Minimum Wage

Denver's Proposed $15.87 Minimum Wage Hike 'Hurts the People It's Trying To Help'

The restaurant industry would likely suffer under the legislation.

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Denver is mulling new legislation that would increase the minimum wage to $15.87 an hour by 2021, with additional raises every subsequent year.

Introduced by Democratic Mayor Michael Hancock and Councilwoman At-large Robin Kniech, the measure would take effect in January of 2020, when businesses would be required to pay employees at least $13.87 an hour. After the additional $2 raise in 2021, that minimum would increase by 15 percent or $1.75 an hour—whichever is greater—every year after.

The current Colorado minimum wage is $11.10 an hour.

Researchers have long argued over the merits of minimum wage laws: A study from the University of Washington found that Seattle's minimum wage hurt the city's low-skilled workers, while a paper from the University of California, Berkeley says such reservations are unfounded, even in rural areas. It's likely that there's at least some truth to both conclusions: Some people earn more, some people work fewer hours for a higher hourly wage and end up breaking even, and some others might be shut out of the workforce altogether.

Yet one industry that tends to fall on the losing end of such proposals is the restaurant industry, which operates on skeletal profit margins—usually topping 6 percent at max.

Like much of the country, Denver offers a tipped wage, a lower hourly base pay for servers and bartenders that allows them to make up the rest—and more—in tips. But unlike much of the country, the Colorado Constitution stipulates that the tipped wage cannot be less than $3.02 below the state minimum, putting Denver's current tipped base at $8.08. That's already higher than the federal full minimum wage, which sits at $7.25 an hour. (It's worth mentioning that, if tips don't bring workers to the state's minimum wage threshold, their employers are legally required to make up the difference.)

"The speed with which this hike would be implemented is extreme," Sonia Riggs, president and CEO of the Colorado Restaurant Association, tells Reason, noting that restaurants would have a grand total of two months to ready themselves for the first hike. The city council is set to vote on the measure in November. If it passes, she assumes that dining establishments across Denver will first find themselves rushing to raise prices.

"People are not willing [to] pay $25 for a cheeseburger," says Riggs. "Less eating out is bad for everyone in this business."

That won't be the only effect. Riggs explains that, as it stands, servers in the city make somewhere between $20-40 on average, an even greater sum than Denver's proposed minimum wage hike. They'll still see a considerable bump in hourly wages. But kitchen staff, who typically make a marginal rate higher than the state's $15.87 proposal, will receive nothing at all. Back-of-house employees will thus watch front-of-house staff land a sizable raise, even though the latter were already bringing home considerably more cash.

"When the cook making $17 an hour sees the server getting a 50 percent raise to do the same job, the cook is going to want $20 an hour," says Riggs. "But remember, the restaurant has less money to work with here to accommodate that. So again, the restaurant has to raise prices and decrease costs, including cutting staff, in order to survive."

Survival is the name of the game in the restaurant industry, and it's a hard one to win. That becomes even less achievable with large minimum wage hikes: A recent study conducted by two researchers at Harvard Business School found that a median-rated restaurant on Yelp was 14 percent more likely to shutter with every dollar added to the tipped wage. For Denver, those odds would reach 67 percent come January 2021, if the legislation sails through the city council.

Riggs also remarks that restaurants in the area face a labor shortage in kitchen staff. Yet the measure would just further aggravate that problem, hamstringing the restaurateurs who want to hire more help, but who can no longer afford it.

"In the case of the restaurant industry," she says "this proposal actually hurts the people it's trying to help."

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  1. If wait staff can’t make a living wage then those jobs weren’t really their friends in the first place.

    1. If wait staff can’t make a living wage, they either aren’t good at it or need to find a better place to work.

      1. Percentage wise, good servers today can make far more than good servers in past decades.

        I can tip around 20% for good service. Nobody in the 1980s tipped 20%.

      2. Or maybe they aren’t interested in a living wage?

        My daughter really wants to work this summer to earn some extra money, but there is no way she wants to work the hours and levels expected of someone pulling down $15 an hour.

        Yet one more way that our friendly government is slowly infantizing our public.

    2. This is a no brainer.
      Bump the price of food, I’ll move my lunch plans outside city limits.
      I don’t need Denver, frankly Denver has lost much of it’s shine the last 10 years.

    3. If those were the only jobs they could get, then a minimum wage kills any chance they had of building a work history and learning what skills they could to get a better job.

      Minimum wage laws work fine in theory, but that theory presupposes that the government imposing them is sufficiently wise and quick acting to make adjustments as necessary. History shows this assumption to be wildly optimistic.

      The dogmatic proponents of The Free Market are prone to overstate the fairness and reasonableness of the Free Market. Anyone who has ever been involved in collecting ephemera like comic books can tell you this is bushwa. But the unfairness and unreason of the Free Market is seldom if ever such that the imposition of government oversight is likely to improve matters.

    4. This will throw people out of work and onto the welfare rolls, at the mercy of the government. More votes for the Donkeys. Hence their support.

  2. If the state would like to help out restaurant workers all they need to do is allow restaurants to let people get high on-site, maybe even let them sell the devil’s lettuce.

    Revenues go up, everyone makes more money, no need for new laws.

    1. Legalizing whores everywhere would also help.

  3. Who decided that every job needs to keep a family of four out of poverty? This shit really annoys me.

    1. This shows why the Left is a bunch of idiots. They’re all worked up about enabling unskilled and low-skilled workers to earn a “living” wage, but at the same time they hyperventilate if anyone suggests slowing the inflow of unskilled labor from outside the country.

    2. Keith Ellison. Right around the time he co-chaired the DNC

    3. The people that are constantly complaining that shit fucking costs money. It always comes back to those people.

    4. When did it become acceptable for people to have kids before they could afford to pay for them?

      1. With Adam and Eve. Have the sprogs and then scramble to feed them is at LEAST as old as the human species.

        This is why, despite a tendency to preach, I like the nature series that followed Attenborough’s rise to prominence better than what came before; they show that Nature can be, and often is, a stone cold bitch.

        If nothing else, this has at least stopped the ninnies who used to tell me drivel like “Man is the only animal that murders”.

    5. Unions, whose pay contracts are usually tied to a multiple of the minimum wage.

  4. See. $15 per hour is not enough for these Lefties.

    If only reason was not a sell out and we could have weekly articles and discussions about how Lefties are trying to destroy America by undermining free market principles of the market determining wages.

    1. You could try highlighting those stories in your comments.

    2. Poor reason, sends in the Alphabet troll.

  5. Hey if you can’t afford to charge $25 for cheeseburgers, then you don’t belong in business.

  6. Denver’s Proposed $15.87 Minimum Wage Hike ‘Hurts the People it claims It’s Trying To Help’

    FTFY

    1. It’s not about actually helping people, it’s about appearing to help people.

      1. Nonsense. It’s about trying to help people without understanding how anything actually works. Don’t make the mistake of attributing to malice what is adequately explained by stupidity…or ignorance.

    2. Bingo.

      Minimum wage laws are transparently *designed* to expand the class of people permanently unemployed, and hence permanently dependent on the government.

      1. In this way, the minimum wages laws do in fact help the people it’s trying to help. You just have to keep in mind that it’s not trying to help minimum wage workers, just the same as the primary beneficiaries of welfare programs are the well-paid and securely-employed administrators of the welfare programs.

      2. No. Minimum Wage laws are designed by people who do not understand economics and refuse to learn. They get all caught up with how they think things SHOULD work, and never pay any attention to how things DO work, save to massage the data rrom the real world until it fits their preconceptions.

        We see the same thing in the Climate Crusade. They have ‘adjusted’ the data to match their ideas so often and so blatantly that genuine inquiry is stymied.

  7. 15% per year increase after it gets to $15.87? Is that a typo? If not that’s insane.

    1. I sure hope that’s a mistake. In ten years (after 2021), that would make minimum wage $64.20, or over $120,000 a year for a full time burger flipper. Not that any burger flipping jobs would exist by that point.

  8. Its Denver… San Francisco Part II

    1. Fucking Californian idiots ruin paradise, then move to Colorado and vote for the same kinds of people and policies, thus ruining Colorado. Freaking asshats have already turned the housing market to shit, unless you already owned. Sell a cottage in Cali for a million, buy a house in Denver for 300 grand, watch as same house gains in value to 600 grand, and young families are priced out of the housing maret and rent triples for an apartment. I hate these people who are trashing my home.
      Incidentally, did you know that Colorado Springs (where I grew up) was the birthplace of the Libertarian Party?

      1. Round up the progtards and sport them out of this country. Then no more leftist voters.

        1. Trade them to Hong Kong for the protesters there that want freedom and guns.

      2. Let’s be inclusive–it’s actually fucking Californians, Chicagoans, and New Yorkers spreading like locusts.

        1. Need a one child policy for those arses.

          1. Give them a 90th trimester abortion.

      3. They have their sights set on Boise Idaho too

  9. The thing they don’t mention about the Denver labor market is that no one is really working at the minimum wage they’re proposing. Even retail stocking type jobs seem to pay around $16 or so, and tons of them are desperate for people. This means such a minimum wage hike will likely have less of an impact.

    That said, everything is also so expensive (housing, food, etc.) that raising the minimum wage also won’t help anyone as much as they’re claiming it will but it WILL certainly impact particular businesses negatively (such as the example provided in the article).

    Thank god I don’t live in Denver, and more especially Boulder or Golden.

    1. The Front Range was so much nicer when the tards confined themselves to Denver and western Boulder County.

      1. I loved the bumper stickers that read: “Don’t Boulder my Golden!”

  10. Ideas brought to you by those who have never had to meet a payroll or generate a profit.

    1. “generate a profit.”

      They’re never concerned about that. With their social media feeds and friends all talking about socialism they think that is the inevitable future and those that know it currently isn’t realize you have to destroy the system because you can’t use reform to abolish capitalism. That means bad decisions are the right decisions.

      1. But many have “thought” about profit, and decided it is evil, and must be fought against.

  11. Having a legally mandated minimum wage is not bad because it messes with supply and demand and hurts those it’s supposed to help. Of course the economic impact is bad, but it is not enough to destroy a society – and may even artificially stimulate investment into automation.

    No, having a legally mandated minimum wage is a bad idea because it negates one of the most fruitful inventions of Western Civilization – the recognition and protection of private property. Once you loosen that, and decide that a company is not in charge of its own salary scale, and a worker is not in charge of valuing and selling his own labor, the game is over.

    1. Exactly it violates the NAP. What more need be said?

  12. Not quite accurate. The 15% increases are only for the first two years. After that, it will be based loosely on the CPI. Here is my source for this: https://www.westword.com/news/denver-unveils-15-minimum-wage-plan-11487531
    Still way too high, in my estimation. However, it’s not nearly as bad as 15%/year into perpetuity…

    1. Westword is a great local rag. Also, I used to live in, and love, the Westwood neighborhood in west Denver.

      1. Westword’s better than the Denver ComPost, but that’s damning with faint praise. For every decent article they’ve had in the last 15 years, there’s probably 20 on some stupid restaurant that just opened or concert given by some shitty local band. And like a lot of “independent” rags, the moniker is simply code for “always vote for Democrats.”

    2. It’s still fucking stupid because it means a server will have to be paid at least $30 an hour in ten years. Eating out will end up being like the late 19th century in the city, when all the silver millionaires when to their fine dining establishments.

  13. Typical progressive: “As long as you’re trying to help, it doesn’t matter how badly you fuck things up for other people.”

    1. Everyone should support my “Beatings for Progressives” campaign I’m starting. A public plan we can all get behind, and fun for the whole family!

      1. As long as we’re not beating them with those icky plastic sticks but using the much more environmentally-friendly metal rods.

        1. Hey look… the tolerant Right carefully discussing the NAP. Get bent, Brownshirt.

          1. Hey look, you forgot you burned this sock, Shreek.

            1. Really, is the pedophile Shreek so dumb that he doesn’t remember outing himself?

              1. It was dumb enough to post child pr0n links in the first place, so yeah.

    2. Just supply some evidence.

  14. A minimum wage is a sin tax on human labor.

  15. Yeah it is the need of today’s cruel world.

  16. “15% or $1.75, whichever is greater”? That’s a joke, right? A 15% annual increase means doubling every 5 years. So in 2031, the minimum wage would be $60? In 2041, it would be $240?

    1. The best explanation here is that the law says “1.5% or $1.75, whichever is greater” and the reason editors were so ignorant and incompetent that they didn’t even notice how ludicrous their statement was.

  17. The solution to this is very simple. The city leaders take over all the restaurants and pay all employees $20.00 per hour. They can set up at least one new department. Hire family, friends ; great benefits. What could be simpler and better?

    1. Now you’re talking. Why shouldn’t workers control the fruits of their labor instead of some capitalist dick? If I must pay the police department to kick homeless people off the propertay of a capitalist asshole can I at least not hear from said capitalist about how how burdened he is by his tax rate. I think he’s probably got it good, right?

      1. If the laborers are so awesome at controlling the fruits of their labor, why don’t they start a restaurant co-op that pays the wages they think they deserve?

          1. Great! You just demonstrated that no minimum wage laws are needed.

            1. Greatest self-own ever.

              1. Not really, admitting he was a pedophile and posted “KP” is actually.

      2. Oh, that’s cute. You actually think that police remove homeless people from private property. They don’t. Capitalists have to hire their own private security to do that.

  18. A copy/paste from the California rent control article by Greenhut:

    These people are either stupid and incapable of learning that economic laws cannot be repealed by legislative acts or they’re evil and know full well what’s going to happen but go ahead and do it anyway because that’s what the voters demand. Every time I get cynical and decide they must be evil because nobody can possibly be that stupid, I look at Bernie Sanders and all the people who support his Free Shit campaign and realize that, sadly, people really are that damn stupid. I don’t know which is the more depressing thought, that we’re governed by malevolent people or that we’re governed by morons.

    1. Free Shit campaign

      Jerry, you receiving Social Security or in the military. Lots of free shit there.

      1. Actually Shreek, he worked for it.

        Don’t you have some “KP” to get banned for posting?

  19. What kind of shitty person pays a mother of two $7.25/hr for 40 hrs/wk of labor? I’d wager that 90% of these dicks are raving Trump fans.

    1. What kind of shitty person pays a mother of two $7.25/hr for 40 hrs/wk of labor?

      Drunk liberals who fuck around after leaving the bar and don’t tip the server for camping in the booth. Since you don’t pay your mortgage, you should be in expert in liberals not paying their financial obligations.

      1. I stiffed a crooked bank in league with neoliberals in the Bush and Obama administrations— not a bartender. What kind of monster do you think I am?

        1. Why should we take advice from deadbeats?

    2. What kind of irresponsible woman has a kid when she has to live on $7.25/h?

      1. Don’t know— maybe shit happened. That doesn’t excuse shitty employer though.

        1. Letting someone bust a nut isn’t exactly a unconscious decision.

          1. Lololo he actually argued that the other day Ahahahahaha “no one is inviting pregnancy” he said

            “What do you think sex is for dummy” everyone told him.

        2. No, “shit” doesn’t happen when it comes to pregnancy and having a kid. Between abstinence, free contraception, free abortions, and adoption, the only way an American woman is raising a kid on $7.25/h is that she has chosen to do so again and again.

        3. “LeaveTrumpAloneLibertarian
          September.28.2019 at 11:47 am
          “Don’t know— maybe shit happened.”

          Correct; you don’t know. That’s because you’re a fucking lefty ignoramus.

  20. Let Free Market decide prevailing wages.

  21. The irony of this law is that it isn’t going to hurt servers at the stupid little boutique foodie places like in the photo. It’s going to be the cheaper, late-night dives that all the drunk 20-somethings migrate after last call, so they can sit in a booth for four hours and give the server a $2 tip after the leave to stagger back home.

    1. The irony of this law is that it isn’t going to hurt servers at the stupid little boutique foodie places like in the photo.

      Cite needed. Most of these workers stand to make out with a substantial raise because of this law.

      1. Few people ever get paid more because of minimum wage laws; they either lose their jobs or they get replaced by workers worth more the higher wage.

        1. Tools will not replace us.

      2. Cite needed.

          1. BTW, pretty sure that’s not turd; it’s a scumbag with a screen name something like ‘Modern Marxist-Leninist’; yes, there are ignoramuses who are that ignorant of history. The scumbag bragged about bailing on a mortgage after, of course, he bought it hoping it was an “investment”.
            Pretty sure this is the tell:
            LeaveTrumpAloneLibertarian
            September.28.2019 at 10:37 am
            “I stiffed a crooked bank in league with neoliberals in the Bush and Obama administrations— not a bartender…”
            IOWs, he agreed to a contract and then, as a fucking piece of shit, left us to cover the cost of his dishonesty. And brags about it.
            Turd, AFAIK, never bailed on a mortgage; he’s just generally dishonest. If you were in a bar and he walked in, do NOT leave cash on the bar.

      3. “Most of these workers stand to make out with a substantial raise because of this law.”

        The ones who don’t lose their jobs to automation or the owner closing the doors. And those folks can use their new-found income to pay for the higher prices cause by higher labor costs.
        Fucking lefty ignoramus.

  22. “Denver’s Proposed $15.87 Minimum Wage Hike ‘Hurts the People It’s Trying To Help'”

    You’re saying it hurts the politicians who proposed it?

  23. Californian: Man, this state sucks. Everything costs too much. There is too much shit on the ground. We need to leave.

    Friend: Where should we go?

    Californian: I went to Colorado once. It was GREAT. Let’s go there.

    2 years later in Colorado.

    Californian: Yeah, it’s nice here. But…I miss my avocado toast. And I miss having all of these laws that show the rubes how much I fucking care about stuff.

    Friend: We need to vote for people to make this happen.

    Three years later

    Californian: Man, this state sucks. Everything costs too much. There is too much shit on the ground. We need to leave.

    Friend: Why do we have such bad luck where we live. Where should we go to?

    The cycle repeats…

    1. New Yorker (1965): Man it sucks here, let’s go to California.

  24. So all the restaurants implement a strict no tipping policy in order to avoid the income gap from servers and real workers in the kitchen.
    That way the price increase is mitigated for the customers, and the servers get screwed by the politicians and vote them out next time.
    Win-Win.

    (and a free pony for everyone, as long as I am dreaming)

  25. Researchers have long argued over minimum wage laws because people who are ideologically opposed to them can’t pony up the evidence they need, so they keep arguing.

    The minimum wage didn’t destroy the restaurant industry or put waiters in poverty when it was enacted, and the figure adjusted for inflation reaches about $14 in today’s dollars. I doubt it will be the end of Applebee’s.

    Again, such selective optimism and pessimism among you guys.

    You know what’s a real inconvenience was? Ending slavery. How the fuck can you beat free labor when it comes to profit margins?Not to mention the free housing.

    1. Applebee’s is struggling and dozens of Seattle eateries closed. And have you been to McD’s lately….

      You, sir, are an ignoramus.

      1. Are you really worried about restaurants disappearing? I don’t quite understand how so many exist given the profit margins, but there they be. I’ve never driven anywhere without passing at least one. Maybe Applebee’s is suffering because they offer middling fare at either higher prices or slightly lower prices than local, good restaurants. And the McD down the street from me seems to be doing OK. I can’t even go there during any traditional meal time because it’s too busy.

    2. “Researchers have long argued over minimum wage laws because people who are ideologically opposed to them can’t pony up the evidence they need, so they keep arguing.”

      No, honest ones have not. Fuck off, slaver.

  26. I’m not sure the headline is accurate, though. Does the law really hurt posturing politicians, or labor unions trying to freeze out non-member workers?

  27. sarc> So glad that I got a Master’s Degree in chemistry and have stayed with one job for my whole career in spite of ups and downs </sarc

    I make almost as much as some waiter in CO….

    Something is really wrong with this picture, and I don’t think it’s me this time.

  28. “Yet one industry that tends to fall on the losing end of such proposals is the restaurant industry, which operates on skeletal profit margins—usually topping 6 percent at max.”

    Gonna one up you on this one; the grocery industry. Margins are 1-2% at most. Minimum wage laws are garbage. I was able to get a lot of work experience quickly precisely because I started at $7.25 and was only making $9.25 after 2 years. But I didn’t care about that; I got 2 years of management experience as a front-end manager and CSR and that was worth a hell of a lot more than anything else. With a minimum wage of $15, people like me wouldn’t even have those job opportunities.

  29. First Seattle.
    Then LA.
    Now Denver.
    I would like to propose a law that any politician who votes to force the minimum wage higher should compensate any business that goes bankrupt or any person who was forced into unemployment by their voting for the raising of the minimum wage to force said politician(s) to reimburse the business owners and unemployed people out of said politician’s own pocket.
    That would stop a lot of this bullshit regarding raising the minimum wage.

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