SOUTHFIELD, Mich. (WXYZ) — Michigan's minimum wage jumped from $12.48 to $13.73 per hour on Jan. 1, marking a significant increase that has workers celebrating while some restaurant owners express concerns about rising operational costs.
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The wage increase affects thousands of workers across the state, with tipped employees also seeing their base pay rise to $5.49 per hour, representing 40% of the minimum wage.
"I think we definitely need to be compensated for all of our hard work, our efforts," said Janelle Washington, a cashier at Kerby's Koney Island in Southfield. "It's a lot, it really is. It seems minute until you do it, you really won't understand, unless you actually do a server or a carry out job for a time, you won't understand."
For workers supporting families, the increase provides much-needed relief amid rising living costs.
"I have a big family, I have a family of five. Kids are expensive, I'm expensive by myself so, even when you're trying to budget and cut down stuff is still expensive so, yeah it helps," said Halisa Brown, a server at the restaurant.
Michael Greiner, an associate professor of business at Oakland University, views the wage increase as beneficial for both workers and the broader economy.
"This is something though that actually will put money in the pockets of people, it will be money that people tend to spend, because people who are at or around the minimum wage they tend to have not a lot of discretionary income so they tend to spend everything that they get," Greiner said.
However, the Michigan Restaurant and Lodging Association warns the increased minimum wage will strain the restaurant industry.
"The minimum wage taking effect January 1 will hit restaurant operators with a 30% increase in the standard minimum wage and a 37% increase in the tipped minimum wage from last January, while restaurant industry revenue is projected to be flat in 2026. For many, the reality is setting in that they will be forced to either cut labor or raise menu prices to keep their doors open, knowing full well that affordability is the number one concern on the mind of most consumers right now."
Not all restaurant owners share this outlook. Mauro Queiro, owner of Mangiabevi Urban Italian in Sterling Heights, believes flexibility is key to managing the change.
"Some prices are going to go up and in my point of view if you're a good restaurant owner, a good chef, you can try to change a few things in the menu to make it more affordable, change the protein you put in the menu," Queiro said.
The wage increase is part of Michigan's plan to gradually raise the minimum wage to $15 per hour by 2027.
"It's being increased very gradually because of the fact that they don't want to have it be too dramatic of an impact on the employers and kind of hurt their ability to hire new employees," Greiner said.
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