one child living in Hillsborough County incurs an annual cost of living near $40,000. To allow employers to continue to pay employees less than a living wage is a form of exploitation and should not be tolerated in our state.

A higher minimum wage is good for our economy. Those increased wages end up back in the local economy supporting local businesses. As a case in point: our company recently added a new full-time manufacturing position, filling it with a new employee making a career change from the restaurant sector, where wages and income were lower and less predictable. Several months after completing the probationary period, during which the new employee was being compensated at nearly twice the current federal minimum wage, he felt secure enough to make a well-researched and prudently financed purchase of a new 2014 vehicle. Needless to say, that purchase was a benefit to one Manchester automotive dealership, its service department, a local bank, the state Department of Motor Vehicles, and the town where it is now registered. Higher wages tend to be paid forward, thereby stimulating further business activity and increased business opportunities.

Furthermore, there is broad-based support in the small-business community for increasing the minimum wage. A recent national poll of small businesses conducted by the national small business organization, Small Business Majority, found that 67 percent of respondents support an increase in minimum wages. Interestingly, 65 percent of those polled indicated that an increase in the minimum wage would be a boost to consumer demand and, therefore, a boost to the overall economy. Two-thirds said that increasing the minimum wage would decrease pressure on taxpayer-financed government assistance, which is often required to augment low wages.

Those who suggest that raising the minimum wage would result in the loss of jobs fail to consider the number of recent studies conducted by national organizations like the Center for Economic Policy and Research and the Institute for Research of Labor and Employment. These studies evaluated the employment levels of abutting counties of adjoining states with different levels of minimum wage. The conclusion of these studies was that there was no appreciable difference in employment levels within those abutting counties.

It simply makes sense. It is time for the New Hampshire Legislature to reinstate a state minimum wage. And it is time for the Legislature to set that wage level at a truly living minimum wage.

Tom Hawkins is owner and operator of Northroad Wood Signs of Temple.