I know that’s a long title, but it is taken from a comment after a blog post about Seattle’s upcoming minimum wage hike to $15.00 per hour. The hike goes into effect on, of all days, April Fools Day. The “Living Wage” has long been one of the liberal alters. At that wage, working forty hours a week and fifty-two weeks a year you’ll earn just over $31,000.00 a year. The rub is that minimum wage jobs are SUPPOSED to be entry level jobs to help train young folks some work ethic and give them some independence in their lives. The minimum wage job is not supposed to be your career! The other rub is that at $15.00 per hour those entry level jobs are going away. Businesses cannot afford to pay that much to someone to sweep floors, serve burgers, or check coats. Seattle is finding that out as pointed out in the Protein Wisdom Blog;
“Seattle’s $15 minimum wage law goes into effect on April 1, 2015. As that date approaches, restaurant across the city are making the financial decision to close shop. The Washington Policy Center writes that ‘closings have occurred across the city, from Grub in the upscale Queen Anne Hill neighborhood, to Little Uncle in gritty Pioneer Square, to the Boat Street Cafe on Western Avenue near the waterfront.’ Of course, restaurants close for a variety of reasons. But, according to Seattle Magazine, the ‘impending minimum wage hike to $15 per hour’ is playing a ‘major factor.’ That’s not surprising, considering ‘about 36% of restaurant earnings go to paying labor costs.”
 The good news for Seattle workers is that the minimum wage is going to be $15.00 per hour…the bad news is that you no longer have a job…Oh and not just you, but the wait staff, the cooks, and probably the owners. If you are lucky they may just cut your hours, but they probably already did that to avoid Obamacare provisions. This article was good in that it quantified the impact of the new wage minimum which often is ignored;
“He estimates that a common budget breakdown among sustaining Seattle restaurants so far has been the following:
- 36 percent of funds are devoted to labor,
- 30 percent to food costs,
- 30 percent go to everything else (all other operational costs),
- The remaining 4 percent has been the profit margin,
and as a result, in a $700,000 restaurant, he estimates that the average restauranteur in Seattle has been making $28,000 a year. “With the minimum wage spike, however, he says that if restaurant owners made no changes, the labor cost in quick service restaurants would rise to 42 percent and in full service restaurants to 47 percent.â€
So when an owner’s costs increase six percent (36% to 42%) where does that increase come from? When it has to come from the lowly 4% of profits the math no longer works and the restaurant closes. If they cut the labor costs (i.e. eliminate your job) something suffers at the restaurant and if things slide no one will eat there and the restaurant closes. Try different scenarios and try to find one where it works for the owner. Please remember that the owner’s responsibility is to make money for his family not to provide jobs for you.
I don’t usually spend much time reading comments of blog posts. They are generally feed lowly weirdo’s ability to say nasty things anonymously. Or maybe I’m jealous about how few comments I get other than spammers. A series of comments from “bh” caught my eye and here are a few. By the way “bh” inspired the title of this post.
“The real problem as I see it is this country thinks it deserves a higher standard of living than it earns in labor.”
“Flashback: when I was 12-13 I used to sweep up and do grunt work in the new housing division to pull in some cash for the family.  Flashforward: at 41 I tell a kid that if he shows up on his birthday rather than partying I’ll pay him time and a half and buy him a beer to spare. He doesn’t.”
“What no one in this group understands is how you can’t live at a higher level than your work output. If you don’t show up for work, if you have no skills, if you’re a liar, if you’re a junkie… then you’re not worth what your parents told your delicate little ass.”
“This is what people get wrong about the very idea of minimum wage: anyone who is competent and reliable becomes something like a manager in about three months. They become actual managers in six. Competency and reliability are becoming that rare now. Go to work everyday. Pay attention. Imagine that you can solve problems as they come up rather than stare at your phone in the alley. Guess what? You now run the place you’re complaining about.”
Amen!
“The real problem as I see it is this country thinks it deserves a higher standard of living than it earns in labor.”
