Higher wages a surprising success for Seattle restaurant

Menu prices are up 21 percent and you don't have to tip at Ivar's Salmon House on Seattle's Lake Union after the restaurant decided to institute the city's $15-an-hour minimum wage two years ahead of schedule.

For some of the restaurant's lesser-paid workers - including bussers and dishwashers - that's meant as much as 60 percent more. Revenue has soared, supportive customers are leaving additional tips even though they don't need to, and servers and bartenders are on pace to increase their annual pay by thousands, with wages for a few of the best compensated approaching $80,000 a year.

"It's been a surprise," Donegan said. "The customers seem to like it, the employees seem to like it, and it seems to be working, at least in this location."

Higher wages a surprising success for Seattle restaurant

I came across this article from AP, and decided to share it because I'm not quite sure yet what effect a higher minimum wage will have on a large scale. I've seen all kinds of articles of people claiming that a higher minimum wage will cause negative effects. This article claims that this particular restaurant is seeing an increase in service, even though the cost of minimum wage is being passed on to the customer by a 20% increase in prices. The employees are claimed to be happy, that's understandable. It's also being claimed that customers are glad to support this activity as well.

That leaves me wondering if this type of effect is isolated, or can we look forward to seeing more success stories from a minimum wage increase.

That happens when your competition closes their doors and your the only game in town. It will be short lived.

a reply to: EternalSolace

It is isolated but it does illustrate how inflation would kick in with higher prices. So imagine all business in the area raising their prices by 20% or more. So while these employees are earning a higher wage, their cost living also increases so they wind up back where they were before.

originally posted by: mikell
That happens when your competition closes their doors and your the only game in town. It will be short lived.

Any idea how many, if any, restaurants in the area have closed down? Or is that idle speculation?

a reply to: EternalSolace

You know instead of making laws causing massive inflation, why don't businesses just pay their employees a freaking reasonable rate? Oh sorry, the CEO won't get a 14 billion dollar bonus at the end of the year....Only 6 billion....That would suck!

originally posted by: EternalSolace

originally posted by: mikell
That happens when your competition closes their doors and your the only game in town. It will be short lived.

Any idea how many, if any, restaurants in the area have closed down? Or is that idle speculation?

I will take a guess.....WILD SPECULATION....If, off the top of that posters head he/she could name how many restaurants closed down nearby, they have waaaaaaaaaaay too much time on their hands!

I know I wouldn't pay 20% more for my dinner just so my waitress could make more money.

originally posted by: Mawiss
I know I wouldn't pay 20% more for my dinner just so my waitress could make more money.

News flash.....YOU ALREADY DO!!!

What do you think happens when minimum wage increases? Like it has many times in the past, causing YOU to pay more to cover the raises...You're welcome

originally posted by: Edumakated
a reply to: EternalSolace

It is isolated but it does illustrate how inflation would kick in with higher prices. So imagine all business in the area raising their prices by 20% or more. So while these employees are earning a higher wage, their cost living also increases so they wind up back where they were before.

I don't think a 20% increase in product cost would effect people much when they got a 60% increase in pay.

originally posted by: Mawiss
I know I wouldn't pay 20% more for my dinner just so my waitress could make more money.

That doesn't appear to be the case in Seattle because it's claimed that people are actively supporting this restaurant regardless of the increase in price.

originally posted by: Chrisfishenstein

originally posted by: Mawiss
I know I wouldn't pay 20% more for my dinner just so my waitress could make more money.

News flash.....YOU ALREADY DO!!!

What do you think happens when minimum wage increases? Like it has many times in the past, causing YOU to pay more to cover the raises...You're welcome

I was commenting on the OP and you sound weird. Stay away from me.

That's because there's a lot of knowledgeable people that care about their society in Seattle, unlike in conservative areas where people are just cheap and selfish.

originally posted by: CB328
That's because there's a lot of knowledgeable people that care about their society in Seattle, unlike in conservative areas where people are just cheap and selfish.

Amen to that.

It just could be that little thing called "appreciation" which would cause people to patronize a business that shows their "appreciation" for their employees hard work.
This could also translate into better service to the patrons by the employees; thus the tips given for that service.

a reply to: Mawiss

WOW must be nice to have that kind of discretionary income! What if EVERYTHING you buy cost 20% more? Add that up!

Lets play a game! How many places do you frequent each month that have presumably sub $15 per hours workers?

All restaurants, coffee shops, clothing stores, grocery stores, dept stores, and virtually every other business you buy goods or services from.

Now in San Fran where people are already paid above the norm it wont affect as many but what about powdunk, Indiana or Drizzle, Allabama. Pay everyone $15 bucks and hour across the country and the fit will hit the shan!

a reply to: Mawiss

Why don't you want your waitress to make more money?

originally posted by: Chrisfishenstein
a reply to: EternalSolace

You know instead of making laws causing massive inflation, why don't businesses just pay their employees a freaking reasonable rate? Oh sorry, the CEO won't get a 14 billion dollar bonus at the end of the year....Only 6 billion....That would suck!

For one, I clearly said I wasn't quite sure what I thought would happen. That would seem to me that I'm open to either side of the possibilities and arguments. That said, care to tone it down a bit?

How many CEO's would voluntarily take an eight billion cut to pay their workers more? I agree with your point though, if only CEO's would stop being greedy...

Well if this is true and this people are doing great, is fine with me, after all this could keep many workers from having to work and still dependent on the government assistance.

a reply to: sirlancelot

I believe you have replied to the wrong person.

a reply to: sirlancelot

Just happens, I know some folks in Drizzl, Allabama who are making $7.75 / hr. now.
If they could get paid $15 an hour, they would not only be able to afford that 20% increase in the coust of living, they might even be able to start enjoying some of the living they are now denied because of their low wages.
Just figure $7.75/hr for 12 hrs a day at six days a week, compared to maybe $15 / hr, for only 5 adys / wk.

originally posted by: Kali74
a reply to: Mawiss

Why don't you want your waitress to make more money?

They can make all the money their little hearts desire. It will not be coming from my wallet. In fact give the chef a bell and I'll go get my own food. Waitresses and real estate agents are two biggest scam jobs going.