In 2006, a state constitutional amendment passed that established a formula to adjust the minimum wage in Ohio to keep up with the state consumer price index.
Ohio is one of eight states and cities with such laws.
Steve Anzur, director of the local Small Business Development Center, said most small businesses will not be affected — businesses that make less than $283,000 a year may follow federal minimum wage guidelines — but businesses in retail and food service would be the most affected.
Some restaurant chains, such as Lee’s Famous Recipe Chicken, add minimum wage increases to a long list of troubles in a down economy.
“Like all of us in the restaurant business we’ve already had to do more with less with rising food and utilities and gas costs, and the minimum wage is just another thing that we have to deal with,” said Scott Griffith, president and general manager of Springfield area Lee’s restaurants.
“We’ll have to pass some of that on to customers, which is the hardest part,” he said.
Griffith said he does not know if area Lee’s restaurants will increase prices until they see the effect of the wage increase later next year.
Other restaurants may already be paying their employees above the current minimum wage.
“Often times what happens is there are certain businesses that start the new hire at minimum wage and after 30 days or 90 days their hourly rate is adjusted up based on their performance,” Anzur said.
Linda McGee, a co-owner of two Springfield Subway sandwich shops, said her stores only pay minimum wage the first 30 days before instituting pay increases for employees.
Popeyes Louisiana Kitchen, which opens on South Limestone Street this month, just hired at least 60 local people, all of whom start at minimum wage and will see their paychecks increase with the new wage at the first of the year, said Andre Moore, Popeyes regional manager.
“It wouldn’t be anything different,” Moore said. He said workers can see their wages increase up to three times in a year. “I think (the wage increase) is long overdue.”
Despite the positive outlook from local restaurant chains, Michael Saltsman, a research fellow with the pro-business Employment Policies Institute in Washington, said such laws have created problems.
“The original point was to raise wages gradually and help reduce unemployment. Instead, they’ve had unintended consequences,” Saltsman said.
Some cash-strapped businesses have hired fewer people and given employees fewer hours in lieu of raising prices, Saltsman said, noting that higher wages may have kept as many as 114,000 jobs out of reach for 16- to 19-year-olds nationwide.
Jim Brock, professor of economics at Miami University, noted the minimum wage law has been a “double-edged sword.”
“Right now, the timing is not great,” he said. “Right now, we have a fairly slowly recovering economy, and people’s outlooks are uncertain.”
A stronger economic recovery would make the minimum wage increase less of an issue, he said.
But for workers, any increase is good.
Marcina Lee, who works the drive-through at Lee’s, 410 W. Columbia St., said she began working at Lee’s in April and has had her wages increased so she no longer makes minimum wage. “If I was still making minimum wage, I would be very excited,” she said. “Every little bit helps.”
Contact this reporter at (937) 328-0371 or emason@coxohio.com.
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