Ag: Oregon wage hike will have big impact
Ag interests say the three-tiered plan to hike the state’s minimum wage passed by the Legislature is better than some alternatives, but still will have a bit impact on growers and processors.
Under the plan awaiting Gov. Kate Brown’s signature, in July Oregon’s minimum wage will jump from $9.25 to $9.75 statewide.
It will gradually climb to $14.75 in 2022 in the Portland urban growth boundary, which includes parts of Multnomah, Washington and Clackamas counties. It will rise to $13.50 in Benton, Clatsop, Columbia, Deschutes, Hood River, Jackson, Josephine, Lane, Lincoln, Linn, Marion, Polk, Tillamook, Wasco and Yamhill counties, and parts of Multnomah, Clackamas and Washington counties outside Portland’s urban growth boundary.
In rural areas, the minimum will increase to $12.50. Those areas include Malheur, Lake, Harney, Wheeler, Sherman, Gilliam, Wallowa, Grant, Jefferson, Baker, Union, Crook, Klamath, Douglas, Coos, Curry, Umatilla and Morrow counties.
Jenny Dresler, state public police director for the Oregon Farm Bureau, said the increased minimum wage will cause some farmers to mechanize while others will probably go out of business because they can’t compete against growers in other states.
“Farmers are price takers. They have no ability to recoup those higher labor costs,” Dresler said.
The three-tiered county wage schedule is a “bizarre choice” since many farms operate across county lines, she said. Growers in some areas will now be less competitive than those in their neighboring counties, Dresler said.
Malheur County onion growers say the plan will have a major impact on local packers.
But the 46 farmers, onion processors and small business owners who traveled 400 miles by charter bus to Salem last month to oppose proposals to raise the state’s minimum wage prevented the outcome from being worse, participants said.
“As bad as it was, it could have been worse,” said Nyssa farmer Paul Skeen, president of the Malheur County Onion Growers Association, which helped finance the trip along with the Malheur County Potato Growers Association.
Bus trip participants told lawmakers that raising the state’s minimum wage would result in agricultural and other businesses moving to neighboring Idaho, which has a $7.25-an-hour minimum wage.
The governor’s original two-tier proposal would have raised the minimum wage to $15.52 in the Portland area and to $13.50 in the rest of the state, so the noise made by the Malheur County crew clearly made a difference in the final outcome, said Rep. Cliff Bentz, R-Ontario, who helped organize the bus trip.
The change to a three-tier system was made as a result “of the loud noise made by the people of Eastern Oregon,” he said. “I think it’s extremely important that people understand they did have an impact.”
The increase in the state’s minimum wage will still have a negative effect on Malheur County’s agricultural industry, which competes against Idaho farmers and processors just across the border, Skeen said.
While Oregon’s final minimum wage plan is somewhat better than the original, “It’s just a slower death,” he said.
Faced with a much higher minimum wage than their competitors a few hundreds yards away in Idaho, onion processors in Malheur County will do one of two things that will result in fewer Oregon jobs, Skeen said: “They will mechanize or move to Idaho or both. They won’t have a choice.”
The bus trip did some good, said MCPGA President Rob Wagstaff. But based on the ultimate outcome, “I feel like (legislators are) telling us they don’t really care a lot about small businesses here. I’m just frustrated they didn’t hear us a little bit better.”
The minimum wage increase will also have a major impact on Oregon fruit growers, said Jean Godfrey, executive director of the Columbia Gorge Fruit Growers Association, which represents 440 cherry, apple and pear growers.
The group’s producers are in an area that will experience the $13.50 minimum wage rate by 2022.
One fruit grower who penciled out the impact of a $13.50 minimum wage on his 150-acre orchard calculated it would cost him an additional $150,000 a year in wages, Godfrey said.
“If you’re in retail, you can pass the increased cost on to consumers,” Godfrey said. “But we can’t do that. We don’t set our prices. It seems to me the people in Salem don’t understand agriculture and the impact (the increase) has on our industry.”