Proposition 206: Minimum wage hike would impact struggling workers, small business owners

Posted at 8:32 PM, Nov 06, 2016
and last updated 2016-11-07 11:59:45-05

If you have not voted already, one big decision you'll have to make on Tuesday is whether to raise the minimum wage in Arizona.

Proposition 206 means a gradual increase of the minimum wage from about $8 an hour, to $12 an hour by 2020. It would also mean the right to earned paid sick time for employees.  

Jose Garcia had worked in the fast food industry for 14 years. He had lived on a minimum wage salary and knew the struggles firsthand. He also felt for the working mothers and fathers who were trying to support a family on that salary.

"After all my bills, rent, lights, food, transportation I had maybe $50 left," Garcia said. "It's very hard to survive on that."

According to those with the Arizona Health Working Families initiative Prop 206 would be a "game-changer" for more than one million Arizonans who were struggling to make ends meet and live healthier lives.

Garcia said with more money to spend, that would be a boom for businesses who would greet more customers; it would also mean a boost to the overall economy.

However, the Arizona Chamber of Commerce and Arizona Restaurant Association said that's not exactly the case. Business leaders said small business owners would feel the biggest impact of this wage hike.

"If you're a small business with one, two, or three employees you'll be hit with nearly a 50 percent cost hike in your labor cost," said Garrick Taylor, a spokesman for the Arizona Chamber of Commerce.

He added that this would mean business owners would be forced to cut hours, cease hiring, raise prices, or use more automation and cut out human employees.

"If you look at the experience of say Seattle, they also had a large mandated wage increase," Taylor said. "There are now 1,000 fewer restaurant jobs there."

If it passed, Prop 206 would go into effect in January.  

Taylor said entry level workers would hurt the most because many business owners may add job duties to those already working, and instead cut out the entry level positions.

"The new hire is getting paid what you're getting paid after paying your dues there," Taylor explained. "Currently the question is: Can your employer afford to give you a raise? Probably not. You're not going to see the same raise as the entry level person will."

He said while they understood the hardships of those struggling to make ends meet, the community needed to find better ways to promote upward mobility — without putting the expensive mandates on job creators.

Those who support Prop 206 say the wage increases and sick-time benefits were long overdue.  

It would allow people to take time off to care for themselves or a loved one without worrying about paying their rent or putting food on the table.  Right now almost a million workers do not have access to earned paid sick days.