Business Leaders Warn of Impact of Higher Minimum Wage

By Maddy Vitale Jane Davis, owner of Johnny B Goode Ice Cream Parlor in Ocean City, worries about the minimum wage increase that will be phased in over the next five years to the tune of $15 an hour. “Minimum wage jobs are not meant to be full-time jobs,” said Davis, whose business at 1363 Asbury Ave. is in its 25th year. Davis was at the Ocean City Regional Chamber of Commerce monthly meeting on Thursday waiting to listen to guest speaker Michele Siekerka, president and CEO of the New Jersey Business & Industry Association (NJBIA), on the topic “Preparing for the New Minimum Wage Increase and How it will Impact Your Business.” “I have a small business, and everyone employed is under the age of 20 but one. When payroll goes up, the cost will go up for the customers,” Davis said. “The vendors will go up, too. How much can the market bear? In my case, how much can I increase the cost of an ice cream cone?” Ice cream parlor owner Jane Davis asks Michele Siekerka what can be done to help the small business owners. Siekerka addressed about 75 business owners during the luncheon meeting at the American Legion Morvay-Miley Post 524 in Ocean City. “I am passionate about jobs for New Jersey. New Jersey small business is the lifeline. It is so important for your voice to be heard,” Siekerka noted. Under the terms of the minimum wage legislation signed into law Feb. 4, most employees will increase from the current $8.85 minimum to $10 on July 1. It will then rise to $11 an hour on Jan. 1, 2020, $12 an hour Jan. 1, 2021, $13 per hour Jan. 1, 2022, $14 in 2023 and $15 in 2024. An exemption for seasonal workers, which Senate President Steve Sweeney and local legislators fought for, allowed the total raise to $15 per hour to be implemented by 2026. The same timeframe applies to businesses with less than six employees. While proponents of the legislation believe it will give the economy a boost by bringing the minimum wage workers up to a living wage, Ocean City business owners said all it will do is hurt the small business owners who can’t afford to pay their workers the higher wage. Boardwalk merchants are among the local business owners concerned with the higher minimum wage. Like Davis, other members of the Chamber wanted to know what could be done to lessen the impact of the financial responsibility on the business owners with the rise in the minimum wage. Mayor Jay Gillian, owner of Gillian’s Wonderland Pier, called the change in the law bad for the businesses. He said the end result will be doing more with fewer employees. He predicted customer service may go down. Gillian noted that the minimum wage law, in addition to potential legalization of marijuana, could have "devastating" effects for New Jersey. “What can we do to try and halt this?” Gillian asked Siekerka. Siekerka said the business owners could join a coalition of businesses rallying for relief from the terms of the law. There are currently 400 business owners in the coalition. Mayor Jay Gillian speaks about how the new law could affect the businesses. Ocean City Financial Group financial planner Mark Reimet said he was discouraged to learn that many decisions in Trenton are "purely political," including the minimum wage increase and the potential legalization of marijuana. “It is discouraging to know that these political back-room decisions occur, especially when there are repercussions that are not thought out well enough or considered at all," Reimet said. Siekerka explained to the audience that there are ways that the state can lessen the impact of the higher minimum wage by giving the businesses tax credits. The payroll would not change, but the tax credits could help level things out, she said. “We are trying to look for ways to make adjustments, like tax credits,” she noted. Other issues to be considered are possible changes in the economy, Siekerka said. “We need a trigger to freeze increases if there is a recession,” she added. Caitlyn Quirk, owner of Bowfish Kids, located at 956 Asbury Ave., asked if the minimum wage increases also apply to workers under 16. Siekerka responded that the law applies to all ages in the workforce. “You need people willing to train the next generation,” Quirk said. “I expected an age limit.” Merchants in the downtown shops are also raising concerns about the higher minimum wage. Chamber of Commerce Executive Director Michele Gillian led the effort to organize members of the business community to oppose the minimum wage hike, resulting in a compromise version of the legislation. On Thursday, she told the Chamber members that Siekerka is a great representative for the Ocean City business community to stay in contact with. “We need to get our representatives to listen,” Gillian said. “Michele gives us a seat at the table.” Siekerka ended her discussion by urging business owners in the audience to express their views about the minimum wage hike. “Ocean City is an incredible place to be,” she said. “Please get involved. We need your voice.” For more information about the New Jersey Business & Industry Association and specifics on the minimum wage law visit www.njbia.org