ST. PAUL, Minn. - It's official, St. Paul's City Council has approved a minimum wage increase to $15 an hour and it will be phased in by 2025 for all businesses.
St. Paul Mayor Melvin Carter just signed it into law.
The move follows the footsteps of Minneapolis, which made the jump to to the same number this summer.
Before Wednesday's vote in St. Paul, if you work for a big business, minimum wage was $9.65 an hour and for small businesses, it was $7.87.
St. Paul will have the $15 minimum wage in place by 2023 for big businesses and 2025 for small ones.
One point of controversy, however, is tipped workers. Typically, they make lower than minimum wage, but make up for it in tips.
In St. Paul's latest law, tipped workers will make the same as every other wage worker, a minimum of $15 an hour. Many employers are worried this will drive up prices at restaurants.
Some places in Minneapolis have already adopted the new wage guidelines and told KARE 11 it's working for them.
"We built all of the salary and wages into cost on the menu," said Daniel Swenson-Klatt, owner of Butter Bakery Cafe in Minneapolis.
Debates about minimum wage increases have played out across the United States over the past few years. So far, research on employment impact is mixed, according to University of St. Thomas economics professor Tyler Schipper.
The debate is a little more nuanced.
"There is a lot of tension, even within economics, about what is the best minimum wage policy? And how does it help or hurt employment?" Schipper said.
The most prominent example of a wage increase is Seattle, which became the first city to pass a phased-in $15-per-hour ordinance back in 2014. All businesses will be required to pay their workers a $15 per hour wage by the end of this year.
"Seattle was the guinea pigs of all guinea pigs," said Jake Whittenberg, an anchor and reporter at TEGNA sister station KING 5 in Seattle who has closely followed research on wage impacts.
Researchers from the University of Washington just published a new study revealing earnings gains for experienced workers, with no significant decline in employment. This contrasted with the team's earlier research.
“What new studies have found is they’re not cutting back on staff quite so much," Whittenberg said. "In fact, they’re cutting back on hours.
A UC Berkeley study of six cities with wage increases also found that food-service employees saw more money in their pocket overall-- without huge job losses.
But every city is different, and St. Paul has taken a slower route by phasing in 15 dollars by 2025 for all businesses.
Schipper says a higher minimum wage will be a strong tool in this thriving economy, but it won’t fix everything.
"It's not going to cure poverty in the city," Schipper said. "There’s a lot of other policies in terms of housing, training for new jobs, that will be much more targeted toward poverty."