Immediately after the enactment of the 2020 budget bill into law, the Democratic leadership in the Legislature unpacked the minimum wage bill as the next big-ticket item on the lawmakers’ agenda.
The legislation will be up for debate and possibly a vote as soon as the next legislative session.
With Gov. Lou Leon Guerrero signaling in her monthly address Monday that she would sign a minimum wage bill if it reaches her desk, there’s a good chance the Democrats will be able to pull off the minimum wage increase legislation soon.
The proposed wage increase isn’t much for the minimum wage earners who are mostly in the private sector. A 50-cent hourly increase or $40 each payday by March next year will hardly make up for the higher cost of housing, gasoline, power and water costs – but it is better than no mandated increase at all.
The bill proposes to raise Guam’s minimum wage in two phases:
• From $8.25 to $8.75 effective March 2020; and
• From $8.75 to $9.25 effective March 2021.
As in past public discussions on the issue, the minimum wage increase will be opposed by certain employers and businesses. The business organizations have argued that the job market, the island’s economic conditions and individual workers’ job performance should be among the main determining factors in deciding whether a worker should get a pay raise.
While this is the case, it also has been the function of GovGuam to not leave the private-sector workers behind in the struggle to cope with Guam’s undeniably high cost of living.
We think it’s time to revisit the minimum wage, but the discussions should also be paired with a reduction of the gross receipts tax, which has increased 25% in the past year – to prop up GovGuam’s projected cash-flow shortage at the expenses of taxpayers.
In proposing the minimum wage increase, senators must keep in mind that the business community, particularly retail stores, hotels and restaurants, are already struggling in the midst of a changing environment. We’re getting low-spending tourists and our retailers are trying to keep up with online competitors. Our consumer demographic shows many households on Guam have little to no disposable incomes, so when the cost of necessities rises, there’s hardly anything left to take the family to a restaurant, buy clothes for the kids or treat the family to a trip to the mall.
Given these factors, we urge the Legislature to offer employers some form of tax relief while also helping to raise the wages of the lowest-paid of Guam’s workforce.