The Washington Free Beacon, (2/4/15) provides an example of “what happens when the minimum wage is raised to double the current federal level…San Francisco is providing a perfect example–and the results are not all that surprising.
“Alan Beets, founder of independent bookstore Borderland’s Books, is closing his doors because the city raised the minimum wage to $15. The bookstore, which employs five people, has weathered challenges such as bigger bookstores and online shopping, but the minimum wage hike proved too much to overcome.
‘It’s not that I can’t afford to pay higher than minimum wage, but I can’t afford to pay minimum wage that gets that high,’ Beets said.”
Members of the socialist/fascist left somehow “feel” that business owners are wealthy and money is abundant – that there is plenty of money to increase the minimum wage so that all will be well with the world. Unfortunately, that is just another one of those “feelings” liberals get that lacks any logical basis in fact.
In the real world, not only do many small business owners not have the money to pay artificially increased salaries for entry level jobs, but paying those higher salaries does an extreme disservice to the economic and social fabric of the nation.
The idea of entry-level jobs is that they are entry level jobs. They don’t pay well. They offer a win-win situation, allowing for relatively cheap services and products while allowing people to gain skills that can then be applied in other, higher paying jobs. Sometimes those other jobs are with the same business and sometimes they are in other jobs or careers. Either way, it is those low paying jobs that give people many of the skills they can use to improve their financial status.
Of course, people in lower paying jobs often have to work hard. Those who do so gain experience, a sense of responsibility, resume content, and references. They are able to move up the career/financial ladder. If they choose to add to their work experience by enhancing their educations, they may do even better.
The outline here is simple. Rather than expect more money for entry-level jobs, use the skills learned in those entry-level to work toward higher paying jobs.
If the minimum wage for supposedly lower paying jobs continues to increase beyond the capacity of business to provide those wages, businesses will take one of three actions.
1.) Pass the increased expenses on to customers, thereby increasing general costs for products for everyone, including the employee who supposedly gained from a higher wage. It ends up as a break-even.
2.) Develop more efficient ways to provide their services or products, for example through the use robots or through implementation of self-order and/or self-check-out. This will limit the opportunity for people to gain skills and therefore limit their opportunities to gain higher paying jobs in the future.
3.) Or, the employer might simply close the business as is the case in the San Francisco example above.
Pricing oneself out of the market is not smart business. It hurts not only the individual but also the business involved. The UAW has already proven that by nearly putting the US auto industry out of business.
Work is a set of progressive steps to the highest level of employment attainable by an individual. Work is empowering. That is the American way. Welfare in the form of a mandated, unrealistic minimum wage hinders that progression and therefore hurts everyone. That is the socialist/fascist way.