NEWSFLASH: Industry Reacts To Proposed Minimum Wage Hike

14 Apr Posted by in Swag Projects | Comments
NEWSFLASH: Industry Reacts To Proposed Minimum Wage Hike

In his State of the Union address in January, President Obama urged Congress to enact legislation that would raise the federal minimum wage for all workers from $7.25 an hour to $10.10. “I firmly believe it’s time to give America a raise,” he said.

 Also during the State of the Union, President Obama said he would take executive action and raise the minimum wage rate to $10.10 for federal workers on new and renegotiated contracts. The move sets the stage for a debate on raising the minimum wage for all workers.

Reaction in the ad specialty industry to President Obama’s proposal was mixed. Mitch Cahn, president of Unionwear, a Made-in-America manufacturer of clothing and accessories, supports an increase. “A higher minimum wage will actually help business owners by reducing absenteeism and worker turnover, which costs businesses way more than nickel and diming on wages,” says Cahn, whose Newark, NJ-based company has 115 employees, all of whom make at least $1 more per hour than the current minimum. “Secure workers earning a living wage are productive workers and better consumers. A higher minimum wage just makes fiscal sense, especially when it is applied across the board, nationwide.”

By contrast, Anna Johnson, owner of Super Embroidery and Screenprinting in Phoenix, opposes the hike. She says it hampers business owners who have to raise their prices or increase production to make up the difference. “The employees in the middle are hurt the most because businesses cannot just raise everyone’s wages at the same time and still stay in business,” says Johnson, whose company has over 30 employees. “So the people that have been with a company longer or have learned higher skills are affected the most.” She believes this will impede teenagers and untrained workers in getting jobs because it will cost more to train them before they become proficient.

Currently, less than 5% of hourly workers make minimum wage. Twenty-one states have a higher minimum wage than the current federal rate. “We support the concept of increased wages to adequately support today’s standard of living,” says Tej Shah, vice president of marketing & e-commerce for Overture Premiums & Promotions. The Vernon Hills, IL-based distributorship offers in-house imprinting as well as warehousing, fulfillment and distribution. “For Overture, we’re excited about the change and believe it will have a positive impact on our business. Higher compensation tends to lead to better productivity, so while this will raise overhead for the industry as a whole, we do believe the overall impact will be positive.”