What's up? Minimum wage.
Minimum wage went up on Saturday, July 1, for workers throughout the state, but the amount of the increase differs depending on a company's location within their county.
That's because the Oregon Legislature last year created the first-of-its-kind regional approach to increasing minimum wage: The wages go up a little in rural Oregon; more in some urban and suburban regions; and even more in metropolitan Portland.
Some of Washington County is in the highest zone, called the "Portland Metro" tier. Other parts are in the middle or "Standard" tier.
The split happens along the urban growth boundary, the imaginary line around metropolitan Portland beyond which urban services, and growth, are not allowed. That means wages went up the most in cities like Beaverton, Tigard and Tualatin, but rise less steeply in places like Aloha, Gaston, Farmington and the Stafford Triangle (east of Tualatin, in Clackamas County).
The recent wage hikes work like this: In all of Washington County, minimum wage went from $9.25 per hour on Jan. 1, 2016, to $9.75 per hours on July 1, 2016. That was an increase of 50 cents per hour. It remained at that level through June of this year.
As of July 1, the increases are:
While the change means some workers can expect to see bigger paychecks starting this month, not everyone is happy about it.
"It's a backbreaker," said Gary Nagmay, owner and manager of The Stockpot Broiler in Beaverton. He said the increase will cost his restaurant, with almost 50 employees, an estimated $45,000 per year.
Nagmay said he plans to cut hours, as much as he can.
"That takes care of 50 percent, or maybe 40 percent of it," he said of the increase cost to his company. "The rest is down to price increases."
Ramsey Zawideh owns the Baja Fresh Mexican Grill in Lake Oswego and belongs to the Tualatin Chamber of Commerce. He said he can't predict the impact on his restaurant yet.
"We're initially looking at raising prices, because that's the only way to pay for it," he said.
Zawideh has 24 employees at that site.
"The vast majority of employees are not at minimum wage," he added. "We start them there and then, as they improve themselves, we move them up. I'd say 90 percent aren't at minimum wage."
But a bump up for the lowest-paid employee means increases for the others, he said, to keep things fair.
Impact on region
Oregon's regional minimum wage mechanism is unique in the nation, and may be unique in the world, according to Tom Potiowsky, economics department chairman at Portland State University and former state economist. No other state uses this system.
"Australia does a breakdown by age, but this is different from the geographic approach," he said.
Emily Starbuck, economist and workforce analyst for Washington County, said counties don't keep track of the number of minimum-wage jobs, but the state does. Throughout Oregon, an estimated 300,000 people saw a bump in their pay. That's about one in seven workers statewide, she said.
A large percentage of those people work in retail and food service, she added.
People who oppose increases to the minimum wage often predict a round of layoffs, whenever that number goes up. Others predict inflationary pressure, as prices rise to pay for the increases.
Will the increase lead to layoffs? Potiowsky said it is difficult to predict.
"The minimum wage increases in Oregon in the past have not been as large and impacted a small percentage of the labor force," Potiowsky said. "We are in new territory with the size of impact on the labor force."
Starbuck, the county economist, predicted that the impact of this wage hike should be known pretty soon. Oregon's minimum wage is set to increase again each year between now and 2023, when it will hit $14.75 per hour in the metro region and $13.50 per hour in the rest of Washington County.
Those increases will be smaller than this year's jump — in places like Beaverton, Tigard and Tualatin — of $1.50 over last week, and $2 over 18 months.
"This is the year we'll see the greatest impact," Starbuck said. "So any budget impact (such as layoffs or inflationary pressure), we'll see in this business cycle; maybe in the next school year. I think that will set the trend for the rest of the increases."