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Small Businesses May Soon See Minimum Wage Hikes

Small Businesses May Soon See Minimum Wage Hikes

During his State of the Union address on Jan. 28, President Barack Obama vowed to break political gridlock in Washington by striking out on his own when it comes to economic issues. He promised “a year of action” and outlined his plan during the 65 minute speech.

“I’m eager to work with all of you,” Obama said. “But America does not stand still – and neither will I. So wherever and whenever I can take steps without legislation to expand opportunity for more American families, that’s what I’m going to do.”

He then called on Congress to support the Democratic proposal to raise the federal minimum wage to $10.10 per hour from the current rate of $7.25, adding that he will sign an executive order to increase the wage for some government contract workers.

While there is no telling when – and if – the wage increase will take effect, Obama encouraged everyone from companies and small-business owners to mayors and governors to take action ahead of Congress and increase the wages of their employees sooner than later.

“Americans will support you if you take this on,” he said. “This will help families. It will give businesses customers with more money to spend. It doesn’t involve any new bureaucratic program. So join the rest of the country. Say yes. Give America a raise.”

Widespread effects

Should the wage increase to the proposed rate, as many as 28 million workers across the country will be directly or indirectly affected, according to estimates from the Economic Policy Institute, as reported by CNN Money. For those working full-time minimum wage positions, it would mean an increase in pay from $15,000 to $21,000.

Already, there are plenty of state and local legislatures that have taken up the mantel of raising wages for their workers. According to CNN Money, New Jersey residents voted to increase minimum wage to $8.25 per hour, while residents in the Seattle-Tacoma area voted to increase the rate to $15 per hour – a wage that will soon spread to all city workers in Seattle.

It seems Obama has the nation behind him, as 71 percent of American voters support a raise in the minimum wage, including 52 percent of Republicans, according to a Quinnipiac Poll from Jan. 8.

Preparing for the increase

Small-business owners may soon be dealing with a major shift in their finances. Whether they choose to increase the wages of their workers ahead of the president’s proposed legislation or wait until the law changes, it’s is extremely likely that they will soon be paying their employees more. As a result, they will need to cut costs in other parts of their business. Reducing overhead is a great way to look after the bottom line. Instead of spending money buying expensive office equipment, small-business owners should look into corporate equipment leasing and financing.

For small-business owners in need of equipment for a variety of industries, they should turn to National Funding for assistance today.

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