Lawmakers introduce bill to raise federal minimum wage

Industry associations oppose wage hike

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Industry associations, however, insist that a hike of this size would indeed damage the foodservice industry. Scott DeFife, the National Restaurant Association's executive vice president for policy and government affairs, said the NRA was opposed to the measure.

“It’s the wrong bill at the wrong time,” he said, adding that not only are the mechanics of the bill flawed from the standpoint of its “dramatic” increase in the minimum wage, but in its effort to peg future hikes to inflation. “Indexing has been shown, in most states, to have decreased job creation in certain sectors of the industry,” he said.

DeFife said the legislation would have a major impact on the restaurant business, which is still struggling to rebound from the recession and is facing significant cost concerns as it works to implement health care reform. “Minimum wage is just a proposal,” he said. “The regulatory changes in health care are very real. A minimum wage hike of this magnitude [as] proposed today on top of very real health care costs that will need to be absorbed is very troubling.”

Judith Thorman, the International Franchise Association’s senior vice president of government relations and public policy, said in a statement, “Franchise small businesses have been hit hard with constant incremental cost increases that make it more difficult for them to expand and create new jobs, such as [healthcare] compliance costs, tax increases, hikes in commodity prices and the lack of available capital. Raising the minimum wage by nearly 40 percent will pile on additional costs on the backs of these job creators.
 
“Franchises provide many Americans their first job — these jobs are many times at the minimum wage, but provide workers their first step on the employment ladder,” she added. “Increasing the minimum wage will not increase opportunities for these younger entry-level workers, but rather will make it harder for employers to offer these positions by driving up payroll and labor costs — in effect hurting the people proponents of raising the minimum wage want to help.”

The NCCR’s Green said he hopes Congress would “focus on other important issues like immigration reform, tax reform and the effective implementation of the healthcare law. I would rather see them focus on those key economic issues.”
 
According to the U.S. Bureau of Labor Statistics, an estimated 3.6 million people were paid hourly rates at or beneath the federal minimum wage in 2012, down from 3.8 million in 2011.

Eighteen states, including the District of Columbia, currently set their minimum hourly rates above that of the federal government. San Francisco has the highest local rate, at $10.55 an hour.

Contact Paul Frumkin at paul.frumkin@penton.com.
Follow him on Twitter: @NRNPaul