At Granny Shaffer’s restaurant in Joplin, Missouri, owner Mike Wiggins is reprinting menus. Soon the two-egg breakfast will cost $7.39, an extra dime. His three-piece fried chicken dinner will go up 20 cents to $8.78. Why the change? A new minimum wage law means Wiggins must pay out $10,000-$12,000 more to his staff. Money for higher salaries must come from somewhere since, he says, “There’s no big pot of money . . . to get the money out of.”
The Bible tells employers, “The laborer deserves his wages.” (1 Timothy 5:18) Scripture expects that workers should be treated “justly and fairly.” (Colossians 4:1) But working out the details can be tricky—especially when the government and human greed are involved.
In January, 20 states and nearly two dozen cities rolled out new minimum wage requirements. Alaska saw an extra nickel per hour. But Maine, Massachusetts, and some California businesses took on a dollar-an-hour wage hike.
Many New York City employers must pay at least $15 per hour. That’s more than twice the hourly federal minimum of $7.25. The largest employers in Seattle, Washington, must pay workers at least $16 an hour.
In fact, Seattle has led the push for higher minimum wages. Back in 2015, a city ordinance raised the hourly minimum wage to as much as $11 and then to $13 in 2016. (The amount depends on the size of the employer and whether it provides health insurance.)
Last May, researchers found that the increase to $11 didn’t affect employment much. However, the hike to $13 an hour resulted in “a large drop in employment.” In some cases, employee paychecks were lower. The higher minimum wage caused employers to assign fewer work hours.
But those same researchers reached a different conclusion five months later. They said Seattle workers employed at low wages worked slightly less after the minimum wage increase but got paid an average of $10 per week more (before taxes).
As in Seattle, economic study results on minimum wage increases are mixed: Some folks benefit; others suffer.
Meanwhile, Granny Shaffer’s waitress Shawna Green will see her base pay go up. But she sees two sides to the change.
“We’ll have regulars, and they will notice, and they will bring it to our attention, like it’s our fault” that prices are increasing, she says. “They’ll back off on something, and it’s usually their tips, or they don’t come as often.”