Floridians will decide Nov. 3 whether to raise the state’s minimum wage to $15 with Amendment 2. Some argue it would make the difference between being able to pay bills and not, while others argue the toll on prices is simply not worth it.
If passed, the amendment would first raise the minimum wage to $10 per hour in 2021, followed by a $1 uptick every year until the minimum wage would stabilize at $15 per hour in 2026. For 2027 and beyond, it would then adjust for inflation.
The measure would also maintain the current rule for jobs where employees receive tips. According to the Fair Labor Standards Act, employers can pay $3.02 per hour less than the minimum wage to a tipped employee, under the assumption that the employee will make that money back in cash tips. This will remain the same if the amendment passes, meaning in 2026, a tipped restaurant employee’s minimum wage would be $11.98.
For some, this change could mean more immediate financial security when it comes to paying bills and having money left over. But, in the long term, some fear the change could lead to higher prices from the top down.
Brian Hill, owner of Brian’s Bar-B-Q in DeLand, said while he opposes raising the minimum wage so “aggressively,” he especially thinks doing so in the wake of the COVID-19 pandemic could spell danger for businesses in the hospitality industry, like restaurants and bars.
“Who knows how long it will take to work out the current situation?” he asked. “Regardless of your political party, regardless of your feelings on minimum wage, this is not the time to address minimum wage.”
Lisa Lombardo, owner of the Comfort Inn and Suites in DeLand, agreed with Hill. She said while she has no employees working for minimum wage in 2019, raising the minimum wage would cause her to raise all of her employees’ wages, which would mean much higher business costs.
The Beacon posted to local Facebook pages to ask users how they felt about raising the minimum wage, and answers were contentious.
“No, I feel $15 is too high for minimum wage,” one commenter responded. “It will be very hard for businesses to pay this high of wages, especially after the year we’ve had with pandemic.”
Common arguments against raising the minimum wage included the idea that prices would go up, and employers would be forced to cut employees’ hours or raise prices.
However, according to Dr. Alan Green, Stetson University’s chair of economics, no studies have shown drastic price increases or reduced hours in areas where the minimum wage increased.
“If it passes, the amendment will impact the labor market and prices for some goods and services,” Green said. “It will help workers at minimum-wage jobs, but may make it a little harder to find those jobs. Prices may increase some for some products, but widespread inflation is not likely from this increase.”
He added that, since the increase is not an immediate jump to $15, there would be time to adjust.
“First, the implementation is gradual, so businesses will have time to plan and adjust. Second, after 2026, the minimum wage will be indexed to inflation, so if it passes now, hopefully we will not need to change it again,” Green said.
Still, Green conceded that smaller businesses will feel deeper effects from a minimum-wage increase, and may have to raise prices or trim staff.
Harry Graham, owner of Blue Springs Brewery in Orange City, stressed this, as well.
“While I do think the wage gap is a plague of modern society, I don’t feel raising the minimum wage is necessarily the first answer I would support,” he said. “Amendments like this are going to do more to punish the small businesses, which view employees as a kind of family, whereas it was designed against the oligopoly corporations, which will simply pull a corporate restructure to make up the difference with significant layoffs.”
The complex relationship between the survival of small businesses and the desire to pay employees a living wage is something Green said voters will have to consider.
“So I see the trade-off of raising the minimum wage as raising some prices a bit for everyone, in return for providing what might actually be a living wage to hourly workers,” he said.
Among arguments in favor of the minimum-wage increase, some suggested the cost of living is just too high for such a low minimum wage.
“Yes, I think it needs to be raised,” said another Facebook commenter. “Take a look at what the price of a one-bedroom apartment goes for in this county! How is anyone able to afford the prices on the wages that are currently paid?”
A sampling of apartments for rent in West Volusia showed monthly costs at an average of around $800 to $1,000 for a one-bedroom, one-bathroom apartment. Rent alone, then, would take about 70 percent of the income of a worker putting in 40 hours a week at Florida’s current minimum wage.
Increasing housing costs was another reason Stetson’s Dr. Green said he supports the amendment.
“Low-skilled workers in the U.S. have seen major challenges over the past 30-40 years,” he said. “These include the decline of unions, competition from globalization, the rise of noncompete clauses in contracts, increasingly expensive and hard-to-access health care, and increasingly expensive housing.”
Some see the amendment as a bad way to alleviate income inequality. Hotel owner Lisa Lombardo said the minimum-wage hike could raise the barrier for high-school students looking to start in entry-level jobs and work their way to higher wages.
“We keep trying to call minimum wage a living wage, but for so many of us, we start at some entry-level beginning job and then we move into the next step or the next job to get cost-of-living or merit-based increases along the way,” Lombardo said.
Another concern some expressed had nothing to do with the minimum wage, but the process: Why use a constitutional amendment instead of a law to regulate the state’s minimum wage? There is precedent, however; an amendment is how Florida got a minimum wage separate from the federal minimum wage in the first place.
Voters have a lot to think about when it comes to Amendment 2, from the question of using the amendment process, to the possible effects on small business, to the problem low-wage workers face trying to make ends meet.
Florida’s minimum wage has changed incrementally over the past 15 years since an amendment passed in 2004 that guaranteed Floridians a minimum wage of $6.15, adjusted yearly for inflation.
This was, at the time, one dollar higher than the federal minimum wage of $5.15.
Since then, the highest inflation-driven increase came in 2009, when the minimum wage was increased by 42 cents. Most years, there was an increase of less than 50 cents, and some years saw no change at all.
The cost of living has steadily increased, though.
At the current minimum wage rate of $8.56, someone working a part-time job at 30 hours per week would make about $11,000 a year. This puts that person below the federal poverty line, which is, according to the U.S. Department of Health and Human Services, $12,760 for a household of one person.
But at 30 hours per week, if someone were to pick up a second part-time job, also at minimum wage, the person would double their income to about $22,000.
While above the federal poverty line, this would still place someone between the “very low” and “low” income classifications for Volusia County — even though he or she is working 60 hours a week.
As of 2018, the most recent year for which data is available from the county’s economic-development office, Volusia County’s average annual wage is $38,760.
— Noah Hertz