Florida TaxWatch Report Finds That $15 An Hour Minimum Wage Could Harm Florida’s Businesses, Economy
TALLAHASSEE, Fla. - The latest Florida TaxWatch Economic Commentary finds that a raise in the statewide minimum wage to $15 an hour would likely harm Florida businesses and the job market. Florida TaxWatch estimated that businesses employing minimum wage workers in the state of Florida could see a nearly $2 billion increase in labor costs. This conservative estimate only accounts for workers currently making minimum wage, but an increase of the minimum wage to $15 an hour would raise the cost of wages for nearly half of Florida’s workforce.
“Raising the minimum wage to $15 an hour, despite advocates’ good intentions, would hurt hard-working Floridians. Businesses will have to reconsider their business strategy by cutting hours or, worse, laying people off. This decision is not one any business owner wants to make but would be necessary to protect their business,” said Florida TaxWatch President and CEO Dominic M. Calabro. “Florida should watch the wage implementations in New York and California closely before taking action on a $15 an hour minimum wage.”
Many of Florida’s leaders are advocating for investments to train and educate a more skilled workforce rather than mandate a $15 an hour wage. They argue that education and skills training will be more beneficial to workers and the economy rather than government intrusion into the labor market.
“Florida’s economy has recovered tremendously from the Great Recession because of the pro-Floridian policies that I and many of my colleagues have passed in the Florida Legislature. Lower taxes and less regulations have allowed the Sunshine State to thrive,” said State Representative Matt Gaetz, who represents Florida House District 4. “Raising the minimum wage to $15 an hour threatens this success. We must seek alternative options, like education and career development, to ensure workers are able to receive wages based on their skills and experience, not a government-mandated number.”
"The best way to raise wages is by helping workers get the skills needed to compete in today's global economy. Arbitrarily raising wages by the government will decrease opportunities - especially for those looking to enter or re-enter the workforce," said Florida Chamber of Commerce Vice President of Public Affairs Edie Ousley. "Let's focus on helping workers improve their career path through training and education, boosting their earning potential."
“A drastic increase to a $15 an hour minimum wage would have significant statewide impact that would harm Florida businesses. We understand the sentiment behind wanting to improve wages for Floridians but a leap from Florida’s current minimum wage to $15 an hour would severely damage the job market and hamper our state economy,” said Associated Industries of Florida President and CEO Tom Feeney.
"Immediately raising the minimum wage to $15 an hour would not only have detrimental effects on the economy, but also hurt those whom it was meant to help. Wage increases are usually enacted with good intentions but they often lead to lay-offs, cut hours and higher costs for goods and services,” said State Director for Americans for Prosperity – Florida, Chris Hudson. “We commend Florida TaxWatch for bringing light to the negative effects that would occur with an immediate wage increase to $15 an hour."
The report found that the increased labor costs negatively impact the job market. In order to continue to turn a profit in a new business climate, companies would be forced to make difficult decisions regarding their staff. Many companies could cut staff hours and freeze hiring, or leave the state altogether. Others could invest in autonomous technologies like self-checkout kiosks or look to pass increased labor costs onto consumers by raising prices. Some of Florida’s biggest industries, like retail, would be negatively affected, while small businesses could face closures.
“Retailers only have a finite amount of money for employee salaries, so any dramatic increase in the minimum wage, especially one up to $15 an hour, would be detrimental to Florida’s retail industry, resulting in laying off hard working employees, rising costs for businesses and increased prices for consumers,” said Florida Retail Federation President and CEO Randy Miller. “This would cause smaller businesses to close, killing competition and ultimately slowing down our state economy.”
"Small businesses are the backbone of Florida's economy, providing Floridians with hundreds of thousands of jobs. However, the push for a $15 an hour wage will drive labor costs up and force owners to make difficult decisions regarding their businesses and their employees," said Florida Executive Director for the National Federation of Independent Business, Bill Herrle. "Many of those employed at small businesses could see their hours cut or even a pink slip. Those currently unemployed could be further locked out of the job market. Artificially raised wages are detrimental for workers, small businesses and the state's economy."
The June 2016 Florida TaxWatch Economic Commentary can be read here.