Workers, small business owners oppose Gov. LePage's bill to cut minimum wage

This article originally appeared on Maine Beacon.

Low-income workers, young people, labor advocates, small business owners and others argued before a packed legislative hearing on Wednesday that the bill backed by Governor Paul LePage to reduce Maine’s minimum wage is not only counter to the wishes of Maine voters but would severely impact their lives. Fair pay advocates also cited employment and wage statistics over the past year as proof that the first minimum wage increase in eight years in Maine has benefited the state’s economy.

The bill in question, LD 1757 introduced by Representative Joel Stetkis, would undercut much of the minimum wage law approved by public referendum in 2016 . If passed, the legislation would reduce the current hourly minimum from $10 an hour to $9.50, reduce the annual rate of increase by 50 cents and cut the eventual 2021 wage from $12 to $11. The bill also eliminates the cost-of-living adjustment and establishes a 90-day decreased wage, a so-called “training minimum wage,” for young workers.

“Right now an extra $200 a month would mean not having to pray I can keep my phone active and internet paid for so my son can do his homework. An extra $200 would mean I could try to save towards getting a car so we don’t have to walk in the snow and ice,” said Lewiston resident and single mother Lynnea Hawkins, referencing the higher amount she expects to earn following the step increase in the wage earlier this month.

“That little bump means the world to my family,” said Hawkins. “It’s only $200, and now you want to take away that little ray of hope?”

Marie Pineo, a South Portland resident who also “worked minimum wage jobs as a single mother to raise my children,” said in her testimony: “For so many families, this rise in the minimum wage makes it possible for them to pay their rent, to purchase their groceries, and simply, to survive.”

The hearing before the Committee on Labor, Commerce, Research and Economic Development also drew a number of young people, there to testify against the proposal for a 90-day sub-minimum wage for workers under 20 years old. They asserted that, for many young people in Maine, a paycheck is not simply “pocket money.”

Casey Smith, a Portland resident who grew up in and out of foster homes and supported himself since he was 16, told the Committee, “My money paid for my food because I didn’t have parents to help support me at the time.”

“That money wasn’t training money or video game money–it was cost-of-living money! It was the only reason I didn’t divert back to a fifteen-year-old stealing muffins to survive,” said Smith, who now he is a student at the University of New England working towards a Masters in Social Work. “I couldn’t imagine what it would have felt like back then going in and being told ‘you deserve less money because you’re younger’.”

James Myall, a policy analyst with the Maine Center for Economic Policy, explained that 27 percent of teenagers in Maine who would be affected by this legislation are living in or near poverty. “Their wages help feed and clothe their younger siblings, and help their parents make rent each month,” Myall said. “This legislation would take away a significant portion of that income, and plunge many of these families further into poverty.”

Further, he noted that the idea that young people could be paid less for their first 90 days of employment “only reinforces the current trend of employers treating their workers as disposable.”

“Especially in Maine’s highly seasonal economy,” he continued, “this 90-day training wage would encourage businesses to hire workers on a temporary basis at the lower wage, let them go at the end of that period, and simply rehire at the start of the next season at the same low training wage.”

Small businesses owners also appeared in force to testify to the economic benefits they’ve experienced since the wage hike, countering the opposition argument that business-owners would be negatively impacted by higher wages.

Tony Giambro, owner of the South Paris auto repair shop Paris Autobarn, said that 2017 was his company’s “best year ever,” having increased sales 24 percent over the previous year allowing him to hire more staff.

Nate Barr, who owns the Portland-based Zootility Tools, explained that, for him and many others, rising wages simply “creates more customers.”

“Maine customers want to buy high-quality products that are made here,” Barr said. “But if they’re paid poverty wages, they might have to choose the cheap stuff from Wal-Mart instead. When working Mainers get paid a decent wage, they have the freedom to make the consumer choices they want to. That means I sell more products and can hire even more workers.”

Providing some statistics for the Committee, Myall cited U.S. Department of Labor data which shows that in the first half of 2017, “wages were almost 5 percent higher compared to the year before, representing the largest year- over-year increase since before the Great Recession.” Those gains, he noted, were most seen at the lower end of the wage spectrum, “but the positive impact of the minimum wage legislation was felt throughout the economy.” At the same time, job growth “continued unhindered,” while there is no evidence that prices went up as a result of the wage increase.

Will Ikard, director of the Maine Small Business Coalition, noted that most Maine businesses already pay their workers a higher wage while it is the national chains that routinely pay less and thus have been most impacted by the wage hike, citing a report by the National Employment Law Project.

“By raising the minimum wage to $12, we reward the Maine-based small businesses that do right by their employees and communities while making the multinational chains that ship money out of our state compete on a level playing field,” said Ikard.

Encouraging the Committee to reject the new bill and side with the 55 percent of voters who voted to pass the minimum wage law, Pineo declared: “The people have spoken…If our government is going to do its job, and serve the people, then you have been given your instructions.”

Greene resident Alyssa Thompson testifies against a new effort to decrease the minimum wage before the Committee on Labor, Commerce, Research and Economic Development on Wednesday.