Quad City Business Owners React To $9 Minimum Wage Proposal - News and Weather For The Quad Cities -

Quad City Business Owners React To $9 Minimum Wage Proposal


During the State of the Union, President Obama called on Congress to pass a raise in the minimum wage. The President argued the current $7.25 is not enough to keep a family above the poverty line. The President says $9 would help working families and spur the economy and spending.

The debate has business owners split on if they think it's a good idea. The minimum wage in Illinois is currently $8.25 an hour and in Iowa it's $7.25. With an increase to $9, a business owner would really be paying $11.28 when you add in the social security tax and unemployment tax.

"I make it livable, says Lucy Mahoney, "I have bills like everybody else, and I pay for my cell phone bill and rent."

Mahoney works at Fresh Deli in Davenport. She's been behind the counter for almost a year and has mixed feelings about a minimum wage pay increase.

"I would enjoy making more money, but if they lose their business, then I wouldn't have a job," adds Mahoney.

Her boss Ed Kraklio has been crunching his numbers since he heard the President's plan.

"As a small business owner with less than 20 employees, it's a little scary," says Kraklio, Co-Owner of Fresh Deli by Nostalgia Farms

He says paying his employees $9 an hour could be mean a 30% to 35% increase in his prices.

"We're going to be paying out more for the supplies we need to make our business run," adds Kraklio.

The other problem for Kraklio will be the effect a higher minimum wage has on current employees, like Mahoney, who may not get annual raises.

"In order to bring their pay up, people that haven't been here as long or are inexperienced or subordinates would be at equal pay," says Kraklio, "I couldn't give anybody higher pay, because that would jump us right out of the game."

However, some businesses support a $9 minimum wage.

"I think it's really fair," says Good Karma Shirt Co. Owner Lindsay O'Brien, "I know it's really hard to live off the minimum wage."

O'Brien is trying to grow her Rock Island business and she does not have employees right now. However, she does not think an increase in the current Illinois minimum wage of 48.25 to $9 would hurt her future business plans to expand.

"We want our employees to be able to make and be able to survive, especially in a tough economy," adds O'Brien.

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