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V O L . X X V N O. I JA N UA R Y 7 , 2 0 1 9 22 G RO C E R S A N D F O O D P RO D U C E R S Increase in minimum wage creates uncertainty for grocers B y W i l l i a m H a l l H oliday sales are just one bellwether for Maine's grocery stores and supermarkets going into 2019, according to Christine Cummings. "I'm hopeful that momentum from a strong holiday season will continue into 2019," said the executive director of the Maine Grocers & Food Producers Association, a trade group representing nearly 200 of the state's grocers, supermarkets, food and beverage produc- ers and related vendors. It's too early to know exactly how these busi- nesses fared in the holiday shopping season. And Cummings says changes in state and local laws could affect the industry more seriously than fluc- tuations in seasonal sales. On Jan. 1, Maine's minimum wage increased from $10 an hour to $11, the third increase under a 2016 law enacted by citizens's referendum. e wage will rise to $12 an hour in 2020, and then will be tied to the annual inflation rate beginning in 2021. e trade group originally opposed the referendum, but it is now simply concerned that the schedule of wage hikes is too rapid, according to Cummings. "We're not trying to repeal the vote," she says. "It's just that this is a lot for the business community to swallow, especially in northern Maine." e law is already forcing some supermarkets and producers to curtail business hours and shorten employee shifts, Cummings adds, and the latest hike may aggravate the situation. She also says her group's members are worried about a proposed Portland ordi- nance that would require businesses in the city to grant paid sick leave for all workers. "ere's concern that it's a one-size-fits-all approach," without flexible requirements to accom- modate small businesses, she says. Some members wonder if other communities will follow Portland's example. "[e proposal] is creating hesitation about 2019, even in other parts of the state." In addition, Cummings says the trade associa- tion's members are keeping "a close eye" on local laws that would tax or ban the use of disposable plastic bags in selling food products. For now, 20 municipalities have such laws, and they're being considered by other cities and towns. All these factors are making Maine grocers and food producers uncertain about 2019. "We're not sure how things are going to shake out," Cummings says. "e realities still have to hit home. Check back with us in six months." B O AT B U I L D I N G A diversified outlook for midcoast shipyard B y P e t e r V a n a l l e n F ront Street Shipyard in Belfast has seen unprec- edented growth in the past seven years. e boatyard, which was founded in 2011 by a group that has vast experience in boatbuilding and related products, continues to expand on the waterfront in Belfast, building and maintaining yachts and commer- cial and government vessels. As a company founded after the Great Recession, its president, JB Turner, is not a stranger to economic downturns. "Having worked through several economic up- and-down cycles, I don't believe the dips are always bad for our industry," says Turner. "Often people shift some investment portions of their portfolios into different projects, including real estate and yachts. If the economy takes a projected dip in 2019, we expect some of our customers to invest more in their yachts as they move money out of the stalled stock market." He says he remains positive about the future of the industry and the business. "I see 2019 as a transitional year as the U.S. econ- omy slows down after the recent growth period. In general, if interest rates continue to rise, I expect our smaller production work to slow, but the larger refit projects will remain strong," Turner says. Front Street Shipyard continues to diversify within the marine market. It just completed a 22,500-square- foot climate-controlled building, which provides additional space for new construction. e company also received a grant to install a new 43- by 16-foot waterjet-cutting machine, a precision device that could be used for boat-related products but also non-marine uses. Waterjet cutting machines are used in the automotive, aerospace and defense industries and other manufacturing settings. Front Street also has a partnership with ferry builder Brodrene Aa of Norway, Arcadia Alliance, to construct carbon fiber passenger ferries in North America. "Brodrene Aa has been busy building carbon ferries for European and Asian operators for two decades, and we see an opportunity for growing that business on our side of the Atlantic," Turner says. Maintenance is also expected to be in demand in 2019. "We continue to focus on our core businesses of refit and repair work, which remains in demand," Turner says. "We balance it with boat storage and marina operations, as well as a production boatbuild- ing facility in a nearby town." P H O T O / T E D A X E L RO D, A X E L RO D P H O T O G R A P H Y. C O M P H O T O / C O U R T E S Y O F M G F PA JB Turner Christine Cummings If the economy takes a projected dip in 2019, we expect some of our customers to invest more in their yachts as they move money out of the stalled stock market. — JB Turner Front Street Shipyard F O C U S

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