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Minimum wage hikes trigger 'payroll tsunami,' as small businesses cut back

Posted by mminnick 6 years, 3 months ago to Economics
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Recall the old adage: "The road to Hell is paved with good intentions"
Raising the minimum wage puts the squeeze on the employer of low skill workers. The value add just isn't there.
From the article:
"Small business owners across the country are beginning to feel the pinch as more states move toward a $15 minimum wage.
While proposals to raise pay are intended to help workers, several mom-and-pop coffee shops as well as restaurants are responding by cutting hours, eliminating jobs or closing down entirely because they can't keep up with rising wages under the law."

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  • Posted by freedomforall 6 years, 3 months ago in reply to this comment.
    You are both correct. The Fed causes all the inflation that exists by funding government deficits and expanding credit beyond actual growth (to benefit banksters, boost real estate prices, and expand tax bills.) Then the statists use the inflation as an excuse to institute more government meddling and looting.
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  • Posted by mminnick 6 years, 3 months ago in reply to this comment.
    I beg to differ. It stops when the progressive governors of the states are tossed out and the progressive agenda repudiated by the voters. I find it interesting that the majority of the states adopting the 15/hr minimum are Democrat governed. Not all but most.Once again using OPM to fund the socialist dreams.
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  • Posted by CircuitGuy 6 years, 3 months ago
    This is not one of those issues where we have to rely on experts. Macro 101 explains why price floors create surplus supply, in other words minimum wages cause there to be more people seeking jobs than offering them, i.e. unemployment.

    I think minimum wage policies are a tempest in a teapot, though, because after a lot of political grandstanding they usually end up essentially adjusting it for inflation at a level not far for the going rate for entry-level labor. The raise for people at the minimum is not enough to change their life, and businesses that struggle to pay the minimum would struggle in any case.

    Even though the minimum wage is not set a level that has much effect, it's a plausible way for people to scapegoat the gov't about why their wages are too low or their business is struggling. That mindset leads to people to look to the gov't to manage their lives instead of feeling like they're responsible for their own lives and for maintaining a gov't. I think this is one reason why the right to bear arms is toward the beginning of the Bill of Right: in addition to being about the right to protect yourself, it's about the*mindset that we the people are the adults, the ones responsible for taking care of business.
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  • Posted by $ 25n56il4 6 years, 3 months ago
    Great $15 an hour. $31,176 a year! That's a pretty good wage. $2,598 a month. $120 a day. (40 hour week x 4.33 weeks in a month x 12 months). Not bad for washing dishes. But the real problem is the increasing costs we see every day. As wages rise, so does the cost of gasoline, food, rent, utilities. Where does it stop?
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