Restaurateurs say customers pay for wage increase

Higher wages mean higher prices


SAN ANTONIO – The action was nonstop in the kitchen of El Milagrito at Woodlawn and N. St. Mary's during the Wednesday lunch rush.

All of the employees already earn above the federal minimum wage of $7.25 an hour.

"I guess the lowest paid guy in there is a dishwasher and he's making $8.75 already," said Amador Montoya, manager of El Milagrito.

"None of my employees get minimum wage," added William Garza, owner of Guilllermo's Deli on McCullough and St. Mary's. "The employees that do get minimum wage are compensated with tips."

Garza said he uses the minimum wage as a benchmark for wages, often paying even the most menial jobs nearly $2 above that mark.

President Obama's suggestion to raise the minimum wage to $9 an hour by 2015 -- along with annual increases tied to inflation -- wouldn't affect these two businesses initially.

But any increase in minimum wage would affect them and customers.

"If minimum wage goes up, prices will go up in the operations, in the manufacturing plants, in the businesses that depend on minimum wage earners," said Garza.

"For me, the percentage on the margin has been cut by half the last three years, so you've got to look for that money somewhere and the customer is always the one that gets hit at the end," said Montoya.

According to the U.S. Bureau of Labor and Statistics, 8 percent of workers in Texas were at or below minimum wage in 2011, with some of those earning supplemental income through tips.

"We still have a lot of folks who are out there who are being paid the minimum wage, so that would lift the quality of life of a lot of folks in the city of San Antonio," said Mayor Julian Castro.

A total of 19 states currently have minimum wage rates higher than the federal level. Washington state has the highest, having just increased it to $9.19 an hour.