Small business buckle under minimum wage hike
Katherine Wynne is clued out in some respects. Her government believes that small business owners are “fat cats” rolling in money. The fact is that many small business owners scramble every two weeks to meet payroll obligations. For many of us, cash flow is beyond tight. So many small business owners d oscillate close to insolvency as they wait inordinately for large clients including government to pay. Sometimes public sector clients pay in 90 to 120 days after receipt of an invoice. So, small business owners in the service sector end up subsidizing government operations without being paid interest on their receivables. The truth is that small business owners are made up of a wide range of people. So many people end up starting a business to resolve their long-term unemployment crisis. Service sector employers can’t just, or easily pass on increase labour costs to their clients, especially those that use a competitive bidding process such as tenders. I wonder if the government is now going to increase the amounts allocated to their projects to compensate for the increase in minimum wage. Better yet, will the government now pay its service contractors in a timely manner to help meet the business’ wage obligations. The point is that service sector customers have little avenue to absorb increase wage rates. So, all that has happened is that the government has now made tight cash flow situations worse for many small. fledging service-sector employers..