Buffalo, NY (WBEN) Minimum wage workers in New York and more than a dozen other states are getting a raise today. A labor expert says this will be good not just for the employee, but the employer.
"Anytime you can get a raise it's a great idea for the workers," says Art Wheaton of Cornell University. "It really helps the economy because everything you give to the low wage workers they will immediately put back into the local businesses, so it's a win win for everyone to give an increase in the minimum wage."
The wage hike to $8.00 an hour may have a bit of an impact on employers, notably being more selective in hiring. "Employers will sometimes have to balance how much they can offer and the quality of the employee they can hire. So if the wage is higher than they're comfortable with, they will look for more qualified people willing to work for that wage," explains Wheaton.
The impact on prices may not be so big. "Since it's going to unilaterally apply to every business, all of their competition will face the same cost, so the competitive structure will stay the same," notes Wheaton. "The amount they pay workers are 8-20% of the costs. If you raise their wages by less than 10 percent, you may have to raise your prices one percent. It's not a dollar-for-dollar increase."