Workers earning the state’s minimum hourly wage received a raise Saturday as the rate increased from $10.10 an hour to $12 an hour.
Gov. David Ige in June signed a bill hiking the wage in four steps that eventually will boost it to $18 an hour in 2028, the highest in the nation.
When he signed the bill, Ige said the increase will benefit more than 190,000 workers.
Victor Lim, legislative liaison for the Hawaii Restaurant Association, on Friday said most restaurants are “well-prepared” for the hike to $12 an hour, and many already made that increase after the law passed.
“As far as restaurants are concerned, $12 isn’t a big deal,” Lim said. “It’s the next steps that are the issue.”
Lim said the current economic downturn has made businesses’ profit margins even slimmer than normal, with costs of materials and utilities spiraling ever upward.
He said restaurants should still be able to cope with the hike on Saturday and even the planned hike to $14 an hour in 2024, but unless the downturn reverses itself, the increases to $16 and $18 in 2026 and 2028, respectively, could be too much.
“If the economy gets better, maybe people can deal with $18 an hour, too,” Lim said. “But if it doesn’t get better, a lot of small businesses, especially in East Hawaii, are going to be challenged.”
The bill received support among Hawaii workers during its progress through the state Legislature.
The state branch of the American Federation of Labor and Congress of Industrial Organizations, representing more than 68,000 workers statewide, noted in April that the increase will support the state’s most economically vulnerable workers, who are themselves being disproportionately affected by the economic downturn.
The Hawaii Alliance for Community-Based Economic Development estimated in April that the increase will grant minimum wage workers more than $16,000 in additional pay by 2026.