Business economists aren’t worried about minimum wage hikes, with one major exception: Those in the service industries that would be most affected.
Almost three-quarters of business economists surveyed by the National Association of Business Economists said their companies wouldn’t be affected by minimum wage increases.
Nearly one in three in the service sector, however, responded that a higher minimum wage would hurt their business, either by forcing them to reduce hiring or by reducing profits.
Minimum wage workers are disproportionately employed in the service sector, especially in food preparation and other restaurant jobs. The staunchest political opposition to raising the federal minimum wage comes from restaurant and other service industry trade groups.
The economists were responding to a quarterly survey sent out by the group that included special questions about the effects of the election and minimum wage hikes. In general, the economists weren’t concerned about either one.
“Election uncertainty and potential increases in the minimum wage do not appear to be impacting business decisions in the aggregate, although these issues are a greater concern for panelists in some subgroups,” said Emily Kolinski Morris, the chairwoman for the survey and the chief economist for Ford Motor Co.
A previous survey had found that a slim majority of economists favored some form of minimum wage increase.
Businesses are planning now for high minimum wages across the country. Since 2014, 13 states have enacted minimum wage hikes, as have several cities. New York and California, in particular, have moved to raise their hourly wage floors to $15. Several states have referendums on raising their minimum wages on their Nov. 8 ballots.
Hillary Clinton has backed a $12 federal minimum wage, up from the current $7.25, and has expressed support for raising it to $15 on a regional basis. Republicans generally opposed President Obama’s efforts to raise the minimum wage to $10.10 an hour. Obama has since backed a $12 federal minimum wage.
