Minimum Wage Raise

[Ghoulish Delight]

Originally Posted by Alex Stroup

Not many people make minimum wage but those that do would get a 36% raise. But that is also more than a 36% raise in payroll costs which for small businesses with lots of minimum wage labor can be a major blow.

Anecdotal, but I heard one restaurant owner say that if it passes, his solution would be to raise a few menu items in price by 5 cents.

[Alex]

Originally Posted by Ghoulish Delight

Anecdotal, but I heard one restaurant owner say that if it passes, his solution would be to raise a few menu items in price by 5 cents.

And so I didn't say it was an absolute. Some won't have a problem with it and in most states the impact is much less than a 36% increase. It is worth noting that, at least in California this minimum wage increase won't be an increase and in most other states the major class of employees in a restaurant are partially exempt from minimum wage laws.

Some will have problems, many won't, and most will find a way to get on.

I don't mean to say that the hike will have a dramatic negative impact just that it would be better for pretty much everybody involved if minimum wage increases were rationalized.

As opposite anecdotal evidence back when my mom owned her last tailoring shop she had one employee making minimum wage (mostly working the counter and cleaning up). This was not a booming business and on most days she cleared less than $100 (and in certain seasons much less). A $17/day raise for that employee doesn't seem a big deal but it would have been a huge one. I don't know how she would have responded but it would have been a problem.

Better that she know for a year ahead of time that the minimum wage would go up approximately 2% a year than 36% every moon's age when congress decided to get around to it.