Will Michigan minimum wage increase impact small businesses?

 

BERRIEN COUNTY, Mich. – Michigan’s minimum wage is seeing a slight increase in 2023, going from $9.87 an hour to $10.10 an hour.

This raise is part of the state’s Improved Workforce Opportunity Act, passed in 2018, which aimed to raise Michigan’s minimum wage up to $12.05 by 2030.

But the timing of the increase—coming after a year of rising costs due to inflation and supply chain issues, have concerned some small business owners, like Brian Maynard, the owner of Forte Coffee in St. Joseph and Benton Harbor.

“Frankly that’s challenging when you have small margins,” Maynard said. “You have to have a certain number of people come through the door every hour in order to cover the cost of the employees that are working and make a reasonable profit.”

Ryan Boeskool, Executive Director of the Niles Regional Chamber, said that this wage increase will be felt by everybody in the state.

“Every employer will bake in the cost of the increase right into the costs of services and products and the consumer will see those passed along to them at the cash register,” said Boeskool. “It’s just part of the overall picture that’s going to have an impact on everything this year.”

Some businesses may even downsize.

“If it becomes just that much of a burden for the business owner, they may eliminate a minimum wage position to account for the overall salary line-item in their budget,” said Boeskool.

There are legal challenges to the new law—because state lawmakers adopted it and then amended it—so depending on what happens in court in the next month—the state minimum wage could jump to over $13 an hour.

ABC57 will provide updates on air and online as soon as we get them.