Workers, Employers Adjust To Colorado's Rising Minimum Wage

Jan 1, 2019

The new year brings with it yet another increase to Colorado's minimum wage. As of Jan. 1, the new wage will be $11.10 for non-tipped workers, $8.08 for tipped.

It's the latest rise triggered by Amendment 70, a constitutional amendment passed in 2016. The measure incrementally increases the minimum wage to $12 an hour by 2020.

Chris Edwards, owner of The Johnstown Lunch Box, a small sandwich shop, told KUNC in 2016 he'd have to raise menu prices or shave employee hours to absorb the increase.

"Just because the nature of it," he said at the time. "The restaurant business is a low margin business anyway, so if you have that big of a jump, it would have an impact."

Now, Edwards says his earlier predictions came true.

We checked back in with him at his shop. The price of everything on his menu - from chicken Caesar wraps to Chicago-style hot dogs - has gone up.

The Johnstown Lunch Box.
Credit Matt Bloom / KUNC

"Most of the items, it's like a quarter," he said. "So, it's not too bad."

But with his 13 employees, he was quick to point out that even more price changes are in store.

"Next year, (the minimum wage) will be at $12 an hour," he said. "It sounds great. But the reality is everything is starting to cost a little bit more. And my vendors are charging me more. So, it's kind of relative."

Shop owners in smaller towns are having a tougher time handling the minimum wage increase than bigger cities. Chris Stiffler, an economist at the Colorado Fiscal Institute, said they can't absorb the price increases like Denver can.

"The real question is, and I think you'd have to go to survey data for this, is are you cutting hours?" he said.

"And it does help that we have a good reputation. People are willing to pay a little bit more for it."

Colorado's Department of Labor and Employment collects data on wages and job growth, but not hours worked by minimum wage earners.

Edwards said he hasn't had to cut his employee hours because he's finding ways to keep his regular customers coming back despite rising prices. He started a loyalty program and now sells a free drink card that donates proceeds to the town's high school.

"Those little things can help remind our regulars to help offset the additional cost," he said. "And it does help that we have a good reputation. People are willing to pay a little bit more for it."

Meanwhile, big companies with operations in Colorado - like Amazon and Target - are starting to pay $15 an hour. That puts pressure on other employers that aren't paying that much.

Denver International Airport is asking voters to decide on a minimum wage increase to $15 an hour.
Credit Matt Bloom / KUNC

At Denver International Airport, workers launched a campaign last summer to raise the minimum wage to $15 an hour.

On a recent afternoon, Marie Jacob, a United Airlines catering employee who makes $12 an hour, paced between arriving passengers carrying a stack of brightly colored campaign flyers.

"Some of my coworkers, they have more than 20 people in a household because they can't afford the cost of rent."

"Sorry to bother," she said, handing a flyer to a passenger. "United is unfair."

Jacob said she can't pay her monthly bills with the money she makes at DIA, adding that Amendment 70 is too little too late for workers living in Denver, where the cost of living continues to rise.

"Some of my coworkers, they have more than 20 people in a household because they can't afford the cost of rent," she said.

On top of DIA's potential increase, which heads to Denver voters in their May 2019 municipal election, Denver Mayor Michael Hancock is exploring upping city employee minimum wage to $15 an hour.

The state legislature is also expected to debate giving Colorado cities and counties independent control over their minimum wage when it convenes this month.