Minimum won't do in SL
While few people in Storm Lake make minimum wage, employers disagree on whether a hike would benefit or harm business. With legislators predicting a hike soon, many businesses believe they will not be affected because they already pay well above minimum wage.
Tom Daniels, Executive Director of Hope, Faith & Charity, identified problems unique to the healthcare industry if the wage was approved. While FH&C pays much more than $5.15 to start, he says there may be a problem if the increase raises other wages accordingly. If the facility for profoundly handicapped children center is forced to pay more, he said, it may have to make do with fewer people. This would be hard, Daniels says, because a certain number of people are needed to provide the care patients need.
"With about 83 percent of out costs being employee costs, both pay and benefits, we don't have a lot of growth room," he said.
Much of health care's revenue is provided by Medicare and Medicaid.
Most providers rely on reimbursement for service from the government to keep their doors open. In the past, Daniels said, when minimum wage was increased, state reimbursements for healthcare services did not raise with it.
Statistics show in Iowa one third of minimum wage workers in the state are adults with children under 18 in their homes. In Storm Lake, few employers offer minimum wage.
"Most businesses I know of can't get away with hiring minimum wage workers," said Real Estate Specialists of Storm Lake Inc. owner Joe Aube. "You just have to pay more to get good people."
Donna Lee Bistrican, owner of Salt and Light Books, can't afford employees, but said if she could, she would pay more than minimum wage. She says businesses get what they pay for.
"I wouldn't mind seeing the minimum wage increase," Bistrican said. "If people make more money, they will spend more money."
Storm Lake Chamber of Commerce Executive Gary Lalone has not studied the effects of a minimum wage hike on the area and declined to comment on the issue until he has a chance to study it further. He said a recent study shows few people in Buena Vista County making minimum wage.
Daniels believes throughout Iowa the skills and expectations required in most jobs has increased to the point it is difficult to hire minimum wage people who are willing to do those jobs.
"We don't have people sitting at home waiting for a minimum wage job," he said. "The unemployment rate is not that bad."