St. Lawrence County businessman: Minimum wage a factor in closing multiple eateries
OGDENSBURG — North country entrepreneur Marc C. Morley says the rising cost of doing businesses in New York state has forced him out of business.
Mr. Morley, the owner of multiple restaurants in St. Lawrence County, has closed Between the Buns and Club 21 in Potsdam and closed his Hot Tamale and Chix n Pies eateries in both Ogdensburg and Massena.
His two remaining Hot Tamale restaurants in Canton and Potsdam remain open, but are up for sale.
Approximately 60 people have lost their jobs as a result of the closures, according to the owner.
Mr. Morley said his decision to close up shop after 10 years in business is related directly to the growing cost of doing business in New York state and he points to the new minimum wage rate of $11.10 per hour as an example. The state’s minimum wage rate for north country workers increases to that level on Jan. 1, a 70-cent hike from the current $10.40 an hour. The increase for each full-time minimum wage worker is $1,456, for a total annual pay of $23,088.
Workers in New York City will see their rate climb to $15 an hour, part of a multiple-year push by Gov. Andrew Cuomo to raise basic earnings across the state.
But Mr. Morley said that increase, on top of the other expenses of running a for-profit business, are just too much.
“A lot of it is the minimum wage and New York state in general,” Mr. Morley said. “It gets more and more expensive every year in New York state as far as workers comp, disability, you know, all of these insurances that we have high rates for. And in New York, once you get up to 70 or 80 employees, those numbers get pretty big.”
Since opening his first restaurant approximately 10 years ago, Mr. Morley said he has needed to raise prices every year to stay abreast with increasing costs, particularly labor.
“The majority of our people are minimum wage and so every year we eat that cost and in the food service business people don’t want to spend more than 11 or 12 bucks for lunch,” he said. “Eventually you get in that crunch where you wonder how much can you charge and still be profitable.”
As a business owner, and someone who also dines out, Mr. Morley said he can no longer afford to continue passing on his growing operating costs to customers.
“The wage is going up even more in the next year or two, so the labor costs are getting really hard,” he said, “It’s no longer cheap to eat at Hot Tamale. Even me, as a consumer, I wonder how much will I pay for lunch? How much do I want to shell out? Do I want to shell out $15 just to go out to lunch?”
The local businessman said when he opened his first Mexican eatery, the price of a burrito was about $5. Now, he said, the price is more than $9.
“We used to have a lot more business when people could grab a burrito and go, for five or six bucks. With a drink and everything else it was seven or eight. Now, it’s $12 or $13,” he said.
Deciding to close his businesses has been a tough but necessary decision, according to Mr. Morley.
“It’s been a long and tough road for us,” he said. “We had a very aggressive expansion plan. Sometimes you just take risks and as a business owner you take all of the risks and in the end you are the one that has to deal with it.”
He added, “Over the years we’ve been in business we’ve employed thousands of people and helped them raise families. It’s unfortunate it has come down to this. The Hot Tamales are for sale and Between the Buns is for sale. So in the end all of the financial things will be cleared up.”