Study weighs potential minimum wage increases across Boulder County

The Common Sense Institute released a new study Thursday weighing potential minimum wage increases across Boulder County.

Authored by Chris Brown, CSI vice president of Policy and Research, the latest economic analysis shows the potential changes to the minimum wage across five municipalities within Boulder County, including Boulder, Longmont, Lafayette, Louisville and Erie.

“Importantly, the overall impact on prices and employment mask the more pronounced impact to certain industries and businesses,” Brown said. “Restaurants face an increase in labor costs of more than 20%, raising their operating costs 7%. This would wipe out the average restaurant margin meaning younger workers and consumers are left with the tab.”

According to the study by CSI, a nonpartisan think tank based in Greenwood Village, by 2030 Boulder County’s minimum wage of $25 would be 53% or $8.70 higher than the statewide rate of $16.30.

The City’s Commissioned Report found the following:
• By 2030, for every one person estimated to be drawn out of poverty from this policy, between four and 12 people would lose a job.
• For every person who loses a job, between 2.5 and eight people would get paid more.
• Nearly 90% of jobs lost will be younger workers under the age of 25.
• Sectors that represent “main street” businesses face larger direct increases to both labor and operational costs.
• Restaurants face a 21% increase in labor costs and a 7% increase in operating costs, larger than the total average profit margin for a typical business.
• Grocery stores face a 13% increase in labor costs and a 1.6% increase in operating costs.
• Retail stores face a 7.6% increase in labor costs.
• Employment within the food accommodation sector in Boulder is already down 3% from 2019, the lowest among 12 of the state’s largest counties.
• Colorado’s recent investments in tax credits to support lower income workers and families means that a single parent making minimum wage and working 32 hours a week, would see an effective increase of $3.58/hour or $5,964 in total earnings after state and federal tax credits.

Read the full report here.