Minimum Wage Hike Boosts One in Four Leisure and Hospitality Jobs

The paychecks for 6 percent of Idaho’s nonfarm jobs will get a little bigger July 24 when the state and federal minimum wages are increased to $7.25 an hour.

The largest impact will be in the leisure and hospitality industry, where according to Idaho Department of Labor analysts, one of every four jobs – many held by part-time workers – are affected.

Overall, nearly 40,000 of Idaho’s estimated 650,000 jobs currently pay less than $7.25 an hour.

Next week’s increase was authorized by the Legislature in 2007 when it tied Idaho’s minimum wage to the federal minimum wage. That same year, Congress voted to increase the minimum wage from $5.15 an hour to $7.25 an hour in three stages of 70 cents each. The final stage on July 24 raises the wage from $6.55 to $7.25.

The minimum wage for Idaho employees in jobs where they earn tips — bartenders, waiters and waitresses, for example — remains unchanged at $3.35 an hour. But employers must ensure that tips provide another $3.90 an hour to reach the new minimum or employers must make up the difference.

Many of those Idaho jobs in leisure and hospitality involve tips, which in most cases not only meet the minimum wage but exceed it. But according to department analysts, anecdotal evidence suggests tips are declining as the recession wears on, and the higher minimum wage may offer some protection to bartenders, wait staff and others who are watching their incomes decline.

Statewide nearly 4,000 fast food workers, 3,500 waiters and waitresses, 1,000 cooks and 700 bartenders currently earn less than $7.25 an hour. Over 4,400 of those jobs are in southwestern Idaho, the state’s population center, which holds about 44 percent of the state’s nonfarm jobs. Only about 5 percent of all the jobs in southwestern Idaho are paying less than $7.25 an hour now, the lowest percentage of any region.

About 6 percent of the jobs in both northern and north central Idaho will be affected while over 7 percent of the jobs in south central, southeastern and eastern Idaho currently pay less than $7.25. Wages in the northern and north central regions are affected to an extent by the higher minimum wages in Oregon at $8.40 an hour and Washington at $8.55.

The new labor law posters employers are required to display - including the one on minimum wage - are available free of charge from the Idaho Department of Labor and can be downloaded from its Web site at  labor.idaho.gov.