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Jan-26-2016 17:21printcomments

Salem Chamber Speaks Out Against Minimum Wage Increase

Salem Chamber's CEO explains wage increase consequences for Oregon’s small businesses.

oregon minimum wage
Salem-News.com

(SALEM, Ore.) - The Salem Area Chamber of Commerce went on the record with an overwhelming "no" on raising the minimum wage, saying it would continue to vigorously oppose any efforts to artificially raise minimum wage in the state.

In a recent letter to the Senate Workforce and General Government House Business and Labor committees, the Salem Chamber stated its opposition to raising the minimum wage, siting that it placed the cost of a war on poverty on Oregon's small businesses.

“Will this legislation strengthen or hinder the ability of the private sector to grow and create jobs for area residents?” For our Chamber and our membership, made up of 80% small businesses, the answer to that question as it pertains to raising the minimum wage is an overwhelming no, and as such we continue to vigorously oppose any efforts to artificially raise the minimum wage in our state.

Please consider the following points:

  • Raising Oregon’s minimum wage places the majority of the cost of a war on poverty on an already vulnerable class of employer, Oregon’s small businesses.
  • Artificial inflation of the minimum wage creates the costly unintended consequence of wage compression, which forces additional payroll expense increase up through all levels of wage within an organization.
  • The likely result of a substantial payroll increase on our small business members will be higher costs, slimmer margins and a lessened ability to compete across multiple markets. Higher payroll will result in higher costs all along the supply chain, which in turn will raise prices of products for consumers.

The letter went on to say that it would send a message that Oregon is even less friendly to business, and that time and energy would be better spent attracting businesses and family wage jobs back to Oregon.

With regard to preemption, removal or manipulation of this policy will further hinder wage disparity in Oregon, forcing some employers to make tough decisions relative to relocation. Removal of preemption will also create new layers of HR administration never before seen in Oregon for employers operating in multiple municipalities.

This step would send the clear signal that Oregon is even less friendly to business than it already is.

While we applaud the intentions of our representatives, it is important to note that even the best of intentions cannot rewrite economic principles. If you raise the minimum wage, there are likely to be real, painful and weakening consequences for Oregon’s small businesses.

  • Oregon's minimum wage is currently the eighth highest state minimum wage in the U.S.
  • 8% of Oregon's workforce earns minimum wage.
  • Fewer than 1 in 6 Oregon minimum wage earners are employed full time.

View more Oregon minimum wage statistics HERE.

The letter continued:

Lastly, we firmly believe that Oregon doesn’t have a minimum wage problem. Rather, Oregon has a jobs problem. As such, your time – all of our time - would be far better spent looking for opportunities to make Oregon more attractive to business, and working to bring back the family wage jobs that Oregon was once known for.

That rising tide would truly raise all ships, rather than raising some at the expense of others.

Signed, Sincerely, Dan Clem CEO, Salem Area Chamber of Commerce

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