Why Ohio’s Minimal Wage Elevate Will not Have an effect on Most Companies

COLUMBUS, Ohio (WCMH) – As the New Year rolled around Sunday morning, a fraction of Ohioans saw an automatic increase in soon-to-be-owed wages as the legal hourly minimum rose from $9.30 to $10.10 for untipped workers and from $4 .65 to $5.05 for tipped workers.

Ohio’s minimum hourly wage has been indexed to inflation since November 2006, when voters ratified a constitutional amendment mandating that it should increase annually with inflation. The legal minimum is scheduled to be adjusted on January 1 of each year, according to the Ohio Department of Commerce — this year for companies with annual gross sales of $372,000 or more.

In 2023, workers without tips will be $0.80 up from the prior year — the biggest change on record, according to policy research organization Policy Matters Ohio.

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“While these new salary scales won’t increase workers’ purchasing power, they serve as a vital safeguard against inflation, which hit a 40-year high this year,” researcher Michael Shields said in a December statement.

But Don DePerro, president and chief executive officer of the Columbus Chamber of Commerce, said that while the increase will affect some industries in particular — including hospitality, home health care, fast food and convenience, and janitorial services — he doubts it will affect most Workers in central Ohio were making less than the old or new minimum.

“I don’t know who pays $10.10, but I daresay there aren’t many,” DePerro said in an interview. “It honestly shouldn’t have a big, big impact.”

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The pandemic and a resulting labor shortage initially had companies across the country struggling to find workers in 2021, and DePerro said that hasn’t really stopped. “They turn on themselves trying to find people,” he said.

Market factors have pushed companies that can afford it to offer higher wages — and that pressure to pay more per hour has evolved faster than any increase mandated by law, DePerro said.

“We’re in one of those times where it’s a labor market,” he said.

However, DePerro said the Jan. 1 increase will benefit part-time workers, including high school students, the most.

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The Ohio Department of Taxes has not analyzed how the recent minimum wage increase will affect the amount of taxes state or local governments can collect, according to communications director Gary Gudmundson. He said a rough estimate shows sales tax revenue growing by about $25 million per year, adding to the more than $12 billion in total revenue per year.

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