In his State of the Union address, President Obama focused on the economy and outlined several plans, including hiking the minimum wage from $7.25 to $9. He said that it would not cost the government a dime. But midstate businesses fear it will cost them a lot.
Murry's, Inc. has been manufacturing frozen foods for nearly six decades. Assembly line employees work hard to earn their money. But if the president's minimum wage increase is passed, Senior Vice President of Murry's, Inc. Tony Lucci said some of the workers will be replaced with machines.
"It is not going to increase employment, it's gonna increase unemployment," said Lucci.
The $1.75 increase may seem like spare change, but when there are hundreds of workers on the assembly line, it adds up. Lucci said that cost will be passed right down the line to the consumer.
"Customers will see the price either go up or the amount they purchase for their dollar go down," said Lucci. "And I do not like the fact that we would have to pass these increases immediately onto the consumer."
Minimum wage increase proposals are something the Lebanon Valley Chamber of Commerce keeps a close eye on.
"If prices do start escalating, that means inflationary pressures, which means less household income," said Larry Bowman, President and CEO of the Lebanon Valley Chamber of Commerce.
Bowman said hundreds of businesses across the Lebanon Valley are in the same boat as Murry's, Inc.
"We are concerned about an increase in minimum wage and where that will be made up elsewhere," said Bowman. "It's not going to mean good things for employers or for the economy as a whole."
"I don't see a pretty situation going forward if this situation happens," said Lucci. "This is gonna be a devastating effect on everyone."
Some midstaters, like Jay Gould of Lebanon, said a minimum wage increase is long overdue.
"I believe in a fair amount of money for a fair day's work," said Gould. "And we're talking about minimum wage. You can't do anything with minimum wage. You can't do anything today."
The minimum wage proposal would steadily increase until it hits $9 in 2015.