OCEAN CITY, Md. - Maryland’s minimum wage is $15 an hour, but business owners on the Lower Shore are already watching a new round of proposals in Annapolis that could raise the statewide pay floor again, including a plan that would eventually push it to $25 an hour.
Mike O’Halloran, the Maryland state director for the National Federation of Independent Business, said many employers are still adjusting to the most recent increase that took effect in 2024.
“Here we are, just a couple of years later, looking at proposals to increase that yet again, putting added pressure on employers,” O’Halloran said.
Opponents of a larger increase argue it would come with significant job losses and slower economic activity. O’Halloran pointed to an NFIB analysis that he said projects 84,000 jobs could be lost statewide, along with $15 billion in economic output if Maryland moves to a $25 minimum wage.
“When we talk about the 84,000 jobs and the $15 billion lost in economic output, it’s not just based on anecdotal surveys,” O’Halloran said. “This is actual data points that we’re using.”
He said the impact would be felt most sharply in hospitality and food service, along with other service-sector employers and some trades. He also emphasized what he called wage compression, where raises at the bottom can pressure businesses to raise pay for more experienced employees, too.
“It wouldn’t just be folks that are making the minimum wage,” O’Halloran said. “All of your veteran employees as well, they’re going to want to see their wages go up.”
In Worcester County, where seasonal staffing is a major part of the local economy, O’Halloran said the effects could be outsized.
“In the Lower Shore, it’s going to have an outsized negative impact because of the industries that make the Lower Shore what it is,” he said, adding that businesses could be forced into “having to do more with less.”
On the employer side, Berlin business owner Chauncey Rhodes said he understands the issue from both perspectives after working minimum wage jobs growing up and later running a surf shop.
“As a business owner, if minimum wage would be that much higher, it would be tough to keep a lot of employees,” Rhodes said. “You might have to downscale it a little bit.”
Rhodes also said higher labor costs can ripple outward.
“If you needed that many employees, I think it would affect everything,” he said. “Cost of goods.”
Supporters of higher wages argue it can help workers keep up with rising costs and reduce turnover.
“For the sake of my paycheck, a higher minimum wage would make the hours I put in much more fulfilling,” said Cole Simms, a college student in Maryland. “With the cost of gas right now, an increase in pay could change every part of my day-to-day life.”
The proposals have not been finalized, and the minimum wage debate is expected to continue through the rest of the legislative session.