The minimum wage increase could impact the small business
RAPID CITY, S.D. (KEVN) - Starting on Jan. 1, 2024, the minimum wage in South Dakota will rise from $10.80 to $11.20, this increase could impact small businesses.
In 2021, small businesses accounted for 25,695 jobs in South Dakota. These businesses look to their communities for support, as profit margins decrease because the minimum wage increases.
“Maybe not everybody recognizes that your small businesses are what’s contributing to building your community. That’s your community feel,” says Somer Kingsbury, the owner of Who’s Toy House.
Due to these changes, businesses in the area are adjusting their budgets, putting the benefits of the employees at the forefront, and cutting costs in other areas.
“With minimum wage increasing, as products have increased, our staff has to be able to afford a higher rent, higher utilities, higher groceries and we recognize that. Unfortunately, I think that as a business owner, you truly need to recognize the fact that you have a budget to balance,” Kingsbury continued.
Despite this, some businesses know that with an increased wage, some perks of the job may be impacted.
“Providing catering for staff meetings, things of that nature. We’re going to have to take that out of the budget to acclimate for raising a wage,” Kingsbury concludes.
The smaller the business, the more likely they are to be affected, making community support all the more important.
“Well, you know it affects everyone’s bottom line you know. It just automatically is going to cost a business more to do business. And you know, you’re not going to get this effect on Amazon or something like that but it’s going to show up downtown. It’s going to show up in every local business,” says Dan Tribby, the General Manager of Prairie Edge.
Business owners say it’s that support that helps keep their doors open.
“That’s kind of the tradeoff. It’s a wonderful thing when the local population supports the local businesses as well,” Tribby concludes.
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