The "$100,000 waitress" was the talk of the day Tuesday. Minnesota gubernatorial candidate Tom Emmer discussed a lower minimum wage for people who work for tips, arguing that some restaurant servers make upward of $100,000 a year and that businesses needed more wage flexibility.
It was sound off time after that.
Leah Wilkes is a Network source who moonlights 10 to 15 hours a week at a Twin Cities café. That's the real situation for many people who wait tables. It's not a career. It's a means to bring in some needed cash in a state that has one of highest percentages in the nation of people who work multiple jobs.
That minimum wage check, however, serves a very practical need, says Wilkes.
"I can't remember the last time I actually got a paycheck from my service job. In other words, the paychecks are garnished to cover the taxes on the tips that I make," she told us.
"It's not icing on the cake and usually at the end of the year, I owe a little more." She add:
Almost all service industry people I know don't have benefits. I do, because I work another job. But for the majority, any illness or injury (off the job) is not covered and I have seen people lose their shirts for emergency visits - not only in the cost of care but also in the lost shifts. There is no such thing as "sick time" in the service industry. You miss the shift, you lose the money.She also noted that "on average, a bartender will make 15 to 20 percent of their sales. So a $100,000 a year bartender, for instance, would be generating $500,000 in sales. "Multiply by that by several servers and bartenders and it sounds like a pretty successful restaurant to me."As the MPR story noted, $9.36 is the current estimated median wage of wait staff in Minnesota and a state expert says only 10 percent of the state's servers earn more than $17.64 an hour or $37,000 a year."I wait tables to supplement my full time day job," said Christine Rosenquest, a Network source from Minneapolis who described her occupations as auditor / waitress."Tips are never a guarantee! My tips can range from $50 for a Saturday night to $300. Tips depend on everything from the weather, holidays, and a person's mood. Not to mention that waiting tables is a hard job."
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In a McKinsey Global Institute study on U.S. multinational corporations this statistic stood out:
Forty years ago, the United States was a leader in high school graduation rates; today, it ranks 18th out of 24 industrialized nations.
This chart makes it visually clear that we've lost ground on high school graduation rates since the early '70s.Since hitting 77% back then the high school completion rate has declined to 69%. Simply put, these are scary numbers.
Yet the rate of return on getting a high school diploma is very high. For instance, a suggestion paper by economists James J. Heckman, Lance J. Lochner, and Petra E. Todd suggests a 40% return on getting a high school diploma and some 65% for black men. (You can read the paper here.)
Here is an intriguing set of numbers trying to estimate the economic impact in Minneapolis of boosting the high school compeletion rate in the school system. I realize that these are guesstimates by the Alliance for Excellent Education (a good think tank on the issue), but I found this figure particularly striking:
The region would likely see increased human capital, with 53 percent of these new graduates likely continuing on to pursue some type of postsecondary education after earning a high school diploma.