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Possible minimum wage increase in Renton could pass down to customers

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(The Center Square) – A number of Renton-based workers are campaigning for a ballot proposal that would increase the city’s minimum wage to about $19, but some businesses are warning that consumers would be impacted.

The Raise the Wage Renton campaign is collecting signatures to add the minimum wage ordinance to the city’s November ballot. The campaign mentions that Renton is home to nearly 60,000 workers due to the city being home to the Landing shopping center, the Downtown Urban Center, as well as retail and commercial office and warehouse districts.

However, city officials’ outreach with Renton business owners reveal their goods may increase in costs. In a Renton Committee of the Whole meeting on June 26, the Renton City Council was briefed on the potential impacts of the minimum wage being increased from the statewide minimum wage of $15.74 to $18.99 for employers with more than 500 employees.

According to the meeting, most businesses indicated that the added expenses included with a potential minimum wage increase would be passed onto their customers. This ranges from food prices to the cost of child care services.

“Many debate and say higher salaries could argue that it gives people more disposable income to be able to spend in the city, which would increase sales to our businesses,” Renton Finance Director Kari Roller said in the Committee of the Whole meeting. “Others can say higher salaries would indicate businesses need to increase their prices [and] impact businesses that have a really small profit margin.”

Some business owners mentioned to the city that employees who work in Renton commute from other parts of the Western Washington region, which in turn does not help Renton residents. There were also indications that businesses would look to leave the city to avoid extra work and resources if the minimum wage resolution were to move forward.

The city conducted a separate survey to hear from Renton businesses, with 130 responses.

When asked if the minimum wage increase would impact their businesses, 30% said it would, and 48% responded “no.”

Out of the number of respondents that said it would impact their businesses, 47% said it would negatively impact their decision to continue operating in Renton.

Roller estimated that for the city to implement a program to enforce the minimum wage increase could cost “anywhere between $1 million to $2 million per year for the city” to support five full-time equivalent positions to oversee the minimum wage resolution, if passed by voters.

Roller added that the city could raise taxes to support the program or cut other city programs.

Renton’s neighboring cities have increased their minimum wages to be some of the highest in Washington state, as well as the rest of the U.S. The City of SeaTac raised its minimum wage 8.6% at the start of 2023 from its 2022 minimum wage of $17.54 per hour to $19.06 for hospitality and transportation employees. That is the highest in the U.S., with Seattle following at $18.69 per hour.

On July 1, Renton’s neighboring City of Tukwila raised its minimum wage for employees of large employers to $18.99. Renton is attempting to match that same rate.

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