NFIB Massachusetts Says Minimum Wage Compromise will still Cause Job Losses

Date: March 13, 2014

Boston (March 13, 2014) – A plan to increase the state
minimum wage more than 30 percent in the next three years is better than an
alternative proposal but still too much for some small businesses, said the
National Federation of Independent Business (NFIB) today.


“It’s a good faith effort to soften the impact of raising
labor costs on small businesses but in the end it will add to the cost of
running a small business and force small businesses into making difficult
hiring decisions,” said NFIB State Director Bill Vernon.


Vernon reacted to news that Speaker Robert De Leo is
backing an increase over three years to $10.50 per hour.  The increase would be combined with some
reforms to the state Unemployment Insurance system intended to reduce costs for


“It’s a fair attempt on the Speaker’s part to accommodate
small business but the Unemployment Insurance reforms don’t address the
underlying problems with the system and for that reason they can’t really
offset the substantial increase in labor costs imposed by a much higher minimum


Vernon pointed to a recent study by the nonpartisan
Congressional Budget Office that predicted more than half a million job losses
nationally as the result of a federal bill that would raise the minimum wage to
$10.10 per hour.


“All of the versions that are under consideration on
Beacon Hill are more aggressive than the federal plan,” said Vernon.  “That means that the job losses would be at
least as severe in Massachusetts and job creation will be slower here.


“Small businesses that can’t count on a big increase in
sales to accommodate higher labor costs will find a way to reduce employment,”
he continued.  “They’ll eliminate
positions, lay off workers, cut their hours and look for ways to automate jobs
so they don’t need employees. That is the way the economy works.”


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