NYC's $15 minimum wage hasn't brought the restaurant apocalypse - it's helped them thrive

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  • The $15 pay increase for restaurant workers in New York City represented the largest hike for a big group of low-wage workers since the 1960s, according to a new study.
  • During the years it raised wages from $7.25 to $15, the restaurant industry out-performed the rest of the country in job growth and expansion.
  • The study suggests that increasing pay for restaurant workers - who make up the bulk of low-wage earners - might not harm businesses.
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New York City restaurant workers saw their pay increase by 20% after a $15 minimum-wage hike - and a new report says business is booming despite warnings that the boost would devastate the city's restaurant industry.

During the period NYC raised the minimum wage from $7.25 in 2013 to $15 in 2019, the city's restaurant industry outperformed the rest of the country in job growth and expansion, according to a new study.

The study, authored by researchers from the New School and NYC-based think tank National Employment Law Project, found no negative employment effects after the city increased its minimum wage to $15. NYC restaurant workers saw a 20% to 28% increase in their pay, representing the largest hike for a big group of low-wage workers since the 1960s, Gothamist reported.

Read more: A tweet from Alexandria Ocasio-Cortez convinced me I've been using the wrong word to describe waitresses. Here's why I'll never call them 'unskilled' again.

While the city's restaurant growth is likely due to NYC's overall strong economy, the report's findings might suggest paying workers more won't immediately lead to job loss or other negative business consequences as previously thought.

Business leaders, economists, and pundits long worried that raising employee wages would lead to bad business. Warren Buffett has said a $15-an-hour wage would reduce employment. Congressional economists recently reported the hike would cut over a million jobs. Some individual NYC businesses recently told the Wall Street Journal they have struggled to keep up after the wage increase.

But James Parrott, director of economic and fiscal policies at the New School and co-author of the recent study, told Gothamist that he attributes the "inevitable" fall of restaurants to the industry's competitive nature.

"It's hard to look at the comprehensive data we did and not understand that many, many restaurants have effectively adapted to the rising minimum wage," Parrott said. "Not everyone, but the vast majority."

Across the country, the restaurant industry has the most to lose from a $15 hike. The food-preparation and serving industry employs the most minimum-wage workers at 1.1 million, according to the Bureau of Labor Statistics. Sales, the next industry with the highest low-wage workforce, employs 200,000 such workers.

"New York City's restaurant industry has flourished," the report states. "Most New York City restaurants have effectively adapted to the rise in the minimum wage."

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