Kansas restaurant worker pay lagging
It has been a tough year to be in the restaurant business, and Tonya Cott, husband to Sugar Shane, owner of Sugar Shane's in Augusta, has watched as some local eateries have gone out of business as COVID-19 has spread through Kansas and the nation.
Sugar Shane's, however, has been able to keep the doors open and avoid the mask debates that came with it.
"We were lucky enough to prosper ... we have been able to allow customers to come in and not wear a mask," Cott said. "Our staff all wears masks. No matter what side you are on, we are able to accommodate."
And as the restaurant has stayed open, staff has kept getting paid. Despite a starting hourly wage of $2.13 an hour for wait staff — a minimum wage established by the federal government — the staff has done pretty well.
"Most of them are making more than $20 an hour by the time they add their tips in," Cott said.
However, for Kansas, the numbers for restaurant worker earnings are not pretty. According to a new study, the average restaurant worker in Kansas makes $20,400 annually — a salary that ranks 44th in the nation.
"I would love to pay everybody more. ... But there is a limit," said Murray Anderson, owner of Gurty's Burgers and Shakes, along with 12 Brew Drive Thru in Newton. "If you own a restaurant in Newton, Kansas, there is only so much that can be spent because there is only so much coming in."
To calculate the average restaurant staff salary, business.org used each restaurant occupation’s annual salary and the number of persons employed to create a weighted average. Researches included servers, fast food workers, bartenders, dishwashers, hosts and hostesses to create the report.
According to the report, while the average restaurant wage in Kansas is $20,400, the average wage across all occupations is $46,520. That means restaurant workers earn 56% less.
"I have always paid more than minimum wage. We're a family atmosphere, and that is on purpose. That avoids turnover," Anderson said. "My restaurant is a fast casual. ... we bring out the food, but you don't have a waitress/water scenario. A waitress/water scenario will pay their staff $2.13 an hour, and that brings that average way down. The rest is on tips."
Those tips are huge to "front of the house" staff — and how tips are reported may lead to overall salaries showing much lower.
According to Natasha Catton, owner of Neighbor's in McPherson, that starting wage of $2.11 likely skews the numbers downward. Her first job was waiting tables at Neighbors — and it led her to buy the place several years later.
"Servers, when you think about it, are making $2 an hour if they are not getting tips, but in some places they get lots of tips," Cotts said. "As far as cooks, I do think [they are underpaid], but you have to sit there and look at the cost of food. ,,, Compared to some places, [restaurant workers are underpaid], but I love the restaurant atmosphere. I like it more than the factory."
Cotts said cash tips are underreported.
"Business owners do not have any idea how much they are making in cash tips. Our POS system shows us credit card tips, but cash tips, it is all an honor system with what they enter. Most are smart enough to realize if they report those, they are taxed on those. ... It makes it look like they are poverty level, but they are not. .... I don't have a way to make them be truthful. If they show they make a minimum wage, that is all my duty is. "
Nationally, restaurant workers earn an average salary of $24,861 — that’s 54% less than all occupations across the country.
Anderson said the answer is not to raise minimum wage to $15, as has been proposed on the federal level. At his restaurant, which does not employ wait staff, he pays everyone hourly. He believes that would add too much to the labor expense line for smaller, hometown restaurants to handle — and restaurants to close.
He also is concerned about other businesses — like the liquor store he owns right next to his two restaurants.
"We found in the restaurant business, we start out hiring high school people and that is the lower range of the pay," Anderson said. "I don't think someone 16 or 17 ... I was 16 when I started at Dillons and I did not care what I made. ... That is what that job is for, it is entry level."
Cotts said a raise to the minimum wage, and eliminating the tipping system, is not workable.
"It is a Catch 22, the way the government does restaurants. I don't see how it will change," Cotts said. "People are programmed to tip. If we had to pay $15 an hour, that $8 cheeseburger would then cost $18."
"The market sets the price. I can't charge $20 for a burger in Newton, and I can't pay $20 an hour for a cook," Anderson added. "Labor is a huge cost in a restaurant."
Accordng to business.org, states big on tourism, particularly in Las Vegas, employed the most restaurant workers per 1,000 jobs, followed by Hawaii, Montana and Florida. Hawaii has the best pay for restaurant workers, making an average salary of $41,502.
Anderson said that based on his experience traveling and at conventions, it makes sense that restaurant workers in urban areas earn more.
"The difference between Kansas and any urban city, rent is $2,000 a month in the city and you can rent a house in Newton for $600. Cost of living is part of why we are at the lower end," Anderson said.