NRF speaks out on Obama's SOTU wage announcement

The National Retail Federation has issued a statement in response to President Obama's State of the Union address, in which he announced that he would sign an executive order to raise the federal minimum wage to $10.10 per hour for workers under new government contracts.

“If you want to create minimum opportunities, then raise the minimum wage," said NRF president and CEO Matthew Shay. "We welcome the president’s focus on the economy and jobs, but a minimum wage hike runs counter to that goal. Raising the minimum wage would place a new burden on employers at a time when national policy should be focused on removing barriers to job creation, not creating new regulations or mandates. It’s simple math – if the cost of hiring goes up, hiring goes down."

“Fewer than 5 percent of hourly workers are paid the minimum wage," he continued. "It’s really a starting wage that allows teen-agers or others with little job experience to enter the workforce. A mandated hike in labor costs would negatively impact businesses that employ people in entry-level jobs and ultimately hurt the people it is intended to help. This isn’t economic theory – when the minimum wage went up in 2009, half a million part-time workers lost their jobs. That’s a risk our economy can’t afford to take."

In addition to the executive order, Obama said that he would urge Congress to approve a universal minimum wage increase to $10.10 per hour over the next three years.