Employers say minimum wage hike impacts more than paychecks


The new minimum wage will impact business.

Washington's 30 cent per hour minimum wage increase could impact everything from beer prices to employee layoffs.

And that's just in Sunnyside.

The wage increase, mandated by a 1998 voter-approved referendum, matches minimum wage increases to annual rises in consumer prices.

This year's raise became effective on Jan. 1 and set the state's minimum wage at $7.93 per hour.

"I'm not sure what the total effect is going to be," said Gary Hook, owner of the Sunny Spot Restaurant in Sunnyside.

Hook said the eatery may have to raise prices some to account for the wage increase, as well as the increased wages his suppliers will have to pay.

"We'll have to adjust a little bit because they're going to raise their prices," he said. "It gets harder all the time."

Over at the Buena Vista Mini Mart, Nelson Gabino said he may raise prices on beer, candy and soda pop to adjust for the wage increase.

Gabino is thinking he may also have to cut his three employees' work schedules by an hour or so a day to make up the difference.

"It's going to affect everybody," he said of the rising minimum wage.

That's even true for employers who pay above minimum wage.

Over at Lava Rock Nursery, for example, employees start out at about $8 per hour.

With minimum wage now essentially at $8 per hour, owner Billie Warwick said she'll have to give her five employees a raise to keep them above minimum wage.

Warwick said the public often doesn't realize that an $8 an hour wage actually comes out to $9 or $10 by the time taxes are figured in.

With Lava Rock's wages going up, Warwick said the nursery will have to adjust by trimming employee hours-perhaps even laying off one or two workers-and raising prices on some items.

"We'll have to cut hours and go with the flow," she said.

Sun Terrace, a retirement and assisted living center in Sunnyside, doesn't have the option of cutting employee hours to make up the minimum wage increase.

"We're pretty tight to begin with, we don't have extra people," said Don James, general manager for Sun Terrace. "We'll just watch the budget as closely as possible."

Sun Terrace is also limited in how much it can adjust its prices.

"We have a significant proportion of the residents who are being paid for by the state," said James. "It (the state) increases regulations and minimum wage, but the reimbursement rate doesn't go up, or if it does it's a tiny fraction."

As James noted, minimum wage is only one of many regulations the state requires of businesses.

Hook said B&O taxes on gross receipts can be a hardship. "It's a tax that isn't very friendly to small businesses," he said.

Warwick said Lava Rock's Labor and Industries insurance rates have gone up because the nursery requires manual labor.

Not only do small business owners feel minimum wage increases can be a hardship on top of all the state's other regulations, some question the validity of paying a minimum wage of nearly $8 per hour.

"You essentially remove the market from play and put in a socialist system," James observed.

Added Hook, "What really makes it bad is when first time workers start at that wage there's no initiative to do better."

The minimum wage hike will affect all businesses differently-whether it be an assisted living center, corner market, restaurant or nursery.

James says there's one thing they all agree on, though, "The consumer ends up having to foot the bill."


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