By: Jade R. Gardener
All Emily Siegel has left to remember the Larchmont of her childhood are memories and photos. Today remnants of stores such as Toy and Sports, Wendy Gee’s and almost a dozen more community staples are now ghosts. Since the financial crisis the number of small businesses in Larchmont, NY has decreased drastically. Very few new businesses have taken their place, leaving many empty storefronts. “Stores that we would go to for most our lives are just gone. Every time a business closes it steals the spirit of the town,” said Siegel.
The town of Larchmont, once celebrated as the 11th best place to live in the country heavily because of its plethora of small businesses, is town is now struggling to keep these small businesses alive. Since 2009, Larchmont has seen a 40% decline in small businesses.
The death of Larchmont’s small businesses is due to a number of factors and the impending minimum wage increase is anticipated to lead to the increased decline of businesses on the already edge of collapse. The loss of small businesses is not just a worry for Larchmont but all small businesses in the suburbs of New York City.
The population of the suburbs that surround the New York City is roughly 1.5 million residents. Each town is dealing with the impending increase in different ways. For many retailers, the rising minimum wage is an added burden to their already overflowing list of economic strains. Over the next six years, minimum wage workers in New York state prepare to see an increase in their income. For the lowest waged workers, this is a victory. For small business owners especially in the suburbs on the outskirts of New York state, it is a loss.
“In these small towns, we are fighting a number of issues. There are exorbitant rents for small businesses and the internet is making the need for a retail store unnecessary,” said Bob Marrone member of the Larchmont Chamber of Commerce.
In most recent times Larchmont has seen the closing of retailer Wendy Gees after 24 years in business. This loss has many patrons of the store worried about what is next. Siegel worries what the increase will do to other businesses.
“I see large and small retailers struggling,” she said. “Many of them are closing earlier and there is less staff. If they all have to pay more for minimum wage employees, I am afraid to see what town looks like by 2021.”
Although the suburbs played no part in the Governor’s approval of the minimum wage they have to carry it out. As seen in chart New York City Minimum Wage Suburbs vs. The City, the city and the suburbs will both get to the minimum wage of $15 an hour by 2021, but the suburbs will move at a slower and less gradual pace.
While the city minimum wage will increase by two dollars every year until reaching fifteen in 2018 the suburbs have decided on a more steady one-dollar a year increase. The issue here is while those in the boroughs will start making fifteen dollars by 2018 those in the towns and villages on the outskirts of the city must wait until 2021. Residents such as Siegel hope that the slower increase allows small businesses to get their footing and map how to afford the increase.
Workers in the suburbs say they need the increases terribly. As many complain minimum wage workers in the city are not subject to the expenses required for working in the suburbs. Small businesses such as the Cherry Tree Frozen Yogurt shop in Mamaroneck, NY already pay some of their employees above the present minimum wage.
Jessica Mendoza who started Cherry Tree Frozen Yogurt three years ago start making about $8.75 and hour and now makes already makes $12 (although the increase to $12 for suburbians will be in 2019). Mendoza sees the higher present wage as a positive, “You have to drive everywhere here so living here is more expensive. Now that I am making more I have more for books and to save.”
Some workers, however, hope that the increase actually leads to increased wages for those making above the minimum wage. Some workers, however, believe that the increase in the minimum wage will lead to a boost for those already making more than minimum wage.
“If those making minimum wage get an increase then that means if you are making more than the minimum wage already you should see an increase too,” said Elena Espinal of the Fair Deal Cafe in Yonkers, NY.
Even though the minimum wage seems promising to workers it is a potential nightmare for business owners, who are dreading the increase in their costs.
In Mount Vernon, NY small businesses owners are dreading the increase as well. “I try to keep my prices low for the consumer. If I have to pay my workers more, I can’t give raises,” said Meisha Jones owner of Cupcake Cutie Boutique.
Although workers are optimistic the truth is owners are faced with a dilemma, pay wages or close. “ I have talked to some small business owners that are weighing their options. Some will raise costs. Others will fire workers or cut hours, some will pay off the books and other will close,” said Jones.
Politicians, on the other hand, say the increase in wages will help small shops by increasing spending. Officials, however, hope that the increases in wages will lead to an increase in spending from consumers.
The increase is a positive one says, Mount Vernon city council president, Marcus Griffith.
“We want to see more small businesses growing in the community and if people make more, the hope is that they will spend more too, thus allowing businesses to cover the increase”, said Griffith.
The problem, however, will occur if a business can not cover the increase. Small businesses are risky and time-consuming. The budgets and salaries are directly dependent on consumer spending. With consumer spending still not back to their pre-recession levels the increased the minimum wage is an added strain that threatens the success small businesses throughout the suburbs of New York.