Each month, Alexandra Liriano, a cashier at Ikea, hands over most of her paycheck to her mother to help pay the family’s bills. Soon, a 16 percent raise to Ikea’s new company-set $9.29-an-hour minimum hourly salary will put more money into her pocket.
“It will help me have a little extra for myself, as well as pay for school,” said Liriano, 20, who lives in Pembroke Pines with her mother, brother, stepfather and aunt and is studying criminal justice at Broward College.
Although the Florida Legislature did not raise the state-mandated minimum wage during its last session, some minimum wage workers — like the Ikea cashiers who ring up your Swedish biscuits, the salespeople at Gap who help you find your T-shirt size, and the tellers at C1 Bank who deposit your checks — will see their pay increase.
Companies including Ikea and Gap — which also owns Old Navy, Banana Republic, Athleta, Piperlime and Intermix — have recently announced or instituted voluntary increases in their minimum wages ahead of proposed national legislation that could mandate a new federal floor. St. Petersburg-based C1 was ahead of the pack in Florida, raising its “living wage” to $14 in April.
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The businesses cite such reasons as a desire to attract and retain talented workers and boost productivity, and to enable employees to earn a decent living.
For C1 Bank, the increase carries a deeper meaning.
“I was raised by a single mother in New Hampshire who worked as a secretary, so I have this personal feeling, and I really understood personally what it is like to work below a living wage,” said C1 Chief Executive Trevor Burgess.
Nationwide, the federal minimum wage is $7.25 an hour. In Florida, which adjusts its minimum hourly wage for inflation, it’s $7.93. For a full-time employee working 40 hours per week, that comes to $317.20 per week or about $16,500 per year. Florida’s poverty line is $23,850 for a family of four. The Legislature adjourned in May without taking up a proposed hike to $10.10 an hour.
A bill before Congress calls for raising the minimum wage, in three steps, to $10.10 by 2016. It would then have an annual adjustment for the cost of living. President Barack Obama supports the bill, which could be considered by Congress this fall.
The organization Business for a Fair Minimum Wage also supports the measure. Holly Sklar, the group’s executive director, said 28 million workers across the country would benefit if the minimum wage were lifted to $10.10 by 2016.
“Today’s $7.25 minimum wage has less buying power than it had in 1950, and a third less than in 1968, adjusted for inflation,” said Sklar, who is based in Boston. “We can’t build a strong economy on a falling wage floor.”
The controversial bill faces strong opposition from major businesses and industry groups, including the National Restaurant Association, the National Retail Federation and the Florida Retail Federation. They argue that the increase would lead to higher labor costs for employers, job losses and reduced hours for employees, as well as fewer opportunities for young and entry-level workers.
“A retail job is often the first opportunity for someone with few skills entering the job market, and retailers believe in investing in a well-trained workforce,” said Rick McAllister, president and chief executive of the Florida Retail Federation, in a statement.
“Raising the standard of living for low-wage employees is a worthy cause. Raising the minimum wage would not create more opportunities for less-skilled workers, and there is substantial evidence that a mandated wage hike would result in fewer entry-level jobs,” he said.
The Congressional Budget Office estimated in a report released in February that the proposed federal raise to $10.10 per hour would reduce total employment by about 500,000 workers, or 0.3 percent.
Last month, Gap raised its minimum wage to $9 and plans to raise it to $10 in June 2015. The increase affects workers across all of its brand stores. In South Florida, there are dozens of Gap and Gap-affiliated stores.
Gap said the majority of its stores’ workers already earn more than the federal minimum wage. Still, its in-house minimum wage increases will benefit 65,000 company employees, according to the company’s website.
Ikea just announced it will raise its minimum wage in January 2015, pegging it to the “living wage” in each community in which it has a store. For the new store opening in Sweetwater later this summer, the rate will be $10.79.
That store, Ikea’s first in Miami-Dade County, expects about half of its newly hired 350 workers, including Liriano, to benefit from the increase. Ikea bases its living wage on the Massachusetts Institute of Technology Living Wage Calculator, which takes into consideration housing, food, medical and transportation costs, plus taxes.
Carolina Reynoso, 23, who juggles two jobs — training as a part-time cashier at the Ikea in Sweetwater and working at a clothing boutique — will use her raise to help pay off $35,000 in student loans from culinary school.
“It will make it easier to make the payments,” said Reynoso, of Kendall, who also gives her mother $200 or more a month to help with expenses.
The hike in Ikea’s minimum wage is “the latest in a series of investments made in the last year to make sure it’s the greatest place to work,” said Selwyn Crittendon, store manager at the Sweetwater Ikea. Other recent measures include making contributions to a new retirement fund, boosting the company’s 401(k) retirement account match and making all employees eligible for bonuses.
“It gives us the opportunity to attract and keep great talent in this building,” Crittendon said. Ikea has said the move will not result in cutting employees’ hours or increasing its prices.
Other major companies also have come out in support of a higher minimum wage, including Costco, which already pays workers $11.50 or more in every state in which it operates.
The push to raise the wages of America’s lowest-paid workers has been going on for months. In Miami and cities across the country, fast-food workers have staged protests for higher wages. So far this year, 10 states and the District of Columbia have enacted minimum wage increases, Sklar said.
Companies that have increased their in-house minimum wages cite positive outcomes, including lowering employee turnover and boosting productivity and customer satisfaction.
C1’s Burgess said that not only did the wage hike help those affected by the raise — mostly tellers — it also boosted other employees’ pride in the bank and led to an influx of new customers.
“We’re trying to be a bank by entrepreneurs for entrepreneurs,” Burgess said. “I need the very best people interacting on the front line, so if I am paying $14 an hour, I will be able to attract the best people.”
At C1, the wage increase affected 26 of 220 company employees. All are women.
“That was my original inspiration, my mother and my childhood experience,” Burgess said. “I was excited that this was able to change the lives of so many women raising families.”