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How Florida's minimum wage increase could impact low-paid workers and small businesses

Wage to increase by a dollar every Sept. until 2026
Posted at 4:29 AM, Jan 06, 2021
and last updated 2021-01-07 02:37:57-05

TAMPA, Fla. — Minimum wage earners in the Tampa Bay area will have more disposable income. That’s because the minimum wage increased from $8.56 to $8.65 and will increase again in September by more than a dollar.

ABC Action News in-depth reporter Anthony Hill found out how the wage increase will impact workers and small businesses.

“I just feel like I do a whole lot of work for a minimum pay, you know.” Michael Harden said. He lives in Tampa and knows how it feels to work long hours and get paid a minimum wage. “When it’s time to pay bills and there’s nothing left over and you have kids to feed, you wonder what you’re going to do. So, thank God for food banks,” said Harden. He says it’s hard to get by on making $8.56.

Now, Harden and thousands of low-paid workers in the bay area are feeling more optimistic.

The state’s minimum wage increased by nine cents, pushing it to $8.65 and that’s just the first of several increases we’ll see. Back in November, just over 60% of Floridians voted “yes” to Amendment Two, which will raise the state’s minimum wage to $15 per hour in increments by 2026. Florida is the eighth state in the nation and the first in the south to amend its constitution allowing for a $15 minimum wage.

John Morgan is the founder of Morgan & Morgan Law Firm and has spent millions of dollars on the initiative to put the question to voters back in November on whether or not they would like to see the state’s minimum wage increase to $15.

He told ABC Action New In-Depth that the state's minimum wage just is not high enough.

“The reason that America is angry and uneasy is because of income inequality. Whether you’re a ‘Bernie bro’ or a Trump supporter, when you work and do all the right things and then go straight from work to a food bank, the system is broken,” said Morgan.

He is not the only one who believes the system is broken. Tampa has seen its fair share of fast-food workers protesting for what they call a living wage.

John Salas has owned Tampa's Florist for over two decades. It’s a small business, but it’s a staple in the community. He says 2020 has been bad for business due to the pandemic, but that the community has continued to support them. He believes it is about time people start receiving a decent wage, but that paying his employees $15 could have a negative impact.

“As a small business owner, I expect that it’s going to be hurting on us,” said Salas.

Mark Wilson, the president of the Florida Chamber of Commerce, has publicly come out against November's minimum wage ballot measure, saying it will hurt small businesses here. However, this is not the first time a minimum wage increase has been put on the state ballot. In fact, between 1996 and 2018, Floridians have voted 24 times to raise wages.

Dr. Robert Jones is a professor of economics at the University of South Florida. He explained the pros and cons of raising the state’s minimum wage.

“Short run, I think it’s hard to argue that what we’re seeing moving ahead won’t be positive for many workers and their families,” said Prof. Jones. He says if people have more disposable income, they can inject that same money back into the local economy and depend less on government and local assistance.

However, Prof. Jones says there are other issues that come with raising the minimum wage. He says, long term, businesses could possibly ship jobs to other countries where they can find cheaper labor or pass the increase in labor costs on to consumers.

Many economists agree that, ultimately, the minimum wage should be attached to inflation, essentially the cost of living. That is why when the state’s minimum wage finally reaches $15 in 2026, it will continue to rise with the state’s inflation rate.