Montgomery businesses differ on potential minimum wage increase -- Gazette.Net



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Proposals to increase the minimum wage at the county or state levels have some Montgomery County businesses worried about the effect the bill would have on their bottom line, while others support a raise in the wage.

County Councilman Mark Elrich (D-At large) of Takoma Park has proposed a bill that would raise the county’s minimum wage from $7.25 an hour to $11.50 an hour over three years.

Similar bills have been proposed in Prince George’s County and Washington, D.C.

A bill also is expected in the Maryland General Assembly during the 2014 session to raise the state’s minimum wage to $10.10 an hour.

Many businesses in Montgomery that depend heavily on government workers and federal contracts are more focused on the immediate damage caused by the government shutdown, said Gigi Godwin, president and CEO of the Montgomery County Chamber of Commerce.

Godwin said she respects the county bill’s sponsors for trying to help people, but the uncertainty caused by the shutdown makes it a bad time to look at a county measure.

“I know their intentions are good, their timing is terrible,” Godwin said.

She said she believes the issue would be better addressed at the state or federal level.

Lori Rodman, an owner of Century Distributors in Rockville, which delivers cigarettes, candy and other products to gas stations and convenience stores, said the county proposal could drive her company out of the county.

“It would totally devastate our business,” she said.

All of the company’s approximately 180 employees make significantly above the current minimum wage. If the minimum wage rose, the company would want to maintain that differential, so pay for current employeees would go up proportionately, she said.

The move might mean the company wouldn’t contribute as much to profit-sharing arrangements or employee health insurance, or could cause a move to more part-time employees, Rodman said.

Century competes for business with companies in other parts of the state, as well as in Virginia, Pennsylvania, New Jersey, Ohio and North Carolina. Rodman said a higher minimum wage would let her competitors provide products more cheaply.

“This would definitely put us at a competitive disadvantage,” she said.

She said most people in Montgomery already make much more than the minimum wage.

“You can’t even get a baby-sitter for $7.25 an hour,” Rodman said.

But Meaghan Murphy, an owner of Capital City Cheesecake in Takoma Park, said it’s her responsibility as a boss to make sure employees can afford at least the basics needed to survive in the county.

Murphy said she supports the measure to increase the wage to the state level of $10.10 an hour, but isn’t sure she could afford $11.50.

Ultimately, the county will have to figure out what a fair wage is, but it clearly needs to be raised from its current level, Murphy said.

“It doesn’t intimidate us,” she said.

The business owners she interacts with already pay more than the minimum wage, she said.

Capital City Cheesecake employs eight to 12 employees at a given time, Murphy said.

They start at $8.25 an hour, but some employees make up to $14 an hour.

Del. Anne Kaiser (D-Dist. 14) of Burtonsville said she senses momentum around the state for an increase in the minimum wage; it’s a main issue that lawmakers seem to be talking about during the break between sessions.

Kaiser said raising the minimum wage would be better as a statewide issue to avoid causing any competitive disadvantage for Montgomery businesses. However, she pointed out that Elrich is working with officials in Washington, D.C., and Prince George’s on their proposals for a regional market with similar pay.

Kaiser said there’s an argument that some businesses would leave Montgomery if the minimum wage is increased, but she thinks most businesses are established in the county and would stay.

Rodman said a possible move has already come up at Century, mentioning an area that in recent years has gone out of its way to make itself attractive to companies disenchanted with Montgomery’s business environment.

“Frederick [County] is only 13 miles north,” she said.



rmarshall@gazette.net