Cincinnati Unveils Living Wage Initiative

Program will recognize businesses paying employees at least $10.10 an hour

click to enlarge Pi Pizza CEO Chris Sommers speaks about Cincinnati's living wage initiative Oct. 2
Pi Pizza CEO Chris Sommers speaks about Cincinnati's living wage initiative Oct. 2

While Congress has been wrangling back and forth for months about raising the federal minimum wage, the City of Cincinnati is doing what it can to encourage businesses to pay their employees enough to get by.

The Cincinnati Living Wage Employer Initiative will officially recognize employers paying their employees at least $10.10 an hour, the same hike congressional Democrats have been pushing in the House and Senate. The program looks to reward businesses and nonprofits that take the step, providing a website, cincinnatilivingwage.com, where consumers can check to see which businesses pay employees a fair wage.

Though the program is voluntary, the hope is that positive recognition and consumer pressure will encourage businesses to pay employees a wage that allows them to be self-sustaining.

“Although the city of Cincinnati cannot legislate a higher minimum wage–that’s left up to the state–we do feel we have a crucial role to play in creating a culture of living wage employers,” said Councilman P.G. Sittenfeld at an Oct. 2 news conference announcing the initiative, which he’s helped push.

“Cincinnati cannot wait on Congress to take action,” he said. “But our local businesses and organizations can raise their minimum wage voluntarily and immediately, and individuals can make conscientious consumer decisions about spending their money with those employers.”

So far, four organizations, including the city, are listed as partners in the initiative. One is Cincinnati-based Grandin Properties, whose CEO Peg Wyant appeared with Sittenfeld at the Oct. 2 announcement.

Another is Pi Pizza, which is opening its first store in Cincinnati downtown at Sixth and Main Streets on Oct. 13. The company, based in St. Louis, has paid non-tipped workers at its seven locations in Missouri, Washington DC and elsewhere $10.10 an hour for five months. The company looks to employ about 100 people in Cincinnati.

Pi Pizza CEO Chris Sommers estimates about 75 percent of those employees will be hourly and not working for tips, meaning they’ll benefit from the wage boost. Sommers said the increased payroll costs are more than balanced by reduced employee turnover rates and increased productivity.

“We did it without raising prices, and we did it after extensive quantitative and qualitative analysis to make sure we could pay for it and that we could still grow and expand to cities like Cincinnati,” Sommers said of the wage boost.

He encouraged other businesses to make a similar commitment.

“If Pi Pizza can do it, you can do it,” he said. “It’s the right thing to do. It’s good for business–more people walking around, with not only more money to put gas in their cars, more money to get their cars fixed, but also more people to buy pizza. And that’s important, right?”

Boosting the minimum wage has caused a deep debate in the United States. Proponents, including President Barack Obama, who called for the boost to $10.10 during this year’s state of the union address, say that low-wage workers don’t make enough to survive easily or raise families, boosting dependence on government programs like the Supplemental Nutrition Assistance Program, or food stamps. Opponents, however, including Republicans in Congress like House Speaker John Boehner, say that it will cost businesses more and stifle job growth. Republicans also say that most low-wage jobs are held by high school students, part-time workers who aren’t trying to sustain themselves independently or raise families.

Bureau of Labor Statistics data, however, show that two-thirds of minimum wage workers are over the age of 19. Sommers said that few, if any, of the 107 employees at a recent orientation for Pi Pizza’s Cincinnati location were young students.

The federal minimum wage is currently $7.25, though 23 states, including Ohio, have a higher minimum. The highest wage in the country is in Washington State, where employers must pay adult non-tipped workers at least $9.87. Ohio’s minimum wage is currently $7.95, which will increase to $8.10 in January, thanks to a 2005 constitutional amendment that pegs the state’s minimum to inflation. Even at this new state minimum wage, however, a worker working 40 hours a week will still gross less than $17,000 a year. At $10.10, the same worker would earn $21,000– enough to put a family of three just above the federal poverty level.

“While even the higher hourly wage will leave some people vulnerable, the extra earned income represents the difference between people being able to sustain a basic existence or not,” Sittenfeld said.

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