At family owned Italian ice cream shop Gelati, there are about 25 employees. Almost all of them started out at minimum wage. Now, new proposal in Washington to raise the federal minimum wage could put them out of business.
“It would take away the bottom line,” said Paul Pitaro, Owner. “It’s marginal right now. We’re a seasonal shop.”
U.S. Representative Jesse Jackson Junior recently introduced a new bill that would raise the federal minimum wage from $7.25 to $10 an hour. He says it would help 30 million American workers and stimulate the economy. Here in Illinois, minimum wage is higher already, at $8.25.
“Their gasoline costs as much as our gasoline costs,” said Gary Ernst, Professor Emeritus at North Central College. “Their food prices are high. Everything has gone up. So on the surface for them it sounds like a great thing.”
But he says that the positive impact is only on the surface, and that if the country’s goal is fixing the 8.2% unemployment rate, this is the wrong path.
“For big businesses, they’ll probably do an instant hiring freeze, and maybe even a cut of their staff as part of their budget,” said Ernst. “For small, independent businesses, this can almost put them out of business for some.”
Naperville residents have mixed feelings on the idea.
“It’s necessary, especially in this time,” said Arlene Lannon. “It will help spending, help the economy.”
“They’re going to be passing on the cost to consumers when they raise the minimum wage because someone’s going to have to pay for it,” said William Colvin. “The shops can’t afford it.”
“As a college student, I think it would be super awesome just because it’s always nice to have a little extra cash in your pocket,” said Haley Hildenbrand.
But at Gelati, the young employees might not have jobs anymore if this gets passed.
“We love the kids that work here and we would love to be able to give them more money but we’re so thin right now it would just really hurt us big time,” said Pitaro.
Hurt them so much, they’d be making some tough decisions.
The last time the federal minimum wage increased was in 2009, from $6.55 per hour to $7.25.
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