Mimimum wage ekes upward
WARREN – The new year may bring many things, but one change in particular – a dime for some, a nickel for others – is in store for many.
Today, Ohio’s minimum hourly wage will increase from $7.85 to $7.95 for non-tipped employees and from $3.93 to $3.98 for tipped employees. The increase will affect 330,000 Ohio workers, according to Policy Matters Ohio.
Josh Nativio of Warren called the increase “laughable.”
Nativio, who works at All American Comics and Cards in Warren, is among those who will not be affected. But he knows some who will.
“They need and they spend every dime that they get. The increase itself is laughable, but any minimum wage increase to workers is a good thing,” he said.
The federal minimum wage is $7.25, but Ohio voters passed a constitutional amendment in November 2006. The Ohio Fair Minimum Wage Amendment mandates that state’s minimum wage increase Jan. 1 of each year to match the rate of inflation.
The state minimum wage is tied to the Consumer Price Index (CPI) for urban wage earners and clerical workers for the 12-month period prior to September. This CPI index rose 1.7 percent from Sept. 1, 2012, to Aug. 31, 2013.
For a nontipped employee who works 40 hours a week, the raise means pay of $318 a week instead of $314 a week – $208 more this year for somebody who works 40 hours a week for 52 weeks.
Some say the slight increase, although welcome, isn’t nearly enough.
“I think it could have been a lot better than that. People can’t live on $10 an hour, let alone that,” said Marylou Killeen, head cashier at the Sunrise Inn in Warren. Killeen is an untipped worker who makes more than the new state minimum wage.
Server Rachel Tallman, who will see a 5 cent increase as a tipped worker, said the raise won’t help.
“It’s just going to make everything else go up. It usually does. They’re just going to take more taxes,” she said.
Tallman, who works part time, said she would rather see the increase from patrons.
“I’d rather see people actually tip. My last table left without tipping me. I don’t think that people are educated about it,” she said.
Tipped employees are those who regularly receive more than $30 a month in tips. Employers must be able to prove that tipped employees receive at least the minimum wage when wages and tips are combined.
The raise will also affect some small business owners.
Nick Liakaris, an owner of the Mocha House in Warren, pays close to 50 employees.
“I think the minimum wage going up won’t directly affect us too greatly … although right now with the way the economy is, we don’t think the timing is good, but it shouldn’t harm us too too bad,” he said.
Liakaris said the requirement should be tiered for adults versus young adults, such as high-schoolers. He also said the higher wage payout won’t force him to raise his prices.
“As a business we try to absorb as much as we can. Eventually I think as all businesses, it gets passed on to the consumer. We try to hold off as long as we can because we are very sensitive to our customers and we don’t like to increase unless we absolutely have to. Eventually they do catch up and, as any business would, we do have to adjust (prices) accordingly,” he said. “We’ll have to sit down and evaluate everything, but as of now, we don’t have any plans on having any price increases.”
Nativio said the increase in minimum wage will help, not harm, area businesses.
“Unlike workers at the top levels of our society, minimum wage workers immediately put their money back into the economy by spending it. They’re not investing in building portfolios and squirreling the money away for a rainy day; they’re spending it immediately at the retail service industry level, which pumps it right back into the economy,” he said.
Amy Hanauer, executive director of Policy Matters Ohio, said, “Ohio workers and the Ohio economy will both benefit from this raise for our lowest-paid neighbors. The employees who benefit will turn around and spend money in our communities, stimulating growth here.”
Greg Bartholomew, owner of All American Cards and Comics in Warren and Boardman, said small business owners should be able to manage the increase without issue.
“As a small business owner, I wouldn’t have a problem with a 10 cent-an-hour raise,” he said.
Bartholomew, who has been a business owner for 20 years, has less than 10 employees, all of whom already are paid more than the state minimum, he said.
“It’s so small. I’m not an economist, but I think it’s small enough. Every little bit helps for the person in charge,” he said, adding that even if you had 20 employees and paid out a thousand hours in pay, you’re only looking at another $100 dollars.
“I don’t think that that should be any problem for anybody. You have to take into account inflation and things like that,” he said.
Nativio said in his opinion, minimum wage should be around $15 an hour.
“How long are people going to stand for the government subsidizing low level service industry people?” he said.
The Associated Press contributed to this report.