January 22, 2018

New 2018 Minimum Wage Adds Pressure on Kosher Independents

Brooklyn, NY…Many independent kosher supermarkets, particularly in the five boroughs of New York City, are feeling the squeeze with the new state minimum wage requirement that will rise in 2018 to as much as $15.00 per hour for businesses with more than 11 employees. The minimum wage will also be raised in the balance of state. Newly elected New Jersey Governor Phil Murphy wants New Jersey to raise the state's minimum wage from $8.44 an hour to $15 over several years. In interviews with several owners of the independents, Kosher Today has learned that the new minimum wage burden is the latest squeeze on their bottom line. Several mentioned increased competition from new independents and from such newly minted kosher discount stores as Bingo. How this will affect prices is, of course, the key issue. If the past is any indication, the minimum wage hikes will be passed along in some way over a period of time. The challenge will be even greater for stores like KRM (Kollel) and Moshe’s where owner Moshe Binik has held steadfast to his commitment to keep prices from going up. One distributor said: “I can’t see how stores that pride themselves on keeping prices low will be able to absorb such a jump in the minimum wage when they work on tiny margins to begin with.” He added: “For those who think that these large kosher supermarkets are gold mines, they should think again.”