Voters Oppose Minimum Wage Hike When Told Of Job Losses

Study Finds 27,000 Jobs Lost in Wisconsin

MADISON – Wisconsin could lose more than 27,000 jobs if a $10.10 per hour minimum wage was passed into law, according to a new study. Four leading business associations used the study’s findings along with poll data during a news conference held in the Capitol Wednesday to urge lawmakers to oppose a government imposed wage hike.

Democratic gubernatorial candidate Mary Burke and legislative Democrats have proposed a $10.10 per hour state minimum wage, up from $7.25 an hour. A study by the Employment Policies Institute (EPI), a non-profit research organization in Washington, D.C., found that Wisconsin could lose more than 27,000 jobs if the minimum wage were hiked that much. Those figures are consistent with the findings of a recent Congressional Budget Office (CBO) report that predicted the loss of 500,000 jobs nationwide if the minimum wage was increased to $10.10 per hour.

A public opinion poll conducted by a national pollster for WMC last week found that voter support for the proposed wage hike drops significantly due to job losses.

Wisconsin Manufacturers & Commerce (WMC), National Federation of Independent Business (NFIB), Wisconsin Grocers Association and the Wisconsin Restaurant Association held a news conference at the Capitol Wednesday to unveil the academic research and public opinion polling.

“The data is clear that raising the minimum wage will result in substantial job loss for Wisconsin employees,” said Scott Manley, Vice President of Government Relations for WMC. “When voters learn that increasing the minimum wage is a job killer, they quickly abandon support for this misguided proposal.” WMC is Wisconsin’s Chamber of Commerce.

Last week, The Tarrance Group of Alexandria, Va. surveyed 505 likely voters statewide for WMC and asked if they supported the $10.10 per hour minimum wage. The survey found that 53 percent support the proposal initially, but support drops to 39 percent when voters are told of the 27,000 lost jobs. After learning that single piece of information, 51 percent of voters oppose the plan, Manley said.

Bill G. Smith, state director for NFIB, said the proposal is arbitrary and drives up business costs, which results in job loss.

“An arbitrary, mandatory increase in labor costs without a corresponding increase in sales will force small businesses to make adjustments elsewhere,” Smith said. “Real businesses with real dollars and real jobs need to react each time the minimum wage is increased. No region of our state can fully escape the impact, and for most of those affected, the impact is negative. For those who are the victims of fewer hours or lost job opportunities, earned income will likely be lost.  Ultimately, someone must pay for the high labor costs of higher wages.”

Ed Lump, president and CEO of the Wisconsin Restaurant Association said the minimum wage hike will drive up prices and result in job losses.

“Raising the minimum wage sounds like a good idea, when you don’t know what the repercussions will be,” Lump said. “The fact is, a small business can’t just come up with the money to pay for a mandated wage increase out of thin air. The increased wages can really only come from two places, price increases and cuts in employee hours and jobs. In this economy, the potential for price increases is very limited, so hours will be cut and jobs will be lost. It’s that simple.”

Brandon Scholz, president and CEO of the Wisconsin Grocers Association, said the minimum wage hike drives up wages throughout a business.

“What people don’t understand, comprehend or simply ignore is the fact that it is not just one wage level that is increased under the mandate, it is every wage rate in the pay scale from bottom to top,” Scholz said. “The upward domino effect on wage expenses is a job and growth killer because the money isn’t there.”

Manley said the minimum wage hike would be a setback to the state’s improving business climate.

“Wisconsin has recently made so much progress to improve our business climate and grow jobs,” said Manley. “Raising the minimum wage would be a devastating step backward for Wisconsin workers.”

 

Related Material:
Click here for coverage of Wednesday’s press conference (WisconsinEye)

 

For Further Information Contact:
Scott Manley, (608) 258-3400

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