Local business leaders are speaking out against a proposed hike in the state minimum wage, calling for a smaller, more gradual increase than the one proposed in the Senate bill passed in November.
The North Shore Chamber of Commerce board voted in January to oppose the Senate bill. And on Monday, the Salem Chamber of Commerce hosted a program on the minimum wage debate featuring speakers from the retail and restaurant industries opposing the Senate bill.
“We say ‘lower and slower,’ whatever that means,” said Rinus Oosthoek, president of the Salem Chamber of Commerce. “We don’t want to kill job creation right now.”
The Senate bill, which still needs approval in the House, would hike the minimum wage from $8 to $11 by 2016, and then link future wage hikes to inflation. The bill also calls for a dramatic boost to the tip wage employers must pay waitstaff, increasing gradually from $2.63 an hour to $5.50.
“We are looking for a reasonable minimum wage increase,” said Beverly resident Jon Hurst, who is president of the Retailers Association of Massachusetts. He said the Massachusetts minimum wage should be in line with those of other states. New Hampshire, for instance, has a minimum wage of $7.25 an hour, which is the federal minimum. If the Bay State jumps to $11 an hour, it would put those doing business on the border at a disadvantage, he said.
A higher minimum wage can increase costs for all businesses, Hurst said, and hurt small downtown retailers, who face increasing competition from online retailers.
State Sen. Joan Lovely, D-Salem, said she also favors a more modest minimum wage hike. She voted last fall in favor of the Senate bill, which was pushed by Senate President Therese Murray, she said, but also voted for amendments proposed by Senate Minority Leader Bruce Tarr of Gloucester, “to slow the train down.”
“Ultimately, I voted in favor of the whole package,” said Lovely, who said she knew the bill would be amended by the House, tied to unemployment insurance reform to help lower costs for employers, and then come back to the Senate for a vote.
The North Shore Chamber of Commerce board voted 19 to 5 to oppose the increase in the Senate bill. The board then voted to support a more modest increase.
“When you take a look at other states and project them out, we will be the state with the highest minimum wage in the country,” said William Tinti, chairman of the North Shore Chamber.
Tinti said Connecticut, for example, will increase its minimum wage to $9 an hour by 2015. New York is doing so in steps by 2016.
The North Shore Chamber also favored the creation of a lower wage rate for teens, the reduction or elimination of the premium for Sunday work in stores, and a modest increase in the tip wage.
Among those at the business gathering on Monday, Rob Liani, the owner of Coffee Time Bake Shop in Salem, said he would like to see an increase at the federal level, “so it levels the playing field and gives people a decent wage.”
A national minimum wage increase would allow businesses in Massachusetts to compete with border states, Liani said.
Getting a minimum wage hike past the Republican-controlled House of Representatives, however, could be a daunting goal.
Hurst said retailers also want to eliminate the requirement that store employees who work on Sundays be paid time-and-a-half. This was a concession built into the law when stores were allowed to open on Sundays in 1980. If the minimum wage were to go to $11, he said, a supermarket employee could be earning $16.50 to bag groceries on a Sunday.
He also argued that teens might find more jobs if there’s a special rate — lower than minimum wage — for teenagers. He cited a study by the Commonwealth Corporation showing the employment rate among teens falling from 53 percent in 1999 to 26.8 percent in 2012. Hurst also called for unemployment insurance reform to go along with any minimum wage hike to take some cost off business owners.
Bob Luz, president and CEO of the Massachusetts Restaurant Association, also spoke at Monday’s event. “We believe there should be a minimum wage increase,” he said.
But his group opposes the increase in the tip wage. If a tipped employee’s wages, including tips, fall below minimum wage over the pay period, employers must make up the difference so everyone makes at least the minimum wage.
In Massachusetts, the average tipped employee earns $13.13 an hour, which is the tip wage plus tips earned, he said. Even though there’s been no increase in the tip wage since 1999, the Bay State has the highest average wage for tipped employees in the nation, Luz said.
Staff writer Ethan Forman can be reached at 978-338-2673, by email at firstname.lastname@example.org or on Twitter at @DanverSalemNews.