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Minimum wage rises

One recent day, Amy Allen's 14-year-old daughter, Anna, texted her exciting news.

"Mom, I got a raise," she wrote.

Anna, who her mother said takes care of dogs at an Alexandria veterinary kennel, saw her wages rise from $7.75 an hour to $7.87 an hour beginning Jan. 1. That's because for the first time ever, Minnesota has mandated that minimum wage tracks with inflation, with some exceptions. Anna is one of about 250,000 Minnesotans who receive minimum wage, according to state estimates. Minimum wage depends on the size of the employer. Minimum-wage workers for large employers saw their earnings go from $9.50 an hour to $9.65 an hour on Jan. 1.

It's not easy to find minimum-wage workers in Alexandria, where a labor shortage has prompted many employers to boost pay. Even those former minimum-wage bastions, fast food joints, have upped the ante. In Alexandria, a starting KFC employee gets $10.50, said district manager Kenny Baymon.

"At one point we were at $11 just to recruit some more people," he said. "In small towns like Alexandria sometimes it's hard to get seasonal workers and you have to pay above the norm."

Retail too used to pay minimum wage, said Judith Nemo, but that's become challenging in Alexandria.

"It's so hard to find people that you have to pay more," said Nemo, the owner of Magpie, a shop along Broadway, Alexandria's main downtown boulevard.

Restaurant wait staff are still among those typically receiving minimum wage in Alexandria, mostly because tips often boost them well above that level.

Robbie Carlson, owner of Angelina's, said his employees have benefited from the increase, particularly his wait staff. About a month ago, he said, he raised pizza prices by $1 per pizza to cover the higher wages. His servers, he said, often pocket $200 to $300 in tips per shift.

Still, the minimum-wage doesn't work for all restaurants.

"None of my employees make that little," said John Brezina, owner of The Muddy Boot in Forada. "Especially when I was looking for a bunch of help last summer; I offered $10 to my bartenders."

He has raised burger prices to accommodate rising wages.

"I'm scared to see when it goes up to $15, what that'll do to my burgers," Brezina said.

Nearly a third of the YMCA's 130 employees make minimum wage, said Jackie Peters, senior program director. As a large employer, its minimum-wage workers began making 15 cents more an hour at the start of the year.

"Because it was a subtle increase, it wasn't impactful on our bottom line," Peters said.

Meanwhile, Anna has plans for her earnings, her mother said.

Among them: a car, a trip to New Zealand, school and a big pedal-harp.

"She was thrilled" with the latest raise, Amy Allen said. "She's saving."

Minimum wage background

In 2014, Minnesota lifted the minimum wage to $8. It had been $6.15, set in 2005.

The minimum wage then rose to $9 in 2015 and $9.50 in 2016 for employees of large companies, those which do at least $500,000 in business each year. For smaller companies, the wage rose to $6.50 in 2014, $7.25 in 2015 and $7.75 in 2016.

Starting in 2018, minimum-wage workers of both small and large companies have their wages pegged to inflation, not to exceed 2.5 percent in one year. There are other exceptions. The state can opt not to raise the minimum wage if the state's economy appears ready to tank. And if inflation falls, the minimum wage will not follow suit.

The wage increase does not apply to babysitters, taxicab drivers, people providing police or fire protection, and those whose jobs fall under the provisions of the U.S. Department of Transportation, such as drivers, mechanics and loaders.

Each year, by August 31, the state will announce the minimum wage taking effect the following January 1. If it cancels an increase, it must do so by Sept. 30.