When the Minimum Wage Goes Up, the Menu Price Also Rises

Supporters of a higher minimum wage applauded Gap’s decision last week to increase hourly pay. While Lynn Albright, vice president of the company’s Old Navy brand, told CNN that higher prices won’t be needed if costs can be lowered by, for instance, reducing staff turnover, the effects of such decisions often trickle down to customers.

In the restaurant industry, some chains have already prepared to boost menu prices in response to minimum-wage changes in such large markets as California, New York, and Washington. At the national level, Congress and President Obama continue to grapple with increasing the federal minimum wage; progress could bring similar hikes at eateries across the country.