Rieger restaurant owner Howard Hanna on paying his staff above minimum wage
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Missouri Influencer Series
It’s been years since Desiree Saunders earned the minimum wage — at that time $2.10 per hour — but the child nutrition worker at Kansas City Public Schools said she constantly sees students whose families struggle because their parents earn Missouri’s minimum wage.
“There’s no way around it,” said Saunders, 56, of Kansas City. “You can’t make enough with minimum wage.”
Many of the students she sees wouldn’t be able to eat if it weren’t for free and reduced lunch, she said.
Missouri’s minimum wage is $7.85 per hour, but an initiative petition on the November ballot would raise it to $12 per hour.
Proponents of the measure — Proposition B — say minimum wage just isn’t livable, but critics worry raising the minimum wage would burden small companies, forcing them to go out of business or cut back on hours. That, they argue, would hurt the very minimum wage workers who hope to benefit from a raise.
Saunders, a steward in the Service Employees International Union Local 1, said she helped collect signatures to get the wage hike on the ballot. She would like to see the minimum as high as $15 per hour, but $12 is a good start.
“But it would also make it so that they would be more accessible to their children,” Saunders said. “They wouldn’t have to work so many jobs.”
As some struggle to make ends meet, The Star’s readers wanted to know: How much does a Missourian need to live comfortably and what would it take to get wages across the state to that level? The Star, in turn, posed the question to its panel of 51 influential Missourians participating in the Missouri Influencers project, which aims to foster a discussion about the biggest issues facing our state.
Massachusetts Institute of Technology calculates the “living wage” needed in various cities to afford basic needs like food, childcare, health insurance and transportation. It’s higher than the poverty-level wage, which the university says doesn’t factor in costs like childcare and health care. Living wage doesn’t include funds for restaurant meals, entertainment, savings or investment.
In Kansas City that “minimum subsistence wage,” as the university calls it, is $11.05 per hour for a single adult. For an adult with one child, the living wage is $24.06. The poverty wage is $7 per hour, just 85 cents less than the state’s minimum wage.
Ken Novak, a criminal justice and criminology professor at the University of Missouri-Kansas City and a Missouri Influencer, said a minimum wage should be a livable wage.
“Nothing is more undignified than working full time yet still being unable to crawl out of poverty,” Novak said. “Whatever the minimum wage is, people should be able to live on those wages.”
Fellow Influencer James Harris, a political consultant, said in the discussion over wages, people don’t separate part-time, entry-level jobs from full-time, career-track positions.
Entry-level positions are meant to prepare a young person for the workforce, or serve as supplemental income for those who cannot find or sustain a family-supporting position,” Harris said. “They are not intended to be a full-time career.”
He added that “government does not create jobs” and can do more harm in attempting to do so.
“An excessively burdensome legal or regulatory environment can stifle job creation by discouraging companies from moving jobs to Missouri. Conversely, state policies that cut red tape and promote investments in infrastructure and workforce training can help attract family-supporting jobs to Missouri,” Harris said.
Making ends meet
Saunders said she can tell some students’ parents struggle to feed the family.
“When they come back to school after a two-week break or a week break, they express how glad they’re back because their mother’s working two or three jobs and she’s still not making ends meet and the cupboards were bare,” Saunders said.
From time to time, students will ask her to wrap up food for them to take home, but she can’t, which she said is heartbreaking. But as a mandated reporter, she gets the information to someone at the district who can help them.
At The Rieger restaurant on Main Street, owner Howard Hanna said he pays his workers well above the minimum wage. To him, that makes good business sense because he can recruit better employees.
“Secondly, once somebody is here and they learn the job, we’re more likely to keep somebody for a longer time. And so much of what we do is constantly training staff, and that’s very expensive,” Hanna said. “If we can keep somebody longer and they can build up some institutional knowledge and really buy into the culture of the place and really become a longer-term part of our team, that’s super beneficial.”
Hanna is part of Missouri Business for a Fair Minimum Wage, a coalition of businesses that support the initiative on the November ballot.
Michael Barrett, Missouri State Public Defender director and an Influencer, echoed Hanna’s thoughts.
“I’m not an economist, and so I won’t pretend to know the precise number, but I know this: lower-class and middle-class wages go right back into the local economy, and so it is actually in the interest of small and mid-sized business to raise wages without a government mandate,” Barrett said. “Plus, you’ll get a more loyal workforce when they only have the one job.”
Thomas Curran, an Influencer and president of Rockhurst University, said the state should be pursuing that living wage threshold.
“In essence, it’s a wage whereby the laborer can afford food, shelter, and the other necessities of life,” Curran said. “This is the threshold for promoting and preserving the human dignity, which all Missourians should expect.”
Drawbacks for businesses
Critics argue a minimum wage increase does more harm than good. Requiring companies to pay more can put them out of business or force them to cut back on hours and jobs, they argue.
David Overfelt, president of the Missouri Retailers Association, said there’s a “huge” difference between a minimum wage and a living wage.
“I don’t think you can legislate people out of poverty through a minimum wage,” Overfelt said. “It’s not going to work.”
Minimum-wage jobs, he argued, give people with limited skills a first job opportunity and training. To get higher wages, people move on to jobs that require higher levels of skill.
“I would say that if a person is that motivated and they’re working two jobs and they’re working hard, I frankly feel that they’re going to be moving up the ladder,” Overfelt said. “They’re going to be moving to the better jobs.”
As for companies, Overfelt said, the money to pay higher wages has to come from somewhere. That could mean cutting back employees’ hours or benefits.
Influencer John Hancock, a consultant and former chairman of the Missouri GOP, said raising the minimum wage would help some while displacing others at companies that can’t absorb the cost.
“Wages should be awarded based on the value of the employee’s contribution to the success of the business and are also a function of supply and demand,” Hancock said. “Valuable employees who are an asset to a business will always receive compensation necessary to ‘live comfortably.’”
Gregg Keller, principal of Atlas Strategy Group and an Influencer, argued when government “tries to force a minimum wage,” the effect is contrary to the goal.
“One needs only look to Washington State, the most recent liberal state to force a $15 minimum wage on employers. What happened in the fast-food industry in that state, as a result of that policy?” Keller said. “Fast-food giants did exactly what they said they’d do and what any responsible business owner would have done in the same situation — they hastened the adoption of automated registers and ended thousands of jobs.”
Jeff Pinkerton, a senior researcher at the Mid-America Regional Council, said the minimum wage has not kept up with inflation. To match the buying power the minimum wage had in the 1960s, it would have to be close to $11 now.
Though raising wages, he acknowledged, can have an impact on businesses’ bottom line, those companies also need customers with money to spend.
“If they don’t have as much money to consume with, that’s going to hurt you on the back end,” Pinkerton said.
While a major study on Seattle’s minimum wage showed workers’ hours were cut, Pinkerton said studies have reached conclusions on minimum wage that run the gambit from positive to negative.
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