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Issue of October 15, 2014
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Low minimum wage bad for women, families, business

My Opinion

February 19, 2014 | 11:49 AM

As a small business owner myself, I don't see the logic in business people arguing against increasing the minimum wage.

It's just not logical to pay people a wage that doesn't even cover basics like food, housing, utilities and transportation needed to get to work.

At $7.25 an hour, the minimum wage comes to just $15,080 a year for full-time employees. Think about cashiers or health aides, child-care workers or fast-food servers trying to make ends meet on $15,080.

Question of the Week
Do you think the minimum wage increase will help low-income wage earners?
How can you keep people fully engaged in the success of your business when they are distracted with worry about how they are going to pay rent or keep the lights on? How can they provide the best customer service when they are struggling to feed their family?

I know firsthand, you don't need to pay poverty wages to succeed. In fact, paying higher wages is truly beneficial for business.

Since opening our doors in 2002, LetterLogic has grown fast. We have no debt, have annual revenues approaching $30 million and occupy a large processing center in downtown Nashville with 50 employees. The Women's Presidents Organization named us one of the "Top 50" Female-Led Businesses in North America for three years running, and we made the INC 5000 list for seven consecutive years.

I know we would not have had this success if we paid minimum wage. Paying better wages has helped our bottom line, not hurt it.

My company has been successful because of our employee-centric culture. We believe that, if we take good care of our employees, they will in turn take great care of the customer. It works.

Our starting pay is $12 an hour, not $7.25. And we increase wages by an average of 20 percent as soon as the probationary period is over. We also pay 100 percent of our employees' medical, dental, disability and life insurance. We give them 10 percent of our profits monthly, distributed evenly regardless of job or title. We help them buy their first homes with grants toward down-payments. We allow them to bring their children to work when they need to. We reimburse tuition. And these aren't all of our employee benefits.

It's very good for our business. We can count on dedicated employees and higher productivity and morale. We save money with lower turnover and training costs and reduced mistakes. We have better customer service and satisfaction.

We don't count on other businesses and taxpayers to subsidize our profits by underwriting food stamps and other safety net assistance for our employees.

Why should I be subsidizing the profits of companies that pay wages their employees can't live on?

When I pay a starting wage of $12 plus benefits, my employees have more money to spend at other businesses.

The very least other businesses can do is pay a wage that allows their employees to afford the basics.

But today's minimum wage locks workers into a nightmare of poverty. It isn't a building block of the American Dream. Adjusted for inflation, the current minimum wage of $7.25 is worth less than it was in the 1950s.

The typical minimum wage worker is an adult woman. As Margot Dorfman, CEO of the U.S. Women's Chamber of Commerce, has said, "Keeping the minimum wage low keeps women and families down."

Last increased in 2009 to the inadequate level of $7.25, the minimum wage is overdue for a raise.

The proposal to increase the minimum wage in three annual steps to $10.10, and then adjust it yearly after that for the rising cost of living, is very reasonable. After all, the minimum wage would already be over $10 now if it had kept up with the cost of living since the 1960s.

Today, women own 30 percent of American businesses. The success of my company — and my personal success — is proof that the American Dream is still possible. But it's a possibility built on fair wages, not poverty wages.

Public opinion polls show that, across the political spectrum, Americans want to raise the minimum wage. President Obama, many members of Congress and many business owners want to "Give America a raise." Let's make 2014 the year we get it done.

Sherry Stewart Deutschmann is the founder and CEO of LetterLogic in Nashville, Tenn.

  1. print email
    February 20, 2014 | 06:47 PM

    Less than 3% of workers are paid minimum wage. Most of them are first time workers and under the age of 18. Get real lady! If you believe your words why stop at $10.10? Lets make it $20 or better yet $30! Why are you only paying your new workers $12.00? They would have even more to spend if you paid them more!

    Raising the minimum wage will hurt our kids wanting to work and be a job killer. Shame on you for wanting to kill jobs!

    I believe the Chamber of Commerce is wrong and this is why I do not support them.
    Chamber of Commerce = Chamber of Crony Capitalism

  2. print email
    Mini;mum Wage
    February 21, 2014 | 12:39 PM

    "Do you think the minimum wage increase will help low-income wage earners?" is the wrong question. Obviously it helps the wage earner. The question should be, "How does it affect employment overall?" Most studies indicate that raising the minimum wage increases unemployment, especially among youth and minorities.

    Tom Powers
  3. print email
    Why is this propaganda printed?
    February 23, 2014 | 07:10 AM

    Why was this Obama propaganda piece printed? Most "minimum wage" workers are paid at this rate for less than 6 months. Bravo for this lady paying higher - and 100% etc....that is her decision as a business owner, in a town that is very, very wealthy. Raising the minimum wage will only result in inflation. If I have to pay more, then I will also charge more. It rolls up.
    But then, when the goal is 10% of the population supporting the other 90%.....

    Deb Thornton
  4. print email
    February 24, 2014 | 05:14 AM

    Every time the minimum wages increases, business owners say it will be a "job killer"... It never has... Min. wage used to be for kids who didn't have to worry about paying bills, but with so many people out of work, they are forced to take these jobs to keep their homes... Fast food giants & Walmart can afford to pay a higher wage.

    ray wilson
  5. print email
    February 25, 2014 | 09:14 AM

    Conservatives state taxes are too high and they want less government.

    When the minimum wage is below the poverty level taxes are used to supplement the income of low income earners. This requires both higher taxes and more government to run the assistance programs.

    Government should not be supplementing the payroll of businesses.

  6. print email
    February 25, 2014 | 09:36 AM

    According to the 2012 census numbers, 10% of workers are paid below $10/hour.

    2% of workers paid below $10/hour are 24 or under.

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