My first job I had was at my Dad’s Ben Franklin store in 1974, for $1.65 an hour. I took this job as an opportunity to grow, learn some responsibility and get my feet wet in the real world while earning some fun money.  I knew that this would not be my lifelong career and for many entering the work force their first job is just that; A minimum wage job taken to earn a little bit of spending money and some responsibility at the same time.

At the time $1.65 was what my dad could afford to pay me, it was a fair wage for someone of my experience and age. If my dad was required to pay me a wage greater than what his business could afford, or that my experience or age could collect, he would not have been able to hire me or afford to stay in business and I would not have learned the valuable life lessons this experience taught me.

The current U.S. national minimum wage is at $7.25 per hour.  Recently, Minneapolis became one of the first cities in the nation to adopt a blanket $15 minimum wage, no matter, age, experience, talent or otherwise. Although not fully phased in until 2024, this increase will affect hundreds of businesses and thousands of workers.  The questions then become, will it greatly benefit the workers, or greatly harm the businesses operating out of Minneapolis?

Cam Winton, Director of Labor Management Policy at the Minnesota Chamber of Commerce shared his concerns, “I hate to say it — because I love Minneapolis and I mean it when I say we all want to see a Minnesota that thrives for everyone — but I fear that businesses will reduce shifts, reduce employment and move to automation [because of the minimum wage increase]” he added,  “We’ve seen this occur in other cities and I fully expect the same to happen right here.”

The Brass team has already seen evidence of the changes that Winton prophesizes; Businesses moving out of Minneapolis to avoid the minimum wage increase and the financial burden it will likely have on their bottom line.  The Brass team has already helped relocate 2 businesses in the last 6 months, secure new space outside of the Minneapolis CBD to a nearby suburban space. The effect of this increase is not limited to one or another specific business sector, one of the clients we relocated was from the industrial manufacturing industry and the other a health services organization.  The decision of both these clients to move was solely motivated by the Minneapolis minimum wage increase, not only because new hires require a $15.00 minimum, but also because current employees making $15/per hour will likely request a wage increase.

I remember a story my dad told me about one of the high school students that worked for him at the Benjamin Franklin, she was tasked with reordering Chapstick for the store but instead of ordering 24 units she ordered 24 dozen units by mistake. Instead of firing or punishing her he said, “We’ll do a feature and see what we can do!”  She created a place for them by the register and made a creative sign and they all sold in 8 weeks’ time. This woman kept in touch with my dad for years, because as she said Bob was the first person in her life that gave her positive input and allowed her to be creative to not only correct a mistake but turn it into a success.  A life lesson learned.

These are the kinds of life lessons that your “first job” provides to people entering the workforce, and while the question of the minimum wage increase in Minneapolis extends beyond kids missing out on this valuable experience and has far reaching and complicated ramifications, the fact remains, this change will change the face of Minneapolis minimum wage jobs in the coming years.

We just can’t see how yet, we are feeling the initial quakes of the change, but what will the ripple effects be long term…?

2 Comments

  • Alan Landreville says:

    The ripple effect for the hospitality industry will be disastrous. When the servers start making $15 an hour plus tips, (which translates to approximately $35 to $45 an hour) the kitchen staff wages will have to be increased. The kitchen employees work in the harshest environment in a restaurant. They work around hot grease, hot equipment, in temperatures that can exceed 100 degrees Fahrenheit in the summer, and getting yelled at by their co-workers regarding where their food is. Meanwhile the servers are working in air conditioned and a much safer environment all the while being observed by the kitchen staff.

    Restaurants will not be able to maintain this added labor expense. Price increases are not going to be able to keep pace with the increase in the wages. Automation replacement means the loss of personal touch provided by people.

    All the states surrounding Minnesota have adjusted wages for tipped employees. Most of the employees that work in the hospitality industry are experiencing their first job and getting an opportunity to be exposed to responsibility. The wage increase will force some restaurants to close which will make these opportunities non existent.

  • mikebrass says:

    Great example, Thanks Dave

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