New York set to boost minimum wage to $15 for city workers

Employers in New York will boost minimum wage for hundreds of thousands of workers on Monday as part of mandated pay hikes embraced by several states in recent years.

Workers in New York City will earn at least $15 per hour at fast-food chains and businesses with at least 11 employees, up from a previous minimum wage standard of $13. Pay will rise to $12 for workers in New York’s Long Island suburbs, while wages for employees in other state locales will rise 70 cents to $11.10 per hour.

For workers struggling in this expensive city, it's a cause for celebration, an extra bit of cash to help with the daily fight to make ends meet, even as rents and other costs continue to rise. For some business owners, it's a burden as they try to figure out how to cope with higher labor costs.

That includes people like Jose Amador, 70, a full-time worker at a Brooklyn grocery store.

As it is now, he has to stretch hard to support his family — he has four kids ages 3 to 15 — on the $2,500 he brings home each month. Almost half is eaten up by rent. The rest barely covers utilities, food and transportation.

In a city where a 30-day subway pass alone costs $121, even an additional $2 an hour "can make a difference," he said in Spanish, speaking through a translator.

"I will be able to have more breathing space," he said, and maybe even save some money for emergencies.

The wage hikes are rolling out as states and public companies face increased scrutiny about their pay practices. Voters in Missouri and Arkansas voted to boost minimum wages during the 2018 midterm elections last November.

Amazon raised minimum pay to $15 per hour for roughly 350,000 employees earlier this year after facing repeated criticism from Sen. Bernie Sanders, I-VT, and other public figures. Other prominent retailers, including Walmart and Target, have also raised pay in recent years.

But for New York-based business owner Sam Lam, it means more worry. This is the sixth time New York's minimum wage has risen since 2013, when it was $7.25.

The owner of two Queens laundromats, he has balanced his budget by cutting back on worker overtime, slashing little perks like company lunches and holiday bonuses, and raising prices.

Since he has fewer than 11 workers at each independent business, his minimum-wage workers will see pay go from $12 to $13.50 in 2019 before hitting the $15 mark in 2020.

"I am in a very stressful situation," said Lam, 54, who also works as a hairdresser.

Workers in New York City's Long Island suburbs will see their minimum pay go from $11 to $12 on New Year's Eve before jumping to $15 in 2021. The rest of the state will see the minimum wage go up 70 cents, to $11.10, with further increases phased in over several years.

If the experience of Seattle, where some companies had to pay $15 per hour starting in 2017, and San Francisco, where it went to $15 for all workers on July 1, is anything to go by, it's neither going to be a magic bullet that puts low-wage workers in a secure position, nor a stake in the heart of businesses, said Jacob Vigdor, a professor at the University of Washington who has been examining the impact of wage increases.

"The general sense is that the fears of what a higher minimum wage might have done to business were exaggerated," he said. "I think it's also fair to say the hopes of what a minimum wage might have done to workers were also exaggerated."

Workers who were already in minimum-wage jobs did see a bump up in their pay, he said. But the rate of new workers entering the low-wage market had gone down, meaning businesses were adapting by doing things like having fewer workers on a shift or adjusting operating hours.

Researchers who studied one group of low-wage workers said they didn't report feeling more economically secure, Vigdor said.

"However much more they were earning, their expenses were going up just as fast, if not faster," he said.

State officials estimated that more than 900,000 people would be earning the $15 an hour wage when fully implemented in New York City.

Samantha Marturana, co-owner of the Buttermilk Bakeshop in Brooklyn, said that when the lowest paid of her workers gets a pay hike to $15, it will have a ripple effect. Employees already getting paid more now because of seniority or special skills will expect a raise.

She and her co-owner could avoid the pay hike for a year by laying off a worker, but they'd rather not, she said. Instead, the business might try to expand product offerings or market more to drive sales.

Flavia Cabral, 56, is planning, too. As a part-time fast-food worker, she's looking forward to buying toys for her grandson, maybe having a little extra to buy the things that were out of range before, like a pair of good quality shoes, or being able to give some money to her daughter for her college expenses.

"Now I have a little release from the thinking, the pressure," the Bronx resident said. "I have hope."

The Associated Press contributed to this report.