Impact of Raising the Subminimum Wage on Restaurant Sales and Employment

New research examining the strength of restaurant industries in states without a subminimum wage reveal that abolishing the tipped minimum wage is good for business and workers.

Key findings include:

● Above-average employment growth occurs in the seven states that have already abolished the subminimum wage (Alaska, Montana, Nevada, Minnesota, California, Oregon, and Washington).

● Per capita restaurant sales increase as the tipped minimum wage increases. Growth in tipped restaurant worker employment as a percentage of total state employment tends to be higher in the states that pay tipped workers above $5 per hour, and is higher still in states that have abolished the subminimum wage.

● Eliminating subminimum wage does not decrease employment. In fact, the restaurant industry projects employment growth over the next decade of 10.5% in the seven states without a tipped subminimum wage, compared to 9.1% in states with a subminimum wage.

● Since 2009, tipped restaurant workers have grown in importance as a percentage of total employed workers in $2.13 states, states where tipped worker wages are higher than $5.00, and states without subminimum wage—but growth of tipped restaurant workers as a percentage of total employment is highest in states without subminimum wage.

Find FACT SHEET: The Impact of Raising the Subminimum Wage on Restaurant Sales and Employment below or download here.

Find the press release here.

Find our full report, “Recipe For Success: Raising the Subminimum Wage Strengthens the Restaurant Industry” here.