Hike in minimum wage rate will hurt Maine’s economy

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Businesses just can’t afford the higher cost of untrained help.

Here we go again. The Maine Legislature, in its infinite wisdom, has driven another stake deep into the heart of small business in Maine. Oh, wait, it’s an election year. Surprise, surprise. Raising the minimum wage yet again sounds good when you’re looking for votes, but when more and more businesses leave the state, or just refuse to hire new people, what’s that going to do to the economy and job growth?

Small businesses already have to deal with obscene workers compensation rates, taxes, insurance and utility costs, not to mention trying to compete with foreign countries that pay a small fraction of the federal minimum wage. The federal minimum wage at $5.15 an hour is too much when you’re up against all of this.

I can see that our legislators think they’re more intelligent than our federal legislators.

I think the powers in Augusta don’t know what the minimum wage was intended to be. That is a training wage. They think it’s supposed to provide a living wage. When an employer hires an unskilled worker straight out of high school, or new to the workforce, the employer is losing money. Employers may pay the minimum wage, but add to that workers compensation, federal and state unemployment taxes, matching FICA, additional insurance costs and myriad other expenses on top of the minimum wage, and the true wage is more like $10 per hour, not $7. Hiring new unskilled workers is a losing proposition, whatever the minimum wage is.

I am a small business owner with no employees. I intend to keep it that way. I will not hire any unskilled workers because I cannot afford to lose money for several months while training an employee, only to have them leave once they are trained. That makes it hard on me as a businessman. It also makes it bad for my customers, because I really need help, and my customers don’t want to wait for several months for their work. One person can only accomplish so much in a day.

Maine already has one of the worst business climates in the country. This is just another nail in the coffin of small business and the general economy in Maine.

Alan Osborn has been a small businesman for 36 years. He owns and operates a small business in East Sumner and lives in Hartford.

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