Over the next year we are going to see NH’s state minimum wage increase from $5.15 an hour to $7.25 an hour. That is a near 40% increase. Who is this helping? And more importantly who is this hurting?
To answer that we must look at a couple facts and figures. According to the data reported in the Union Leader, the census Bureau estimates that only .5% of NH's wage earners currently earn $5.15 an hour. And keep in mind that’s a half a percent of those who earn an hourly rate, so if you took that percent against ALL wage earners we’d be talking a much smaller number yet. So we aren’t talking about huge amounts of poor who can’t find work. In fact the state Economic and Labor Market Information Bureau reports that the median entry-level wage in NH is $9.24 an hour so anyone making minimum clearly isn't looking all that well for a job. Even Wal-Mart, the enemy of the left pays $7.50 an hour at their Manchester location.
Now if we look even further into this research done at the national level has concluded that of those who earn minimum wage 62% are only part time employees. And 56.1% of all minimum wage earners live in households earning more then 200% of what is considered poverty. 53% of minimum wage earners are under the age 25 and not considered head of household.
Based on all of this would you guess more then a handful of families are truly the poor the state democrats claim to be helping out here.
The businesses on the northern end of the state that pay minimum wage are mostly small ma and pa type businesses. Often times they hire a part time high school kid or maybe a retiree looking to stay busy. Increasing what they need to pay out in salary by 40% doesn’t just come from heaven. That money must come from somewhere. As I see it there are three choices the businesses must do. A) Take money from their own pockets to make up for the increase in salary. Since many small businesses owners don’t make all that much to begin with this isn’t a real choice for many. B) Increase prices. If prices go up, EVERYONE pays more. As a result everyone loses. C) Cut back on amount of hours or number of employees. Well now that employee is making about the same they did before and the business suffers because they don’t get as much help as they did before.
If our state democrats were wise they could have helped the poor more directly with earned income tax credits or even better yet cutting back the amount taken from them in taxes so the money they do earn can go a lot further.