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Post Falls restaurant feeling the strain of Idaho's growing minimum wage issues

Part of what drives up what Idaho employers offer is just across the border in Washington state.

POST FALLS, Idaho — The White House Grill in Post Falls has a reputation for good food and, owner Raci Erdem says, 25 years worth of finding and keeping good workers.

"It was always my dream to have at least 95% of my employees to have livable wages," Erdem said

Under Idaho's current minimum wage, which hasn't budged since 2009, Erdem's two Idaho restaurants could pay $7.25. But, he says that's really not an option.

"Everybody talking about minimum wage, minimum wage, minimum wage," Erdem said. "We don't have even one employee in the tipped employees making $7. It's at least $13."

Part of what drives up what Idaho employers offer is just across the border. Washington has one of the highest minimum wages in the country, according to the department of labor. It's been sitting at $15.74 since Jan. 1.

"There is pros and cons," Gonzaga Associate Professor of Economics Ryan Herzog said. "Some of the pros obviously for Spokane is it attracts some labor to the market."

The latest numbers from Idaho's Department of Labor show that in 2019, around 4,600 people commuted from Spokane to work in Kootenai County every day. But, more than double, 9,800, commuted from Kootenai County into Spokane

"It's basically tourist dollars going into Idaho, but then that creates more strain on the labor market as they are living in Idaho and demanding Idaho services but not providing the labor in Idaho," Herzog said.

Herzog says the growth of big business in Idaho is an added strain. Corporate employers coming in can pay $20 an hour, something many smaller shops can't match.

"What's ultimately happening for these smaller businesses is they're resorting to reduced hours, they're resorting to more work hours for the business owner, things like that," Herzog said. "It is a challenge."

But, the minimum wage difference and labor shortages also come with issues for Washington.

Greater Spokane Inc. plays a big role in business recruitment and retention. And sometimes, according to Public Policy Director Jake Mason, the higher pay in Washington can make it a less enticing location for businesses.

"Looking at Idaho, with, you know, not only a much more business friendly environment, but also this minimum wage differential, it becomes a bigger piece of the picture when businesses are looking to either locate here or sometimes even looking to expand," Mason said.

Erdem sees it at his Liberty Lake restaurant, where he can't split tips between his employees.

"When you pay a server $16 an hour and on top of it they get $200-300 in tips, and you have your kitchen staff, how are you going to make them happy?" Erdem said.

But, he'll keep doing what he can for all of his staff, no matter the cost.

"The challenge for the whole region is overcoming some of these labor shortages we're dealing with," Herzog said.

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