Minimum Wage Increases Across U.S. Affects Wide Range Of Workers
ARUN RATH, HOST:
The start of the new year on Thursday means minimum wage workers in 21 states are now earning more money. The Economic Policy Institute, a liberal think tank based in D.C., estimates that over 3 million people will be affected. In many states, it was a modest increase tied to inflation - 13 or 15 cents or so. But minimum wage employees in South Dakota are set to make a whole $1.25 more every hour, thanks to a vote in last November's elections. The new minimum is $8.50. Just off the main drag in Madison, South Dakota, is a Dairy Queen. It's been there for more than 40 years, serving the 7,000 or so people who live here. These days, it's run by a fellow named DeLon Mork.
DELON MORK: I've got about seven full-time people. And I've got 25 part-time kids ranging from minimum wage up to about $16 an hour.
RATH: Mork says the new law adds to his expenses in other ways. To be fair to his non-minimum wage employees at the Dairy Queen, he'll have to raise wages for everyone.
MORK: I can't narrow that gap from the 16-year-old student that is getting their first job that, quite honestly, doesn't know what end of the broom to hold onto to sweep. I can't compress the wages from that person to my experienced college-age night manager. I can't narrow that gap, so everybody moves up.
RATH: He'll have to cut hours, he says, and think about trimming back on community service, like giveaway specials or sponsoring kids sports teams. And, of course, his prices are going up.
MORK: Probably my largest price increase ever. My Blizzards went up 20 cents. $2.99 went to $3.19.
RATH: Those new prices start today.
MORK: I kind of am looking forward to people's reaction when they see the prices are up if they correlate the difference for the prices to the minimum wage increase that they voted on a couple months ago.
RATH: Alaskans also voted to increase their minimum wage last fall. There, it's $7.75, and in February, it'll go up a dollar. Faye Gavin is a banquet server at a hotel in Anchorage. Even though she's experienced, a raise has been tough to come by.
FAYE GAVIN: For many years now, it's been locked for me, personally. And I get about $8.45 - $8.50.
RATH: So she'll get a raise of about 30 cents come February. We asked Faye if she'd be getting an additional raise above that minimum, like DeLon Mork's more experienced employees at the Dairy Queen.
GAVIN: No. I won't get a bigger jump - definitely won't. I'll just get whatever the law states. You know, they're just not generous people (laughter). So, they only kind of go with what they're forced to pay.
RATH: She says it's tough to get full-time hours in the hotel business in Anchorage. Given her part-time hours, this new minimum wage will mean just a few extra dollars a week.
GAVIN: I don't anticipate, other than noticing that I - if I wanted to go to the grocery store, I'd have more money in the account. No. I'm not certainly going to be able to go take a trip on my increase.
RATH: Faye Gavin's income is supplemented with a pension from her late husband. Because of that, her life at the minimum wage isn't a huge struggle. But she says her coworkers have to string together multiple part-time jobs to make ends meet. For them, this wage boost, even if it's just another 10 or 20 bucks a week, is a huge help.
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