On January 1, 2025, Seattle welcomed the new year by increasing the minimum wage to $20.97 an hour. Although the increase can benefit workers, many small businesses are closing or are affected by the raise. Wage laws in Seattle are progressive compared to other states, and aim to ensure workers can afford basic necessities with the rising cost of living, while combating the income inequality in the city as well.
In response to the increase, restaurants are streamlining their processes, Bradley Chase, the manager of Tom Douglas restaurants, explained. Streamlining operations is the process of simplifying specialized jobs. “Instead, servers and managers do more of [the] tasks in the dining room and chefs and cooks do [more] of them in the kitchen, requiring fewer employees,” Chase said. Additionally, some restaurants use “tip share” policies, offering “a more equitable pay system between the front and back of the house employees,” Chase said. Tip sharing is when employees share a portion of their tips to other employees which has lessened the pay of bartenders. “As a result, the industry here has lost most of its career servers and bartenders,” leaving Seattle’s restaurant scene struggling to find professionals in their place.
Additionally, even for larger companies, many workers still struggle with Seattle’s high cost of living. “Most people I work with still have a very hard time keeping up with rent, bills and travel costs of living here,” Chase said. “While these measures have kept our restaurants successful in terms of financial viability,” Chase said, “we still need to regularly raise prices as the progressive wage periodically goes up according to the city’s established schedule.”
Unfortunately, this increase has also been too strenuous for many small businesses, forcing many to close doors. On January 3, 2025, Jackson’s Catfish Corner closed for a second time. Located in the Central District, the family-owned restaurant had been cumulatively open for forty years. Originally opening for business in 1985, Catfish Corner ran until 2014, before the family chose to close due to high rent and state taxes. As a means to carry on the family legacy, in mid-2021 Terrell Jackson reopened Catfish Corner in its recent location, 23rd and Jackson. Juneteenth marked the grand (re)opening, the concept being to bring Black owned businesses back to the historically Black Central District. However, due to the rising costs, Jackson made the decision to permanently close. “I just think I did all I could do in Seattle, you know what I’m saying? I don’t want this to be a sad time,” Jackson shared in an Instagram video. “I don’t have the team, the structure, I don’t have nothing right now,” Jackson explained, and he is not the only one.
Bebop Waffle Shop, Bel Gatto Bakery, Plum Bistro and many other businesses have stated that they are closing down for the same reason. In an interview with Fox 13 TV, Corina Luckenbach, the founder of Bebop Waffle Shop, stated that the wage raise caused her business to “financially just not make sense anymore. Because, just for me, the increase would cost me $32,000 more a year.” Bebop, as well as other businesses, could not have predicted the raise, but due to business size could not have sustained the raise regardless.
For smaller businesses, raising prices can wager customer count. Not simply just a price raise, wage raises impact the workers in unlikely ways as well. While it is assumed that the raise can only be beneficial for workers, Chase stated that “as the prices go up, tip percentages tend to go down, so there does seem to be a bit of a backlash inherent to this process.” Not only less generous tips, but fewer jobs and working hours tend to be a major result. “We cut our hours drastically and never went back to them. It cost too much to employ staff for later or slower hours,” Pete Morse, previous owner of Mission Cantina, explained. And so, many owners are currently at a crossroads on approaching the wage raise.
The shuttering of establishments proves not to be simply a financial loss, but a cultural one as well. The minimum wage increase, though believed to help combat the poverty in the city, is most likely leading to more inflation and job loss and more closings can only be projected as time goes on.
