Raising the federal minimum wage is a divisive topic, and there are good arguments on both sides.
Certainly in America, if someone works hard for 40 hours a week, he or she should be able to make enough money to survive. A single person today needs to make at least $31,200 to reach an adequate standard of living, according to the Economic Policy Institute. That's $15 an hour.
Raising the federal minimum wage would be a boost to the poorest working Americans and help close an ever widening pay inequality gap.
But, as the Tire Industry Association (TIA) put it in a joint letter sent to Congress to oppose the Raise the Wage Act in February, raising the minimum wage would hurt businesses already holding on for dear life during the pandemic.
TIA was among 31 trade groups that signed onto a letter to federal legislators expressing concern. Besides TIA, other aftermarket groups that signed include the Automotive Service Association, Specialty Equipment Market Association and Service Station Dealers of America and Allied Trades.
"Small businesses, ravaged by the COVID-19 pandemic, are struggling to keep their doors open and keep employees on payroll," according to the letter. "More than doubling the federal minimum wage presents a significant obstacle to ailing small businesses trying to survive the pandemic."
Pushing the federal minimum wage higher would cause smaller tire dealers to have to cut back on employees to cover the higher costs of the remaining workers, TIA CEO Roy Littlefield III told Tire Business last month.
Any increase to the minimum wage also would impact workers who already are making more money because as lower-paid workers earn higher salaries, higher-paid workers also would expect a bump in compensation, he said.
"Small businesses are having a really hard time competing right now," Mr. Littlefield said. "... You are getting hit with a lot of things, and it just cuts into the bottom line, especially now. It's not like you are making more money. You are lucky to be anywhere close to where you were last year and last year anywhere close to where you were the year before."
The Raise the Wage Act was eventually stripped from the $1.9 trillion stimulus package passed in March, but the conversation on pay isn't going anywhere.
When talk of raising the minimum wage made headlines last month, McMahon's Best-One Tire & Auto Care — which employs 100 at its seven retail/commercial stores in northeast Indiana — decided to embrace it, raising the minimum wage it pays to $15 an hour.
"It's certainly good for our employees and will help our local economy, but it also gives us a competitive advantage over other retailers," Kim McMahon, McMahon's Best-One president, said. "We invest in our employees and they in turn do a great job for us and for our customers.
"We believe that it's the right thing to do for our employees and that by having employees who are more financially comfortable will create an atmosphere where they want to stay with us for the long term, which will, in fact, lower our overall expense," she said.
Could the answer really be to steer into the skid?
We wonder, if the tire industry were to lead the way in raising the federal minimum wage, could it solve its biggest issues: Finding and retaining quality employees?