Leaked documents show strong business support for raising the minimum wage

Leaked documents show strong business support for raising the minimum wage

So why do most chambers of commerce still oppose it?


By Lydia DePillis April 4 at 7:36 AM

Whenever minimum wage increases are proposed on the state or federal level, business groups tend to fight them tooth and nail. But actual opposition may not be as united as the groups' rhetoric might make it appear, according to internal research conducted by a leading consultant for state chambers of commerce.

The survey of 1,000 business executives across the country was conducted by LuntzGlobal, the firm run by Republican pollster Frank Luntz, and obtained by a liberal watchdog group called the Center for Media and Democracy. (The slide deck is here, and the full questionnaire is here.)

Among the most interesting findings: 80 percent of respondents said they supported raising their state's minimum wage, while only eight percent opposed it.

"That’s where it’s undeniable that they support the increase,” LuntzGlobal managing director David Merritt told state chamber executives in a webinar describing the results, noting that it squares with other polling they’ve done. “And this is universal. If you’re fighting against a minimum wage increase, you’re fighting an uphill battle, because most Americans, even most Republicans, are okay with raising the minimum wage.”

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A slide from LuntzGlobal's survey of 1,000 business executives. (Center for Media and Democracy)

Merritt then provided some tips on how to defuse that support, such as suggesting other poverty-reduction methods like the Earned Income Tax Credit. “Where you might find some comfort if you are opposing it in your state is, 'how big of a priority is it against other priorities?'” he said.

"Most folks think there are bigger priorities.

Creating more jobs rather than raising the minimum wage is a priority that most everyone agrees with. So when you put it up against other issues, you can find other alternatives and other things to focus on. But in isolation, and you ask about the minimum wage, it's definitely a winner.”

Sixty-three percent of respondents said they belong to a chamber of commerce, whether on the local, state, or federal level — suggesting that the groups' public statements might be out of step with their members' beliefs. The materials shed light on how some business trade associations operate, and why they’ve continued to oppose minimum wage increases even as the rest of the public thaws towards them.

Small businesses react to California wage increase

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Small business owners in California react to the approval of the nation's highest statewide minimum wage of $15 an hour to take effect by 2022. (AP)

The research had been commissioned by the Council of State Chambers, a small, non-political umbrella organization that coordinates messaging across the dozens of groups that make up its membership. The main purpose of the survey, says Council director Joe Crosby, had been to assess what the broader business community thinks about state chambers, and what kind of language they respond to best.

(Under the terms of its contract, Crosby says, LuntzGlobal was forbidden from discussing the survey publicly.)

So why do state chambers, which are usually the largest and most powerful business organizations represented in state capitols, seem so far apart from the broader business community when it comes to the minimum wage?

Crosby argued that modest minimum wage hikes don’t impact the majority of chamber members, and so they actually tend to leave the issue to trade groups for retailers, hotels and restaurants, which employ most low-wage workers.

“In chambers, historically, it’s more successful businesses that are in manufacturing and other higher wage industries,” Crosby says. “They tend to see themselves as the voice of business, but there are other groups that are focused on sectors that are focused on different wage mandates."

In the more liberal areas where minimum wage increases have succeeded, that’s often true:

Broad-based business groups have hesitated to speak out too strongly against the popular measures, leaving those industries that are most affected out in the cold.

"MOST FOLKS THINK THERE ARE BIGGER PRIORITIES. SO WHEN YOU PUT IT UP AGAINST OTHER ISSUES, YOU CAN FIND OTHER ALTERNATIVES AND OTHER THINGS TO FOCUS ON.”
— Republican pollster David Merritt

In some instances, advocates have even targeted low-wage service industries first — a hotel wage ordinance passed in Los Angeles before the across-the-board increase, for example, and New York Gov. Andrew Cuomo raised wages for fast food workers before launching a campaign to do so for all workers (which New York City-based chambers of commerce actually supported).

But in most states, chambers of commerce haven’t been as shy in their opposition to minimum wage hikes. Pennsylvania Chamber of Business and Industry president Gene Barr says he canvasses his members regularly on lots of issues, and they are against raising the state’s minimum wage above where it still sits at the federal floor of $7.25 — even the big, high-tech industries that already pay well above it.

“Our larger businesses get that,” said Barr, who sat through the LuntzGlobal presentation. “We don’t get pushback saying that 'you really need to get behind a minimum wage increase,' because they understand that it’s really not appropriate.”

Minnesota Chamber of Commerce president Doug Loon says his members' opinions don’t match those of the LuntzGlobal survey — including those regarding requirements that businesses offer benefits like paid paternity leave, which 82 percent of respondents supported, or more paid sick leave, which 73 percent supported. The Minnesota Chamber has found that even those of its members who are offering those benefits would rather have the choice of whether to do so, and how.

“It’s what most employers are moving to,” Loon says. “Do we need to pass a one-size-fits-all on sick leave? We would argue that we do not.”

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So Loon and Barr say they’re just following their members’ wishes. Some business groups have a different perspective — but don’t necessarily have the power to combat a state chamber when it puts its mind to something.

The South Carolina Small Business Chamber of Commerce has supported a higher minimum wage, but its president Frank Knapp says his members simply don’t have the bandwidth to push for it, with so many other issues on their plate. “When you actually talk to those people one on one, you find that yeah they’re fine with raising the minimum wage,” Knapp says. “But they’re not going to crusade for the minimum wage.”

That might be true of traditional chamber members too, Knapp thinks, many of whom mostly join for the networking benefits rather than the political advocacy aspect anyway. But within those groups, the industries that care most about a given policy matter — hotels and restaurants, in the case of the minimum wage — drive the organization’s agenda. “Usually the most vocal members of the state chambers dominate on that particular issue, and everybody else stays quiet,” Knapp says.

When that happens, it’s easy for politicians and the public to get the idea that the private sector stands united against raising the minimum wage, when opinions are actually much more diverse.

Holly Sklar is CEO of a national group called Business for a Fair Minimum Wage that favors raising the wage floor in states and nationwide, and she points to a number of surveys by reputable pollsters — from CareerBuilder,Small Business Majority, and the American Sustainable Business Council — that found most businesses agree. Many of those businesses don’t join state chambers, which means their opinions don’t filter up to the organization’s leadership, so its positions don’t change — and that’s what gets conveyed to politicians.

“Sometimes you end up confused by the fact that someone has enough money to be in the halls of the state senate, day after day after day, funded by some of the bigger corporations that have more of an investment in the status quo,” Sklar says. “It has an impact on how it’s perceived — you start thinking that’s what business thinks.”

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