Montpelier Increases Minimum Wage

MinWageTHE NORTHEAST KINGDOM - The Vermont Legislature passed the minimum wage bill, S.40, from $10.50 an hour to $15 an hour by 2024 for tens of thousands of Vermonters. Proponents of the bill hope that by increasing wages it will allow Vermont workers to spend more money in the state and therefor boost the state's economy. However, employers could pay students three dollars less than the mandated $15 an hour.

 Lawmakers hope that this increase in wages will help reduce Vermont's poverty level. Which, according to VermontBiz.com, increased while the median household income increased only slightly. Vermont has the 14th lowest poverty rate, at 11.9%, but one of the faster growing rates of income inequality.

To show support for the bill before its passing, several members of the Legislature participated in a "Minimum Wage Challenge". Nearly 20 members tried living off of the state's minimum wage of $10.50 an hour and according to a survey most could not.

The survey found that almost none of the participants were actually able to complete the challenge and live within the budget. Food, rent, and transportation costs were some of the top reasons why participants failed. Some even saying in the survey they skipped meals or put off doctor visits to make it work for that one week.

Caledonia County State Senator, Jane Kitchell, voted in favor of the minimum wage increase. Realizing there could be impacts from the wage increase Kitchell said, "Experience can alter what may happen in that six years." Indicating that if the changes have negative impacts the Legislature could take steps to correct them.

Some had concerns that increasing the minimum wage could hurt Vermont's small businesses. "The Joint Fiscal Office took a heavy look at the possible impacts to small businesses, there's an anticipated response, but it was not very significant in the scheme of things," said Kitchell. "Yes, it could mean fewer workers hiring."

Talk of having to hire fewer workers was echoed by the owner of Lyndonville's Bagel Depot, Ralph Aussiker, along with the fear of having to increase prices. "If our prices are put out of range it's obviously going to effect business and if it effects business I probably won't be able to hire as many people."

Aussiker explained that as a small business owner it's not feasible to increase the minimum wage to $15 dollars an hour and keep competitive prices, which he fears could send customers elsewhere. Aussiker is also concerned about the impact the increase could have on his own income, "somewhere along the way we as owners have to walk away with a little bit of money."

Aussiker also was concerned over the idea of giving workers raises if the wages are already increased to a level they can't afford. "It takes away our, right now we struggle if we have a good worker, merit wages. If they raise it to where we're struggling anyways, how am I supposed to give a good worker a raise?"

Darcie McCann, Executive Director of the Northeast Kingdom Chamber of Commerce, wants workers to have a livable wage, but worries it's being increased too quickly. "The minimum wage is a tough one because you want someone to have a livable wage. The question is how quickly is it going to be implemented and often it's too quickly," said McCann.

The newly passed bill would increase the state's minimum wage from $10.50 to $11.10 in 2019, $11.75 in 2020, $12.50 in 2021, $13.25 in 2022, $14.10 in 2023, and to $15 by 2024. McCann also expressed a fear that by increasing the minimum wage could send businesses out of Vermont, "when states right next to you are nowhere where you are so you're losing businesses right and left, we hope not, and employees."

The bill is headed for Governor Scott's desk and could veto the bill. Governor Scott thinks that increasing the minimum wage could have negative effects on the state's economy.

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