Minimum wage increase draws mixed opinions from business owners, chamber of commerce

4 years ago

PRESQUE ISLE, Maine — As local businesses across Presque Isle and surrounding communities see a rise in the minimum wage required for employees, the reaction from business owners and local experts is mixed.

On Jan. 1, 2020, Maine’s minimum wage shifted from $11 per hour to $12 per hour. Earning a dollar more every hour may seem negligible to some, but the change makes a big difference in the finances of employees and employers alike. An employee who is working 40 hours a week at minimum wage will earn about $2,080 more every year before taxes.

LaNiece Sirois, executive director of the Central Aroostook Chamber of Commerce, said that the chamber has no official stance on the minimum wage increase, as the Chamber typically remains neutral on policy issues. 

She said there are pros and cons to the increase. For minimum wage workers, she said it would offer them a higher standard of living and the potential to further contribute to the local economy.

“Instead of living paycheck-to-paycheck, they have the opportunity to put a little bit aside to take care of those everyday things, like car repairs or how to get to work,” Sirois said.

But for small businesses with several employees making minimum wage, expenses could skyrocket.

“They are going to have to find themselves cutting expenses, increasing prices,” Sirois said.

Sirois was unsure whether the wage increase would positively or negatively impact the local economy overall, saying that the chamber would need to monitor how the economy functions with the new minimum. 

Sonny Gustin, bookkeeper of the Irish Setter Pub in Presque Isle, and husband of owner Debi Gustin, said the uptick in the minimum wage would cost his business about $25,000 extra this year. 

Gustin said that this is nothing new, as the minimum wage has increased every year for the last few years in Maine. He said he and his wife have learned to accept the resulting cuts in expenses. 

“We’ve done all we can do,” Gustin said. “Shortened hours. Had people come in later. Not much more we can do than that.” 

Gustin said the pub’s new menu, which they will unveil in the coming months, will reflect price increases resulting from the minimum wage increase. While he fears price increases could drive away customers, he saw no other choice. 

“The restaurant business is a very low margin industry,” Gustin said. “We work very hard to make probably less than 5 percent profit. When something like this comes in, it eats the whole thing.”

Not all business owners feel that higher minimum wages necessarily hurt businesses. 

Michael Stiggle, owner of Timberwolves in Mars Hill, said the minimum wage increase might have played a role in the increased cost of food for his restaurant.

Yet, Stiggle did not think that resulting price increases would affect customers, who he said tend to be able to spend a little bit more on their nights out. 

“We get a lot of professionals, so they just want good service and good food,” Stiggle said. “The price isn’t really that much of an issue.” 

Mark Carmichael, co-owner of the office supply store Northern Business Products in Presque Isle, said no one at his facility made minimum wage, and that was intentional: people wouldn’t be able to live off of it.

“People need to make money, and I have no problem with people making money,” Carmichael said. “You can’t pay your bills when you are making $8 an hour, trust me.”

Several businesses contacted said they were not affected by the minimum wage increase, as they had no employees earning minimum wage. Others did not respond to attempts at contact.