Originally published by Daily Camera on October 21, 2024.
In a recent City Council debate about raising the minimum wage, it was remarked that business ownership is itself a privilege. It’s true that there is a privilege in being able to pursue our entrepreneurial dreams, and some of us are fortunate to have more support than others along the way.
But there’s also a real privilege in being part of a small business that values its employees, offering fair pay and making each team member feel like an important part of the success story. As a community, we also benefit from the services these businesses provide and the tax dollars they contribute, which help fund essential public programs.
Casually tossing around assumptions about levels of privilege during a complex policy debate can be needlessly hurtful, while missing a broader perspective. It overlooks how much our local businesses give back to the community and downplays the sacrifices owners make to keep them going. Most small business owners are our neighbors who have invested their hopes and dreams into their businesses, just like we do with our homes. For them, their business is both their biggest investment and greatest liability. When challenges arise, it affects not only the owner but also the employees who rely on it.
Running a small business typically is a livelihood built on personal risk and financial sacrifice. They often operate on razor-thin margins, with owners working long hours, forgoing their own pay and navigating unpredictable financial landscapes. These owners often miss family milestones and work tirelessly, always putting their employees’ paychecks ahead of their own. It’s a common misconception that small business owners have plenty of money saved up. In reality, many live paycheck to paycheck and face the same financial concerns as their employees.
Thus, while the minimum wage increase aims to address the growing disparity between income and the high cost of living in Boulder, the financial strain it places on small businesses cannot be overlooked. Already burdened by rising rents, supply costs and other operational expenses, many small businesses will be forced to make difficult decisions, including cutting hours, reducing staff or potentially closing their doors without adequate support.
Simply put: The idea that small businesses can easily “adjust” to rising costs doesn’t fully capture the personal and financial challenges their dedicated owners tackle every day.
Addressing these dynamics, Boulder Chamber President and CEO John Tayer noted in comments regarding the proposed minimum wage increase that City Council should abide by the “do no harm” principle. “We support measures that will lift those at the bottom end of the pay scale out of poverty. However, the solution cannot dismiss the plight of businesses and nonprofits that will suffer, the jobs that will be cut, the further damage to our tax base and the loss of valuable services.”
The City Council ultimately approved a compromise increase of 8 percent in the minimum wage, pushing back against minority support for a much steeper rise of 15 percent Recognizing the political dynamics and balance of interests at play, your Boulder Chamber offered appreciation for those who supported the lower ramp-up rate but spoke to the necessity of off-setting cuts in business and non-profit expenses. More than 80 percent of Boulder’s business ecosystem consists of small businesses with 19 or fewer employees, making their success essential to our local economy.
As we move forward, Boulder has the opportunity to lead by example, demonstrating how collaboration among city officials and economic vitality organizations, like the Boulder Chamber, can lift our local businesses and their workforce.
Ideas worth exploring include tax credits for businesses that retain employees in the face of pending minimum wage increases. Implementing sponsored employee retention and training programs that focus on upskilling and reskilling opportunities can also boost productivity as a hedge for businesses against rising wages. Going even deeper and engaging in a larger coalition, we can develop specialized business support and mentorship programs that rejuvenate our innovative small business ecosystem.
As we approach the upcoming minimum wage increase, our challenge is to ensure that both workers and businesses can thrive together. While pursuing a dream is a privilege, owning a business brings unique pressures that impact owners, their families, employees and the broader community. By engaging in open conversations with small business owners and exploring innovative support programs, Boulder can continue to be a place where entrepreneurship flourishes, workers are appreciated and the community as a whole prospers. That’s a privilege we all can enjoy.
Joseph Hovancak is vice president of economic vitality for the Boulder Chamber.