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Virginia minimum wage increase sparks debate

VCU student: '$9.50 an hour is not that much of a difference, but... it makes a difference'
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Posted at 7:53 PM, May 02, 2021
and last updated 2021-05-02 19:53:29-04

RICHMOND, Va. -- For the first time in more than a decade, Virginia has raised the hourly minimum wage for workers -- sparking a debate over the benefits and downsides.

The change comes as many business owners are still feeling the economic toll of the pandemic, so some critics are especially concerned about the timing of the move. However, others say it's been a long time coming.

VCU student Mallari Mason used to feel anxious about reporting to her minimum wage job.

"Every time it would get to before I had to go to work, I just had this dread in my stomach like I didn't want to go," she said.

Mason worked for a fast-food restaurant and often felt unmotivated before her shifts partly due to the $7.25 she made per hour.

"I was a cashier and also the pay was super low," Mason said. "I'd work five hours and only make $35 which is nothing."
Fastforward to May 2021, and Virginia has increased the minimum wage for the first time since 2009 to $9.50 per hour.

It's part of new legislation passed by a Democrat-controlled General Assembly that increases the hourly rate each year until it reaches $12 in 2023. After that, state lawmakers would have to vote again to increase the minimum wage to $15 in 2026.

Mark Smith
Mark Smith is the owner of several Midas Richmond car repair shops in Central Virginia.

Reacting to the move, Mark Smith, who owns several Midas Richmond car repair shops in Central Virginia, said he is "all for it."

Even still, he doesn't think it goes far enough.

"I think that approaches a living wage, but I think it's still short," Smith explained. "I applaud the effort for the increase, but I also understand people need to pay their bills."

Smith said he starts all his employees at $15 an hour at the lowest, calling it the key to achieving a stable workforce.

"At the end of the day, I'm in the people business," Smith said. "I've got to take care of these people who in return take care of [the customers]. It's a big circle. It's my job to make sure they come first."

He mentioned the most common argument he hears to increasing the minimum wage is that business owners can't afford it.

His response to that is "you can't afford not to."

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Nicole Riley is the Virginia Director for the National Federation of Independent Business.

Nicole Riley, the Virginia Director for the National Federation of Independent Business, is a strong advocate for small business owners in the Commonwealth. She urged lawmakers not to pass the minimum wage hike.

"We are worried about the pressure this is going to put on small business owners, particularly those that are still trying to kind of get back on their feet from the pandemic," Riley said.

She believes a "one size fits all" government mandated raise only works for big companies.

"They have the resources and revenue to absorb the increase in labor costs, whereas a small business, their profit margins and resources tend to be a lot smaller," she said.

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Minimum Wage

Riley said many small businesses may be forced to make tough decisions to adapt to the new policy.

According to her, that includes eliminating entry level positions, moving to more automation, outsourcing some functions, charging more for services or goods, and as a last resort, closing down.

"Small business owners will do their best to innovate," Riley said. "It just might not have the outcome that advocates would like to see, which is all these people employed at a $15 an hour wage."
Riley also mentioned the impact of the raise will stretch across the whole workforce and not just the lowest earners.

She gave this example: "Take somebody that's making $13 an hour right now. As [minimum wage] increases, and they see a first-time employee coming in making a significant more or a bit more, they're going to want a raise."

VCU student Mallari Mason
VCU student Mallari Mason

As Mallari Mason continues her studies at VCU, she doesn't plan on returning to a minimum wage job but expresses new optimism for those who do.

"$9.50 an hour is not that much of a difference, but I think in the long run, it makes a difference," Mason said. "So I definitely think it'll help, especially with the price of living going up."