PUTNAM POSTING: Minimum Wage Increases, Other Regulations Pressuring Small Business
Jennifer Maher | January 2016
To tackle a difficult subject, I enlisted the opinion and help of a friend, past CEO of the Mahopac-Carmel Chamber of Commerce and present President/CEO of the Chamber of Southern Saratoga County Pete Bardunias.
From time to time we have teamed up to share business insights from both ends of Tech Valley and the Hudson Valley on important issues, and 2016 has brought quite a few new regulations to small business owners. We believe that the minimum wage increases now going into effect are presenting special challenges to our business communities.
Imran Siddiqui, owner of a Domino’s Pizza franchise in Halfmoon, NY (Saratoga County) mentioned recently that small businesses like his may be in danger of closure, because “my payroll will go up by $1,500 per week without any additional increase in sales.” Similar sentiments exist here in Putnam County, where small business drives the local economy.
The main issue is whether the mandated increases can safely be absorbed by local businesses without forcing cutbacks in staff size and/or services. In Saratoga County, where some farms compete with fast-food franchises for workers, they have moved away from hiring 14 and 15 year olds who have used those jobs to gain work experience, in favor of experienced immigrant workers. Also, some industries struggle to find workers right now, even though they already pay the wages the “Fight For 15” movement seeks.
Manufacturing companies need workers with a minimal amount of training who wish to pursue careers in industry, and report considerable frustration in not being able to obtain them. It begs the question—with all these good quality jobs available, why incentivize workers not to gain the necessary training to pursue living wages in manufacturing companies, especially given that many of these companies will actually pay for the training?
In Putnam County, entrepreneur and owner of several Verizon Wireless zones, David Robles says the increases have actually had the exact opposite results. His employees are paid minimum wage plus commission to wind up around $18-$20 an hour average. He used to give raises on the minimum wage portion based on performance reviews. “As a result of the increases, we have had to stop giving the raises. We have also had to eliminate our entry level and part time jobs. We have also had to lower our commission payout to get the employees to the same $18-$20 an hour,” he said. “This effects the sales motivation, causes higher turn over, less jobs, less sales. The result? My employees actually make less with the increases in minimum wage and my bottom-line is effected. This on top of tax increases, inventory cost increases, rent increases, health insurance costs increases. We need small business and health care reform or we won’t last.”
Regulations are mounting on small business, due to state and federal decrees regarding taxes, employee relations, health and safety requirements, the Affordable Care Act and now the minimum wage.
Both Pete and I understand that our organizations (Putnam County Chambers of Commerce and the Chamber of Southern Saratoga County) represent members whose opinions may differ on these subjects, but wanted to recognize the very real burden this mountain of government requirements is placing on the business community.
Setting the 2016 Legislative Agenda
The Business Council of New York State has set another aggressive agenda this year, calling for various legislative reforms in Albany and for infrastructure, education and workforce development investment to bring our state’s economy forward. The Putnam County Chamber of Commerce is setting a legislative priority plan that additionally focuses on our local and county-wide concerns.
To help build our economic future, Putnam County, in a county-wide partnership with its six towns and three villages, applied through the Governor’s Consolidated Funding Application process to prepare a feasibility study. This study would involve collaborative problem solving to offer solutions for the infrastructure development we need to make Putnam a viable place for businesses to become established or expand—especially emphasizing tourism and arts-and-culture. We requested funding for a $250,000 study; however the state award came back at $50,000. Putnam County Planner Barbara Barosa and a team of knowledgeable people will now be working with these funds to put together the basis for future applications for projects that will, hopefully, be funded in the next round of the CFA process. The Mid-Hudson Region did not win one of the Upstate Revitalization Initiative awards, but did receive more than $90 million for 2015’s project applications. Putnam received $475,500 and shared in a couple of regional program awards.
We now look forward to pulling together this county-wide feasibility plan. With new people in leadership in our County Legislature and new Supervisors in Patterson and Putnam Valley as well as some new faces on Town Boards, we can look forward to continuing our positive relations with our elected officials. We will be holding our annual Elected Officials Forum on March 13th. Each year these collaborative get-togethers have resulted in building better communication among our leaders at the local, county, state and federal level. The Putnam County Chamber of Commerce will continue to work with our elected officials to promote business-friendly, community-conscious development so we can all enjoy and prosper in this 21st Century.