ANNAPOLIS, Md. (WJZ) — Pushing for higher pay. The governor backs a bill that would raise the state’s minimum wage by almost $3–but some business owners say that could backfire.
Meghan McCorkell has both sides of the fight.
Charmington’s in Charles Village has been brewing up business for more than three years. Since the beginning, owner Amanda Rothschild has paid employees above the state minimum wage.
“We actually lowered our costs by paying them more and having employees that want to stay for a year or two years,” she said.
Now she’s speaking out in favor of a new bill in the General Assembly that would raise the minimum wage in Maryland from $7.25 an hour to $10.10 by 2016.
“It’s not only the right thing to do to reward hard work, it’s also the best thing to do for our economy,” Governor Martin O’Malley said.
Both the governor and lieutenant governor testified in favor of the increase, but a new study says raising the wage could lead to thousands of job losses in Maryland.
“It isn’t that this isn’t a good idea. It’s that doing it alone all by yourself makes it expensive,” said economist Stephen Fuller.
Dave Norman is president of Davco Restaurants, which owns more than 150 Wendy’s. He says if the wage goes up, he may need to close 10-15 locations.
“What’s that going to do to us? How long can we keep that store open before we have to just take our losses and shut it down and put all those people out of work?” Norman said.
He says that may mean raising prices, which could lose even more business–especially near state lines.
“If you have a choice of going to a Wendy’s store in Maryland and paying more or going to a Wendy’s store in Delaware and paying less, where are you going to go?” said Norman.
But the formula has worked at Charmington’s. The cafe is now expanding.
“We need the seating,” Rothschild said.
If passed, the minimum wage would be increased in increments until 2016, when it would stand at $10.10.
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