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Local business preparing for minimum wage increase

Shubert’s Ice Cream and Candy has been in Chico for almost eight decades now, and during that time they've had to make many different business decisions. With the state's minimum wage going up two weeks from today, they have to do some number crunching to make sure their business is able to survive.

Posted: Dec 18, 2017 5:53 PM

Chico, Calif.—Shubert’s Ice Cream and Candy has been in Chico for almost eight decades now, and during that time they've had to make many different business decisions.

With the state's minimum wage going up two weeks from today, they have to do some number crunching to make sure their business is able to survive.

When the state's minimum wage increased earlier this year, they didn’t make any changes to their pricing, but owner Casey Reynolds said that won't be the case this year.

"In order for us to stay in business and stay competitive without cutting quality which we absolutely refuse to do, we have to raise the prices to accommodate the new market," Reynolds said.

Beginning January 1st, businesses with 25 employees or less, workers will get their minimum wage bumped to $10.50 an hour. Businesses with 26 or more will have to begin paying their employees $11.00 dollars an hour.

Reynolds says this can be challenging to businesses.

"It's not just the dollar amount hour wage that increases, there's all the extra taxes and fees that go along with it. So if it's a dollar wage increase, then you have your taxes and fees, it's actually costing you about a dollar and thirty cents, and every product that we have coming in, the cost has gone up because their cost of goods has gone up," Reynolds said.

Shubert's currently employees 15 people between their two locations on E 7th and the Chico mall and all employees will see an increase in their paychecks accordingly.

"People that are above minimum wage right now, we will automatically bump them because you can't really bring your minimum wage people that are $10 an hour up to $11 an hour and then somebody's that's been here for three years that might be at $11, $12, $13 an hour, you can't have them making the same money, it all rolls downhill."

Jessica Ellis has worked at Shubert’s for four years and said she's really not all that excited about the increase.

"Eleven dollars is fine with me, you know when I was 18 I think it was seven-something, so eleven seems high to me, but besides that I don't think it needs to go too much higher than that," Ellis said.

Reynolds said her business will do what they need to survive the wage increase, but she worries about the younger workers.

"It actually makes it harder for entry-level people to find jobs. The higher we get and as we get to that $15 an hour, you need to be a skilled employee if you're going to be making $15 an hour, so where are all the high school students, college students that have zero work experience that have never done anything, where are they going to find their first-time job," she said.

This minimum wage will be a yearly increase and as of right now will stop in 2023 when it reaches $15 an hour.

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