NEWPORT, Vt. -- Mike Marcotte and his wife have owned and operated the Jimmy Kwik convenience store since 1983, and they will tell you it has not been an easy three decades. This is especially true during the last 10 years, when a combination of high unemployment and tough competition have had the store scrambling for the business of customers with financial pressures of their own.
"When you look at area as a whole … there are five c-stores on a mile and a half stretch, so it's highly competitive, and a lot of them are chains, which makes it difficult, harder for the mom-and-pops such as myself to compete," Marcotte told CSP Daily News.
Add to this a recent increase in the state minimum wage, which would step up from $8.73 to $9.15 in January 2015 and then every year from there until it hits $10.50 in 2018. Beginning in 2019, the minimum wage will get raised 5% annually or meet the increase in the Consumer Price Index (CPI), whichever is smaller. This will give Vermont among the highest minimum wages in the country.
But Marcotte, who has five part-time and two full-time employees—he and his wife—was in the unique position of getting to vote on Vermont's minimum-wage increase. That's because he has served in the Vermont state citizen legislature for the past decade. And as vice chair of the commerce and economic development committee, he has had a front-row seat to discussions and testimony on everything from the minimum wage to mandatory paid sick days. This has helped him appreciate the full range of views.
"I learned early on when I first went down there that things aren't cut and dried just because of my experience as a retailer," he said. "There are other factors going on."
Marcotte voted yes on increasing the minimum wage, supporting the stepped approach because it helps small businesses such as his own to plan ahead. At the same time, he opposes the idea of tying it to cost of living increases or inflation, because it makes the size of the increase unpredictable and tough to absorb for small operators.
"Anything that continues to increase your costs comes off the bottom line for what you're able to take home and survive on," he said. "We had businesses in the state that are supporting what they call a 'liveable wage' in Vermont, and those business' profit margins are generally much higher than what our profit margins are in the c-store and grocery business. Anything we do to increase those costs makes it really difficult for us."
He also does not believe an increase in the minimum wage will make the state more competitive, noting that Vermont has an aging workforce and is largely rural, with younger workers leaving for high-paying jobs elsewhere in the region.
While some have suggested that raising the minimum wage can help address income inequality, Marcotte believes the answer really lies in education.
"What we need to do is have better training programs to train people, educate them, so they can get the good paying jobs," he said, suggesting a greater emphasis on math and science in school. "Jobs like mine are more suited to high-school kids, college students, to help them raise money to go to school. We're finding more people are taking those jobs because they have to. They don't have the training to get better-paying jobs."
It's tough for Marcotte to juggle his business and legislative career. He dedicates January through mid-May to the state legislature in Montpelier while his wife oversees Jimmy Kwik. Then he returns home to head up the c-store in the summer and fall. That being said, it's an experience he recommends to other c-store operators.
"I would hope retailers would think about serving their local community in the capacity of select boards or city councils, or in their legislature," to share the small-business perspective.
As for him, Marcotte is going to try to balance both worlds despite the increasing costs of doing business. He has already cut hours for employees at Jimmy Kwik's redemption center, but knows he has to straddle a line.
"We're going to look at raising our prices, but we're going to have to see what other stores are going to do in the area so we can stay competitive," he said. "Where we can, prices are going to go up. If it gets to the point that too many mandates are put on us as a small business, I'll probably come back home."
For more on how c-store retailers are reacting to the minimum wage debate, click here to viewCSP magazine's October cover story, "Wage Rage"
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