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Thursday, March 28, 2024

N.C. lawmakers put a stop to minimum-wage hikes before cat gets out of bag

Many have wondered why the N.C. General Assembly included a provision in the controversial HB2 employment rights law that also blocks local governments from instituting higher minimum wage levels. Veteran Raleigh political observer Rob Schofield speculates that the N.C. Chamber helped to negotiate the action, which has received much less attention than the debate over discrimination against gays, lesbians and transgender people. (Chamber spokeswoman Kate Catlin says the Chamber had no input into the legislation, which it is now analyzing.)

We asked Senate Majority Leader Mike Hager, and his answer is straightforward: “We thought that was going to be the next issue to come up” in various city councils across North Carolina, and the Republican leadership wanted to nip it in the bud, he says. “We didn’t want to be spotty on this because it has statewide economic implications. We felt it should be dealt with by the General Assembly as a statewide issue.”

Hager also argues the furor over HB2 breaks fairly evenly between small and large businesses. “The small businesses in my district like this bill and think it is fair because it keeps more regulations and costs off them,” he says.

“Big business can afford to be politically correct, but that’s not the case for many small businesses.

Hager also calls it hypocritical for large companies — including Facebook, which operates a massive data center in his district near Forest City — to accept state-government subsidies and then demand lawmakers change their opinions on HB2.

Citing Google, American Airlines, Bank of America and others, “It is disingenuous for them to be willing to take millions of dollars in tax credits and other benefits, but then hammer us on this policy.”

Pressed on why state lawmakers should interfere with local decisions on minimum-wage levels, Hager notes that a higher wage in Charlotte or Greensboro could cover every company that contracts with businesses or government agencies in those towns. The resulting higher costs will sap profit and boost product costs, Hager says.

Likely provisions that would exclude businesses with fewer than 50 or 100 employees from having to offer the higher wages don’t impress Hager. People in his district who rely on giant retailer Wal-Mart shouldn’t have to pay more for groceries or other items because a local government favors a $12 or $15 minimum wage, he says. With citizens in his district earning average wages of about $31,000, it’s not fair to ask them to pay higher prices due to a minimum-wage mandate, he adds.

The minimum wage in North Carolina and neighboring states is $7.25 an hour. The highest rate nationally is $11.50 in the District of Columbia and $10 in California and Massachusetts.

David Mildenberg
David Mildenberg
David Mildenberg is editor of Business North Carolina. Reach him at dmildenberg@businessnc.com.

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