ANNAPOLIS — The Maryland General Assembly gathered in an Economic Matters Committee meeting on Feb. 8, to discuss legislation that would raise the state minimum wage to $15 and while they heard from workers who are for increased wages, business owners are concerned about of the effects it would have on small businesses around the state.
The bill, which would go into effect at the beginning of the fiscal year on July 1 if passed, would raise the minimum wage by one dollar each year until 2023 when it will reach $15 statewide.
Prince George’s County contains a number of small businesses at the National Harbor, Beltway Plaza Mall in Greenbelt, Baltimore Avenue in College Park and everywhere in between. Many beauty stores, clothing stores, restaurants and more would see increased expenses that can either affect them positively or negatively if the new bill is passed.
“I’m not saying whether it would be a positive or negative effect,” said Felix Kim who works at Stripe 3 Adidas in College Park. “But how could it not affect any business?”
Jared Littmann, who owns K&B True Value, a family-owned hardware store in Anne Arundel County, said the bill concerns him because it would mainly affect small, family-owned stores who employ many entry-level workers, such as his own store.
“I don’t see where that is fair,” he said. “Why is it fair to have legislation that has good goals but unfortunately has the most impact on one segment of the business society? It emphasizes my point that this should be a tax-payer based solution, not a business solution.”
Prince George’s County Executive Angela Alsobrooks attended the Economic Matters Committee meeting and was one of the county leaders who supported the minimum wage increase giving a brief speech asking for it to be passed and the benefits it would have on Prince George’s County residents while recognizing the challenges the increase might pose to small business owners.
“I’ve heard the concern from some people, and I think it’s a legitimate concern saying whether or not the business community will be able to afford to pay employees once the increase goes into effect,” Alsobrooks said.
But she also said that at this point, with the increased cost of living and inflation, that we cannot afford not to raise the minimum wage.
“As public servants this is something to take into account when we discuss this legislation, and I’m sure we want to do what is best for our business community, especially our small local and minority business but they will be able to adapt to this change because I think we can all agree when we talk about businesses. Business owners are hard-working and just as concerned about providing for their families.”
However, Maryland Chamber of Commerce Vice President of Government Affairs Larry Richardson agreed that it would not be that easy.
“I’ve had folks come to me and say well Walmart does it, Amazon does it, down here in Annapolis the Anne Arundel Medical Center recently announced they are going to do it. And my response to that is, that’s fantastic. I think it’s great that they can do that. Any business that is financially in a position where they can do that should do that. The problem with the bill as it is been presented, however, is that it is literally a one size fits all.”
The small family-owned businesses and corner stores do not have the money that Amazon and other big corporations have, and it would be tough to pay $15 an hour plus their other operating expenses, Richardson said.
Many of the small business owners he had spoken to said they would not be able to keep up with the change and would be forced to cut hours, relocate or even close permanently.
Littmann said the legislation is not clear about what it is trying to address and as proposed does not solve the underlying problem and would cause unintended consequences.
“If the legislature is trying to address the problem of adults working minimum wage jobs and that they are unable to get higher paying jobs and are trying to support a family I think that’s a terrific goal to approach and work towards a solution. I think that the current legislation is a broad, broad solution that very inartfully targets that specific problem.”
Although county leaders from Prince George’s, Montgomery and Anne Arundel Counties came in support of the $15 minimum wage legislation, those from the state’s smaller, rural counties said that one-size fits all wage cannot work everywhere in Maryland.
Representatives from rural counties such as Chamber of Commerce members, other business owners and organizations leaders in Worcester, Allegany and Garrett Counties pointed out at the meeting that it would not be as easy for business owners in smaller and less developed counties to adapt to a $15 minimum wage and asked for the committee to come up with other solutions.
Further, Richardson said that although regionalizing the minimum wage may be a solution, and it would only complicate things further supposing that a business might operate in two different counties in different wage zones creating an “administrative nightmare.”
“A lot of times the proponents will attempt to portray this as the fact that this as it will help get folks out of poverty,” Richardson said. “$15 an hour is not going to get folks out of poverty. Where we think the emphasis should be is to get a regulatory environment and a mindset to say let’s improve our workforce development programs, let’s try to grow and educate the workforce and grow and educate jobs here so we can get more people to make decent wages and not an entry-level wage.”