Salem’s New Payroll Tax Hits Our Most Vulnerable Employees

While we all want to live in a safer Salem, the City Council’s plan of a city-wide payroll tax is not the way to get there. The theory is that increasing the budgets of various public services will translate to more effective firefighting, better police enforcement of laws and codes, improved ambulance response times, and a better approach to our expanding homeless populations.

In a time and economy where the dollar is stretched thin, our elected representatives must re-evaluate the tax dollars they already collect. Employers are expected to do this to ensure their business’ vitality. Heads of households must do this to secure their families’ well-being. We should expect the same level of scrutiny from those we’ve elected to represent us.

And it’s more than just dollars. We are facing an alarming workforce shortage. The number of retirees is growing much faster than that of new workers, and this is expected to rise. The employment tax will likely hasten this shortage. Meanwhile, many current employees already struggle to make ends meet. The costs of goods and services have increased due to record inflation. According to the Board of Governors of the Federal Reserve System, there has been a 20% increase in credit card utilization over the past year. The data also show that delinquent payments are on the rise.

This tax creates a disadvantage for Salem business owners already struggling to find capable and motivated employees. With an added payroll tax, meeting basic needs would be more possible when working for a company located outside Salem. Without a sufficient number of employees, businesses either run at diminished capacity, close their doors, or move to a more favorable location.

The medical field has seen a decline in those willing to work the long hours necessary to meet patients’ needs. Under unrelated economic strains, primary care practices find it difficult to pay competitive wages. Multi-physician and specialty clinics requiring large numbers of employees struggle to stay adequately staffed. These factors result in practices being consistently understaffed and unable to work at full capacity. The result is a relative lack of availability to care for patients. The demand to provide healthcare is only expected to increase as the population grows and ages, additionally we are seeing a primary care & overall physician shortage. Healthcare employees are pushed to work harder, faster, and longer hours and patients are increasingly frustrated with a medical system that is harder to access. On July 1, 2024, we’re planning to lower the wages of those medical employees working in Salem, regardless of where they live, compounding an already stressed local medical system.

I appreciate that the City Council wants to make a “Safe Salem”, and I wholly support police, fire, and emergency services. However, the taxing proposal passed by a 5-4 vote. This is not a strong endorsement that our councilors believe this is the correct path forward, and comments from the public show there is almost no support from the citizens of Salem. Wouldn’t this be a better time to lead by example and put in long hours to fully explore the current state of law enforcement, policy enforcement, and homeless enforcement? The responsible course of action would be to critically evaluate our spending and pursue a more disciplined strategy. This is exactly what would be expected of any individual who found themselves in financial peril. Why is it we don’t expect it from our government?
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Dr. Vincent Koletar is a Salem-based pediatrician.