HANFORD — With the New Year comes changes, and one of the bigger changes at the beginning of 2018 will be another increase in minimum wage earnings.
Starting Jan. 1, businesses with over 26 employees will have to pay a minimum wage of $11 per hour and businesses with fewer than 26 employees will pay $10.50 per hour. Both wages are going up 50 cents from what the previous standards were.
The increase was passed and signed into law in April 2016 as Senate Bill 3 by then-Sen. Mark Leno (D-San Francisco). Several increases over the next few years will gradually raise California's minimum wage to $15 an hour by 2023.
The bill was put into effect with the intent to help improve the economic well-being of lower-paid workers and combat poverty.
Joey Joslin, executive director of the Hanford Chamber of Commerce, said the increase will affect every business in the state in some way, particularly the small businesses with fewer than 26 employees.
Joslin said the last thing businesses owners want to do is let go of employees, so product prices go up to balance the costs. He said one of the most important things for a small business owner to do is let customers know ahead of time that there may possibly be changes to pricing on products.
“When you own a small business, you’re not making a lot of money,” Joslin said. “It’s important for the community to understand that as minimum wage increases, so does the cost of goods. It’s a double-edged sword.”
Damon Miller, owner of the Chicken Shack in Hanford, said he has 13 employees, so he falls under the new $10.50 minimum wage law. However, he said he already pays his employees more than minimum wage because he wants to keep his good employees happy with what they’re earning.
Miller said he doesn’t understand the logic behind all the wage increases and doesn’t believe the increases benefit workers as much as some people think they will, especially because the prices of products all rise as well.
He said the minimum wage increases actually benefit the state more because as product prices increase, the state gets more sales tax money. When product prices increase, Miller in turn has to sometimes increase the prices on the food he serves.
He said he gets complaints about his prices every once in a while, but for the most part, his customers are OK with the increases because he explains to them why the costs are rising and they know the good quality of service and food will remain the same.
Although the wage increase is meant to help lower-paid workers, Joslin said most of the time the younger workers are the ones who minimum wage increases hurt the most because employers may not have the justification to pay an unskilled worker that amount of money.
Joslin emphasized the importance of an education for younger employees and Miller agreed, saying he encourages all of his employees to get an education so that they can get higher-paying jobs and be able to afford the products they want.
Whether businesses are for or against minimum wage increases, Joslin said it’s just something business owners and employees will have to deal with for the next several years, so they should take the time to learn about and understand the issue.
“It’s manageable; we just have to make sure everyone is informed,” Joslin said.