By Karl Terry and Sharna Johnson: Freedom Newspapers
As the clock ticked down on the 2007 New Mexico Legislature, a lobbying effort by Gov. Bill Richardson produced a state minimum wage.
Legislation to raise the minimum wage from $5.15 to $7.50 won final approval Friday when it narrowly passed the Senate.
Richardson called it the “crown jewel” of his legislative agenda.
The wage floor would go to $6.50 in January 2008 and $7.50 in January 2009, with exemptions for agriculture. Higher minimum wages already in effect in Santa Fe and Albuquerque would be untouched; other cities and counties couldn’t enact higher wage floors until 2010.
Rep. Anna Crook, R-Clovis, who has owned small businesses, said she was disappointed in the minimum wage bill passing, but believes it should be along the same lines as a federal bill in the works for some time.
“Having walked the mile, I know it’s difficult for small business,” Crook said. “I really do think it hurts our small business.”
Rep. Keith Gardner, R-Roswell, agreed with Crook’s assessment.
“The federal is going to kick in anyway, so I didn’t think it was necessary,” Gardner said. “I’m not a big fan. I voted against it because there was some language we didn’t want in the bill.”
Crook’s fear is that a state minimum wage will adversely affect young people just learning to work. She says that local businesses mostly use the minimum wage as a training wage, and few leave workers on that rate for long. She says that with a higher minimum wage businesses might not be as likely to hire young people.
Owner of Clovis’ Leslie’s Candy Co., Greg Southard, has been resigned to the fact the minimum wage would be raised in New Mexico.
“I have been anticipating this, and I think a lot of other businesses have as well,” Southard said.
He joined other local small business owners in an effort last year to lobby against the proposed legislation, but said he realized about midway it was an uphill battle that would probably be lost.
“We ran up against a brick wall,” he said. “It’s a reality of business, and we were just forced to adjust to it.”
Shortly after Christmas, he laid off a number of people in preparation, people he said he would have probably kept and continued to train.
Southard believes strongly the mandated increase will bring hardship to small business owners and to the region as well.
“It’s going to be bad for New Mexico business no matter what. The federal minimum wage (will be $7.25 by 2009). Why would any employer come to New Mexico to pay more for an uneducated, unskilled workforce?”
Additionally, prices and the costs of services will have to be increased to compensate for the hike in order to keep business doors open, he predicted.
Young people seeking part-time work will also suffer, he believes, because their adult counterparts will have superior skills and more experience, and likely get hired first.
Businesses will adapt eventually, but the community as a whole will feel the result, Southard said.
“It doesn’t help if people can’t get jobs, if they don’t have any skills and can’t get hired. In Curry County the effective minimum wage was probably closer to $6 an hour anyway. It should level out eventually when businesses have a chance to raise their prices.”
Anna Symm, a college student who works at a Clovis coffee shop, said the minimum wage increase would directly impact her. While it will help with school costs, she sees both sides of the issue.
“I think that’s great for me, but I do worry about some of the smaller businesses around here that are already struggling,” Symm said. “It kind of comes back around.”
She said she would expect higher wages in a larger city, but in Clovis and other small communities it is a lot harder for small businesses to make ends meet because they don’t have the same revenue afforded in other areas.
Glad to have extra income potential, the 20-year-old is still sympathetic to the plight of those business operators.
“I’m working for a small business right now and I know it’s hard. … For every action there’s an equal and opposite reaction,” she said of her belief there is a potential downside to the good news for employees. “Just because I’m working for someone else right now doesn’t mean I won’t own a business some day.”
The Associated Press also contributed to this report.