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home : news : business   May 29, 2016

2/24/2014 10:12:00 AM
Raising the minimum wage: Is it necessary?

If you're a small business owner, would you consider paying a highter minimum wage to your employees? Mike Blair at Mike's Pro Shop in Spring Valley thinks that minimum wage should be raised. He currently pays his employees $10 an hour.NewsTribume photo/Scott Anderson
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If you're a small business owner, would you consider paying a highter minimum wage to your employees? Mike Blair at Mike's Pro Shop in Spring Valley thinks that minimum wage should be raised. He currently pays his employees $10 an hour.

NewsTribume photo/Scott Anderson

Yes: Hardworking people struggle to make ends meet

By Alicia LeGrand-Riniker

NewsTribune Reporter

Mike Blair’s business philosophy: Treat employees the way they “deserve” and the work environment will be better. That’s why he pays his employees $10 an hour and feels the national minimum wage should be raised.

Blair, the owner of Mike’s Pro Shop in Spring Valley, has three part-time and three full-time employees. Being a manager and owner has taught him one important thing.

“If you pay them a decent wage, you get more quality work,” he said.

After opening his car repair shop, he decided to also hire some high school students and pay them $10 an hour instead of the Illinois standard minimum wage of $8.25.

“They stay with me. They do good work,” said Blair. “It’s more of an incentive for them to want to come to work and do a good job if you are paying them a decent wage and coaching them.”

He said the way people treat their employees dictates what they are going to get out of them.

“I have seen a lot of people struggling,” Blair said about his time working minimum wage jobs and as a manager for companies that paid minimum wage.

Blair managed “hardworking” people for years who did not earn much over minimum wage. Blair said his workers received a 3-percent raise each year, but their insurance also would go up and many felt they could not get ahead.

“To me they were worth a lot more than that,” he said.

Blair tried fighting for the employees under him and asked that they receive higher wages which never came about. He said he wanted management to see that every worker, no matter how small the job, mattered to the company and helped it make money.

Many people argue that minimum wage jobs are for high schoolers and retirees, said Blair, but he has seen a change in this pattern in recent years.

Blair said he knows a lot of people who were making decent wages but were laid off and had to return to the workforce in a minimum wage job. Also, people coming out of college, like Blair’s two nephews, cannot find work and pick up minimum wage jobs in the meantime. Blair said it’s hard to pay college loans back and pay daily expenses with those types of jobs.

He believes that raising the minimum wage would be a step in the right direction in helping these people get back on their feet.

“I think our economy is in a rut right now and we need to do something about it,” said Blair.

President Obama has been working to get the U.S. House and Senate to pass an increase in minimum wage.

“There’s a bill right now in front of both the House and the Senate that would boost America’s minimum wage to $10.10 an hour,” the president said after signing his executive order on Feb. 12 to raise federal contractors’ pay to $10.10 an hour. Gov. Pat Quinn also wants to raise Illinois’ minimum wage to at least $10 per hour.

Obama said passing a minimum wage increase would have a positive effect on 28 million Americans and lift them out of poverty immediately.

Blair said this raise also could help the business world by improving employees’ satisfaction and work performance and creating fewer job turnovers which means less hiring expenses for businesses.

“When you are making minimum wage, you are always looking for something else,” said Blair.

He said he has heard arguments that raising the minimum wage will cause layoffs because businesses will not be able to afford it. He believes that most businesses can find a way to cut costs and still pay employees.

Blair added that an extra $1.85 an hour doesn’t seem like much, but to the people struggling to get by it means everything.

No: It’s not intended to provide income for families

By Rachel Stella
NewsTribune Reporter

Nathan Pappas owns five McDonald’s restaurants in Peru, Oglesby, Streator and Morris, employing about 350 people. His new workers start at Illinois’ minimum wage of $8.25 per hour and are given a 10- to 15-cent raise after three months.

The majority of his workers are paid between $8.70 and $8.75 per hour, he said.

If the minimum wage is raised to $10 or more per hour, Pappas said “it would restrict my abilities to train new workers.”

Pappas said a minimum wage increase would require him to find higher-skilled employees.

“Minimum wage was never intended to be providing an income for a family,” Pappas said. “It’s a way for people to learn on-the-job skills they would need to advance further.”

He couldn’t keep the wages of his higher-level employees the same if the minimum wage went up, he said, because their skills and responsibilities were worth more.

“It would force me to raise everyone, not just the minimum wagers,” he said.

Pappas said in order to compensate for the revenue loss a minimum wage increase would cause, he would have to cut some of his entry-level staff.

“I would probably have to cut those who don’t have the job skills, and replace them with those who do,” he said.

Tuesday’s report from the Congressional Budget Office estimates that 500,000 employees could lose their jobs if the federal minimum wage were raised to $10.10 per hour, as President Barack Obama required federal contractors to pay their employees by an executive order he signed Feb. 12.

Marci Duro, executive director of Illinois Valley Area Chamber of Commerce and Economic Development, said because Illinois’ minimum wage already is higher than in neighboring states — $7.25 per hour in Indiana, Iowa, Wisconsin and Kentucky; $7.40 per hour in Michigan and $7.50 per hour in Missouri — businesses could more easily choose to settle there rather than here.

“I just don’t know what they’re thinking right now,” Duro said of Gov. Pat Quinn’s push to raise Illinois’ minimum wage to at least $10 per hour, detailed in a Jan. 19 news release from his office.

“There’s probably two sides to that story,” said Boyd Palmer, executive director of Ottawa Area Chamber of Commerce and Industry. “Any increase in minimum wage will result in higher costs for goods.”

Rich Vollmer, owner of Pavers and More in Ottawa, says he pays all his workers more than the minimum wage, but an increase would cause “a little bit” of difficulty.

“Businesses have to recoup,” Vollmer said. “I think we’re going to see some price increases.”

Vollmer said if a minimum wage increase pushed him to make hard decisions, he would rather take the route of increasing product prices for consumers than cut staff.

“I would have some very modest price increases,” Vollmer said, adding he would “not compromise the number of employees to hurt customer service.”

Palmer said each business would be affected differently by a minimum wage increase, and the results wouldn’t necessarily all be negative.

“Is there a right answer? I don’t know that there’s a right answer — yea or nay,” he said. “It’s all relative.”

Tony Rigazio was the owner of WorldTronics International in Oglesby from 1976-2006. His company manufactured parts for appliances, and he said he always paid his workers more than the minimum wage because they worked in a “free trade zone.”

“It never affected us that much,” he said. “All manufacturers pay more than that. Nobody’s going to be affected by (a minimum wage increase), except a few people.”

Rigazio said he didn’t think minimum-wage employees were a large percentage of the working population.

Morgan Wilson owns Wilson Landscaping Co. and Nursery in La Salle. He said although he starts his workers at $12 per hour, he’s not in favor of a minimum wage increase.

“I don’t think it’s a good idea, nationally, because most of the jobs that pay minimum wage hire mostly kids,” Wilson said. “Minimum-wage jobs are for people entering the workforce — it’s a stepping stone.”

Rigazio said although he wasn’t against a minimum wage increase, he felt it was a distraction from real job issues.

“It’s all political,” he said. “I think we need more jobs and better jobs.”

Wilson agreed.

“I’m not looking to get by as cheaply as possible,” he said, saying when he occasionally hires high school-age workers, he pays them $10 per hour. “I think it’s a ruse or mirage that Obama’s putting out.”

Rigazio insisted that raising the minimum wage wasn’t the answer for new workers.

“I have nothing against $10 an hour,” he said. “I love the young people and I want them to advance. My heart just aches for the young people who are just looking, looking, looking (for good jobs.) (Raising the minimum wage) is not a big issue that’s going to help the economy.”

Reader Comments

Posted: Tuesday, February 25, 2014
Article comment by: Amy Flanery

First of all, these articles present the views of the sources, not the reporters, so please do not presume to know what our staff's personal beliefs or personal lives are.
Second, if you look again you will notice this post has two authors, each of whom undertook to present a different perspective on the issue. The political comment you referred to was not even in Mrs. Riniker's portion of the story. She wrote the side reflecting why some people are in favor of an increase in minimum wage.
Finally, you are correct that it would be helpful to have the minimum wage workers themselves speak up and give their opinions. Unfortunately, none of them wanted to talk to us. Maybe they are concerned about repercussions at their job if they did, but for whatever reason — they aren't talking.

Posted: Tuesday, February 25, 2014
Article comment by: METALWORKER

When I hear the arguments over giving the min. wage workers a lift, I hear things that Lincoln must have heard when trying to free the slaves.
You know, things like, plantation owners provide the things the country needs to grow.
You know, food, Tabaco, cotton, and we already feed, house and cloth them.
Free them and many will be homeless and with nothing to do.
U say that most of the min wage jobs are held by high school kids, wow, what a huge lie.
I am now retired and do things now I once could not do.
I can go to places like the Olive Garden, Red Lobster, Applebee's for lunch. I can go to Walmart, Target, and stores in the mall during the day. I upon occasion will get a sandwich at McDonalds, Arby's Burger king, and other fast food places and guess what. No high school kids.
The people serving me are the same moms I see in church on a Sunday with tow or three youngsters along side them. Most are single moms, few dads.
I see them, the ones who serve me food during the day, at Little league games, soccer games, track meets, when not working, cheering the youngsters on.
Good moms. Hard working moms. Todays plantation workers, not high school kids.
I have no idea what country U live in but it aint where I live.
High school kids go to school during the day and play football and basketball and baseball in the eve.

Come on News Trib. talk to the single moms working these min wage jobs during the day and not a group of marginal buss. owners who, if they do succeed, you know, get rich, will have done so because of the hard work of low wage workers.
Yes people are needed to start these places and they should be rewarded for their efforts that is true but with out hard working honest people doing the grunt work they will never make it.
So Rinker, like most N T reporters you ended a half a story by bad mouthing our pres.. All his fault. Might I suggest Rinker that U would pay your baby sitter, if you have one, more than $8.00 per hr. Or expect your daughter, if you have one who baby sits to earn more than min wage?
Did you earn more than min. and get health care paid for? Fill us in please.

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