A strong minimum wage helps the whole economy
Businesses, workers, communities all benefit from a higher wage
At $7.25 an hour, New Hampshire’s current minimum wage is the lowest of any state in New England. It has been more than five years since the minimum wage was last increased, and the time to raise the wage is now.
A bill now before our Legislature (House Bill 1403) would re-establish our state minimum wage and increase it to $9 over two years, then provide cost of living adjustments thereafter. This bill would take the politics out of the pay scale and provide workers with some sense of security in knowing their pay will keep up with the cost of groceries and other necessities.
This modest and gradual increase will improve economic security for more than 76,000 individuals whose wages have not kept pace with the cost of living. Of these workers, 72 percent are over age 20; 36 percent are age 30 and older. Additionally, 59 percent are women and 14 percent are parents.
Many New Hampshire businesses proudly pay wages above the minimum, because they know that good wages improve worker productivity and reduce turnover, saving businesses from the costs associated with hiring and training new workers. But more importantly, these businesses pay higher wages because they value their employees as important members of their team.
These businesses know that their financial success is made possible only by the efforts of their employees.
Across the country, small businesses are voicing their support for a minimum wage increase. A recent national poll by the Small Business Majority found that 57 percent of small businesses favor increasing the federal minimum wage to $10.10 and indexing it to inflation. Additionally, 52 percent of respondents agree that this increase will provide an economic boost for their business through increased consumer demand.
It is widely acknowledged that increased consumer spending is essential to keep our economy moving forward. Since low-wage workers, by necessity, typically spend every extra dollar they earn, the increase proposed in HB 1403 will return an aggregate of $64 million back into the New Hampshire economy — spending that will positively impact local restaurants, shops and businesses across the state. A recent study by economists at the Federal Reserve Bank of Chicago confirms this likely outcome.
The 2014 WMUR Granite State Poll found that 76 percent of respondents, regardless of political affiliation or regional location, favored increasing the state minimum wage to $9 per hour. New Hampshire residents know that their friends and neighbors simply cannot make ends meet on today’s minimum wage. At $7.25 an hour, a full-time worker takes home less than $300 a week, which is barely enough to afford groceries and rent, let alone heat, clothes and gas for the car.
The sad reality is that for many of these workers, these low-wage jobs are the only jobs available; these jobs are the only option they have to put food on the table and provide for their families.
New Hampshire’s workers deserve to be paid a fair wage for a fair day’s work. Raising the minimum wage will help businesses, workers, communities and the New Hampshire economy. We urge New Hampshire legislators to support HB 1403. It is time to raise the wage in New Hampshire.
David Hills is a partner and Alison Pyott is wealth manager with Veris Wealth Partners, Portsmouth.