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$15 minimum wage didn't decimate the local economy, after all
Critics would have you believe that upping the minimum wage in restaurants will lead to massive layoffs and closures. But since raising the minimum wage to $15 per hour nearly a year ago, the restaurant industry in New York City has thrived.
I'm a professor with a focus on labor and employment law. My research on the minimum wage Critics would have you believe that upping the minimum wage in restaurants will lead to massive layoffs and closures. But since raising the minimum wage to $15 per hour nearly a year ago, the restaurant industry in New York City has thrived.
I'm a professor with a focus on labor and employment law. My research on the minimum wage suggests a few reasons why this might be true.
The article goes on to explain why the rise in the minimum wage has not been as bad as had been predicted; in fact, it claims the both restaurant revenue and employment are up.
However, these claims are contradicted by 2 Anonymous Coward submissions, which could be from the same AC but we cannot tell, of the same story from the New York Post:
As predicted, the $15 wage is killing jobs all across the city
https://nypost.com/2019/09/30/as-predicted-the-15-wage-is-killing-jobs-all-across-the-city/
Just as predicted, the $15 minimum wage is killing vulnerable city small businesses, with the low-margin restaurant industry one of the hardest-hit as it also faces a separate mandatory wage hike for tipped staffers.
In Sunday's Post, Jennifer Gould Keil reported on the death of Gabriela's Restaurant and Tequila Bar — closing after 25 years. It struggled all year to find a way out, gradually laying off most non-tipped employees, including some chefs, only to find that quality suffered and customers fled. Owners Liz and Nat Milner finally hung it up.
Other eateries share the pain. In an August survey of its members, the NYC Hospitality Alliance found more than three-quarters have had to cut employee hours, more than a third eliminated jobs last year and half plan to cut staff this year.
"It's death by a thousand cuts," the Hospitality Alliance's Andrew Rigie told The Post, since "there's only so many times you can increase the price of a burger and a bowl of pasta."
Finally, there is another AC submission which claims that the minimum wage has had an effect - but that it is only part of the story. It is important to consider the increase in rents in NY City, and that there might be a shift in the entire market.
Famous Restaurant where Alexandria Ocasio-Cortez Bartended Closes Due to Rising Minimum Wage
[...] And yet, even this high level of sales wasn't enough to inoculate the business from the rising cost of rent and wages in New York. Coffee Shop co-owner and president Charlies Milite told Forbes that rent had become "unusually high," accounting for close to 27% of the restaurant's gross revenues. Add in the scheduled $2-per-hour minimum wage hike set to take place on December 31—an increase that, across Coffee Shop's 150 employees and multiple dayparts of service, would have added $46,000 to the monthly payroll—made it impossible to break even by cutting costs elsewhere.
"It's a wakeup call for our industry in general," Milite said. "When a restaurant is one of the top-ranked restaurants in America, sales-wise, and can no longer afford to operate, you have to look at that and say there's a shifting paradigm in the business."
Original Submission #1 Original Submission #2 Original Submission #3 Original Submission #4
(Score: 2) by etherscythe on Friday November 01 2019, @05:38PM
Maybe they don't, although I do think there is a particular respect that is shamefully lacking. I'm not poor, but I'm sitting here eating my meal which cost me less than $3 (YMMV by region). It's not glamorous, and I could afford better, but it's good enough. Eating out, having a waitstaff tending to your needs, is a luxury. If you're poor - by definition, luxury is the first thing you're cutting from the budget. At some point, everybody has to decide for themselves when it's more valuable to keep their money than pay someone else to wait on them. For those who save up for that nice date night, wouldn't you rather be getting that person who isn't frazzled and stressed about making rent, have a little time for banter (or through better service free up your time to banter with the people you came with) and really get your money's worth? This is a social opportunity partially wasted because the worker doesn't have the freedom to do anything more than the bare minimum for you due to pricing pressure driving down their personal resources and driving up their table count. Yet you feel entitled to this experience, at their expense?
Maybe we don't any of us need to eat at those kinds of places all the time. Maybe we need to make the dining experience more personalized and special, by making the everyday meal experience a simpler and less expensive one by paying all workers a decent wage and letting automation and economy of scale keep the prices down for basic meals that do not need waitstaff. If the simple meal is healthy enough at a good price, this can work for everyone. This requires a bit of adjustment on the part of fast food places and supply chains, and your rural areas need high quality foodstuffs available at decent prices which may require some kind of subsidy and/or regulation, but it can be done. I daresay not everyone is skilled enough to provide that fine dining experience and might be better served with a job running the automated machinery, too.
But if you just want to watch someone else scurry for your benefit, to feel better about your place in the world - maybe you should be paying a fair price for their time, and the bill should reflect that. The tipping model currently makes it too easy not to pay people what they're worth, and tragedy of the commons has ensued.
"Fake News: anything reported outside of my own personally chosen echo chamber"