Opponents of this trend, notably the restaurant industry, have argued that such measures would be disastrous for restaurants, causing them to raise prices, lose business and slash jobs. Dire warnings that customers would stop tipping entirely persuaded legislators to invalidate a higher tipped minimum wage approved by referendum in Maine.
Are these concerns valid? The very fact that people haven’t stopped going to restaurants or tipping servers in California or Montana suggests that they are overblown. To gain further insight, we looked at the impact on restaurant worker earnings and employment from New York state’s last increase in the tipped minimum wage, from $5 to $7.50 in 2015, using data from the Bureau of Labor Statistics’ Quarterly Census of Employment and Wages, which tracks employment and earnings by industry.
Read the full commentary in the Washington Post.
Michael Paarlberg is an assistant professor of political science at Virginia Commonwealth University, an associate fellow with the Institute for Policy Studies and a postdoctoral fellow at the University of Pennsylvania. He is writing a book on diaspora politics in El Salvador, Mexico and the Dominican Republic. Follow @MPaarlberg
Teófilo Reyes is national research director of Restaurant Opportunities Centers United.