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Impact of Minimum Wage Increase on Small Businesses

Date: 12/26/2006 | Category: Business | Author: Claire Reid

According to a survey by Discover Small Business Watch, a majority of small business owners do not predict any major impact from a minimum wage increase to their business.  In large part because they already pay their employees above the proposed minimum wage increase.  70% of small business owners say an increase in the minimum wage to $7.25 per hour would have no impact on their employee costs.  However, 29% do believe that an increase in the minimum wage will impact the price of goods and service they use.

There does appear to be a difference of opinion between employees and employers though when it comes to raise expectations.  37%of small business employees expect a wage increase in 2007, and 51% of them expect a bigger raise than the previous year. Only 9% of small business owners expect to give higher raises in 2007, while 61% of owners plan to give the same raises as in the previous year.

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