By David Jahng
Capital News Service
Legislation that would increase the minimum hourly wage in Maryland to $15 would mean higher salaries for struggling workers, but may also mean higher prices and companies leaving the state, supporters and opponents told lawmakers this month.
House Bill 166, or the “Fight for 15,” would raise the state minimum wage from $10.10 to $15 an hour by 2023. Lawmakers heard just as much opposition as support for the legislation at a House Committee hearing Feb. 6.
Identical legislation, Senate Bill 280, sponsored by Sen. Cory McCray (D-Baltimore), was heard on Thursday. Neither piece of legislation has advanced out of committee.
Over the past four years, Maryland’s minimum wage rose to $10.10 an hour, and it is one of 29 states that has a minimum wage above the federally mandated $7.25.
However, families are still struggling to pay the costs of basic necessities, said Del. Diana Fennell (D-Prince George’s County), sponsor of the bill.
Closing the wage gap would allow not just youth, but older workers in the food and health care industries to support themselves without having to work multiple jobs, Fennell said.
Democrats are holding out the “Fight for 15” as one of their signature initiatives this legislative session; Republicans, including the governor, are generally opposed.
About 150,000 jobs could be lost due to higher wages, Maryland Gov. Larry Hogan said at a press conference on Feb. 7.
But supporters said the bill could increase productivity and help people who are forced to work multiple jobs.
“Am I paying a living wage?” should not be a question employers are asking, said Ned Atwater, owner of Atwater’s restaurants in Baltimore, who supports the bill.
A message that everyone is valued is conveyed with higher wages, Atwater said.
It is the hope and understanding that raising the minimum wage would help individuals be happier, more productive and committed to their jobs, Senate Majority Leader Guy Guzzone (D-Howard County) said.
Mat Rice has been the employer for an advocacy group run for and by people with developmental disabilities since 2008. He said he had to sign for one of his employees to get food stamps in 2017.
“I never had to do that, that is heartbreaking,” said Rice.
Raising the minimum wage is a step in the right direction to ensure the developmentally disabled are adequately paid, said Rice.
But for Edward Bolton, a small-business owner in St. Mary’s County, wage increases would cost him $150,000 annually–more than his net profits from last year, he said.
His three auto parts stores rely on lower-wage employees as delivery drivers, and an increase in salaries would limit part-time positions and the number of vehicles he can own, Bolton told Capital News Service.
“Which in turn means the service to my customers suffers,” Bolton said.
Many minimum wage positions would become much harder for employers to afford, which in turn could make it more difficult for entry-level, younger workers to find jobs, said Laura Toraldo, senior director of communications and digital media at the Maryland Chamber of Commerce.
Consumers would be hurt as employers raise prices to afford the rising wages, and businesses could “pack their their bags and move across state lines,” Toraldo said.
Workers younger than 25 made up nearly half of those paid minimum wage in the U.S., a 2018 study by the Bureau of Labor Statistics found.
Raising wages would be detrimental to employees, said John Henderson, owner of an Outback Steakhouse in Ellicott City.
After the last increase to the minimum wage, prices had to rise too, and the busboy sector of the restaurant had to be let go, Henderson said.
Currently, employers can pay workers less if additional money from tips reaches the minimum wage. This “tip credit” would be phased out by 2026 under the bill.
Jay Steinmetz, CEO of Barcoding Inc., headquartered in Baltimore, told Capital News Service that his company lost a $50 million contract because their pricing could not compete with companies based in North Carolina.
North Carolina has a minimum wage of $7.25, and Maryland’s neighboring states do not have a minimum wage higher than $8.75.
People who have never run a payroll, workers compensation and unemployment should not be making the laws, Steinmetz said.
“We’ll move our business” out of Maryland, said Steinmetz.