The American Dream Needs a Fair Minimum Wage

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The American Dream Needs a Fair Minimum Wage

Summary: 
Lew Prince, co-owner and managing partner of Vintage Vinyl, makes the case from personal experience that as a business owner, raising the minimum wage can help both consumers and businesses succeed.

My life is a tribute to the American Dream. My business partner and I started with 300 record albums and a $20 booth at the local farmers market in 1979. Today, Vintage Vinyl is the largest independent music store in the Midwest. We stage 150 in-store concerts a year and are known internationally for recorded music in all forms.

We built our business on wages above the minimum. This has given us devoted long-term employees whose ongoing relationships with customers have been vital to our success.

The last two decades have been tough on the music business. We’ve outlasted a 20-store local chain and numerous regional and national chains. Most of those companies paid their employees minimum wage or barely above. My creative, dedicated, and better-paid employees won this life-or-death struggle for us.

While my competition dealt with the costly results of constant employee turnover, constant training costs, and the unsatisfied customers that turnover breeds, my employees added great value to my business.

Unfortunately, many American companies have been driving down wages to poverty levels that are too low for workers to live on and too low to sustain the consumer demand that businesses need to survive and thrive. In a race to the bottom, the winner ends up at the bottom.

The American Dream needs a minimum wage increase.

When we started our company in 1979, the minimum wage was $2.90 – that would be $9.50, adjusted for inflation in 2014 dollars. Even back then, it had eroded from the 1968 minimum wage level, which would be $10.94 in today’s dollars.

We never would have believed that 35 years later, the buying power of minimum wage workers – and millions of workers above minimum wage – would actually be lower than when we started our company. Today’s $7.25 minimum wage is terrible for our country.

Business owners like me have come together in Business for a Fair Minimum Wage to do everything we can to raise the minimum wage and strengthen the floor under our workforce, our customers, and our economy. We know that good wages make good business sense. In fact, a new national poll, co-released by Business for a Fair Minimum Wage, showed a strong majority of small businesses support raising the minimum wage to at least $10.10. Business owners said that a higher minimum wage would help the economy, increase consumer purchasing power, reduce employee turnover, and increase productivity and customer satisfaction. We'll keep making that business case for raising today’s inadequate minimum wage.

Minimum wage earners, living paycheck to paycheck, spend increases right away. Raising the minimum wage and adjusting it for the cost of living in future years would mean the buying power of our customers and our local tax base would not be undermined again by an eroded wage floor.

Companies that pay poverty wages count on other businesses and taxpayers to subsidize them. When full-time workers need the public safety net and charity to put food on the table or keep a roof overhead, we are actually subsidizing the profits of the mostly big chains that don’t pay wages their employees can live on. This perverts capitalism and is lousy public policy.

The American Dream isn’t functioning when people are falling out of the middle class instead of rising into it. Raising the minimum wage is a very efficient way to circulate money in the economy from the bottom up, where it can have the most impact in alleviating hardship and boosting consumer demand for businesses.

We can’t restore the American Dream without restoring the minimum wage.