In his bid for president, former Colorado Gov. John Hickenlooper has joined the ranks in favor of raising the minimum wage nationwide to $15 per hour. Everywhere. No exceptions.
More than a dozen states have already set minimum wage rates at above $10 per hour. And all states are required to meet federal standards (a combination of cash wages, tips and other benefits as described in federal law). To make it simple, the baseline is $7.25 for the "basic combined cash and tip minimum wage rate."
When you look at the cost of living in New York, Denver, Los Angeles, or other metropolitan areas, it makes sense. But we have to question whether Hickenlooper and like-minded folks have considered what such a sizeable jump in the minimum wage would do to rural communities and mom-and-pop businesses.
And there are plenty of both in this nation of ours. Highways in the so-called "fly over" states are dotted with small towns, places with populations ranging from a few hundred to a few thousand, with a few "big cities" here and there along the way.
One of the joys of two-lane travel in those areas is pulling into a small-town café, ordering a bite to eat or maybe just coffee and pie, and jawing for a bit with the locals. Generally that amounts to about $10, including tip.
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Now put yourself in the shoes of the café owner, who's trying to keep a business afloat, not just to pay his or her own bills but also for the sake of the locals. Say it's a family business, and mom and pop are the "chief cooks and bottle washers" as the old saying goes, taking orders, cooking and serving food, clearing tables and washing dishes, and cleaning up after the doors close. Maybe there are a few local folks on the payroll, helping to cover the busy times and maybe even giving Mom and Pop a break now and then.
The same concept applies to the gas station and C-store, the local mechanic's shop, hardware store, feed store and the like - small businesses that serve their local communities and people in surrounding areas.
If those businesses are paying the $7.25 (or, in the case of the café, a base minimum since servers earn tips), jumping to a $15 minimum wage is a huge leap. Payroll has just doubled. So-now what?
Do Mom and Pop give up their salaries to pay their workers? That's not going to last long - they've got their own mortgage, utilities, and all the other bills that go along with adult life.
Selling more is possible, but not probable. So do they raise prices to cover the additional costs? That's a pretty steep jump - how many of their customers will support them and how many will walk away?
Or do they reduce their staff and try to make do with fewer people to get all the work done? And how do you make that decision? Who do they let go? Betty, who's been working there for years and relies on her wages to keep her own family going? Or the high school kid who washes dishes after school, who's saving toward classes at community college next semester?
Or do they just give up, close their doors, and leave one more building boarded up on Main Street?
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Small business owners in rural communities want to pay their employees better - they genuinely love their communities and want them to survive and thrive. But a mandated minimum wage increase of such large proportions will force hard decisions - decisions the whole community will feel.
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