Will the Massachusetts Minimum Wage Increase Affect Your Small Business?

by | 27 Jun, 2017

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The recent sweep across the nation to increase minimum wage has been affecting both large and small businesses. The increase, which began in January of 2015 for the state Massachusetts, is now at an all-time high of $9.00 an hour for minimum wage workers. But the wage increase doesn’t stop there. Over the next few years, Massachusetts employers can expect to see two new wage increases. In January 2016 wages will be raised to $10.00 an hour and in January, 2017 wages will be raised to $11.00 an hour.

Ramifications of Minimum Wage Increases

Many businesses will undoubtedly be affected by these mandatory wage increases, and many may be forced to increase the prices of their goods and services in order to offset their increased payroll costs. For those businesses who are competing on price, this could have the compounding negative effect of increasing the cost-to-customer creating a competitive disadvantage.Additionally, this minimum wage increase may force business owners to demand existing employees be more productive because increased payroll costs for existing staff have the potential to preclude additional staff from being hired, even if the company workload increases.This Wall Street Journal article addresses how some small business owners are rethinking their business models and the way they allocate staff in an effort to keep payroll costs low.

Tom DiSilva
Tom DiSilva has been providing professional human resource services for over 30 years. As the CEO of Navigate PEO, he actively partners with organizations of all sizes in the Greater New England area and across the country to help their businesses grow. He has expertise in HR and Labor Management, offering guidance and support for key areas of business such as negotiations, operations management, employee coaching, and employee benefits design. He is an active member of The Society for Human Resource Management (SHRM), The National Association of Professional Employer Organizations (NAPEO), Professional Association of Co-Employers (PACE), and The American Payroll Association (APA). He is deeply committed to giving back to the community both personally and through Navigate Cares, which provides support for several nonprofit organizations such as the USO, The Boys & Girls Club, and the 3Point Foundation.

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Disclaimer: this article does not represent expert advice and is provided for informational purposes. Please get in touch if you would like expert HR advice.