New York City Businesses Struggle to Keep Up After Minimum Wage Increase

Wall St. Joural ^ | August 5, 2019 | Alexa St. John

[grundle]

More than six months after the $15 minimum wage went into effect in New York City, business leaders and owners say the increased labor costs have forced them to cut staff, eliminate work shifts and raise prices.

Thomas Grech, president of the Queens Chamber of Commerce, said he has seen an uptick in small-business closures during the past six to nine months, and he attributed it to the minimum-wage legislation.

“They’re cutting their staff. They’re cutting their hours. They’re shutting down,” he said.

“Many people working in the restaurant industry wanted to work overtime hours, but due to the increase, many restaurants have cut back or totally eliminated any overtime work,” he said.

[ealgeone]

Color us stunned!

[W.]

What a shock, what a surprise...

[P.O.E.]

How dare those greedy businessmen. /s

[I want the USA back]

Good. Hoping they all go bankrupt for voting dem.

[mistfree]

Bernie Sanders, please pick up the yellow courtesy phone. There is a call for Mr. Sanders on the yellow courtesy phone.

[econjack]

There’s not one economist worth their salt who wouldn’t have told politicians this would be the result. If a minimum wage is such a good idea, ask the politicians: “Why not set the minimum wage at $2000/hour?” Even they would say that’s too high and no one would get hired. Then ask them: “What on earth made you think $15/hour was going to be different?” Their answer: crickets... It’s political posturing at its worst.

[bert]

Stunned?

Many here constantly advocate raising wages to obtain workers. The dogma of raising wages to obtain workers is repeatedly put forward. It would seem that with a general rise in wages, New York would be awash in willing workers eager to sign on for the raised wages

[Chode]

do I really have to say it???

[Sacajaweau]

The layoff folks can go work for Amazon.....Oh...Never mind.

[Alberta's Child]

The fundamental issue here is simple: Ask someone how much they’d be willing to pay someone to do Task X. Then ask them how much they’d charge to do the same Task X for someone else. If the person answering the question was honest, there is a huge gap between what they’re willing to pay and what they’d demand to be paid for the same thing.

At some price point even Wall Street bankers in NYC would leave their jobs to go and work behind the counter at Starbucks. Unfortunately for Starbucks, that price point is probably at least $300 per hour.

[bill1952]

You continually vote in these leftist bastards
Enjoy your victories

[mewzilla]

Now imagine what this is doing to Upstate....

[mewzilla]

It’s not just about wages, though.

It’s also about productivity.

Politicians don’t get or refuse to get part.

[bert]

The article alludes to a business fundmental

The fundamental reason for owning a business is to make a profit.

Wages are a function of profit. If wages are raised to a point where there can be no profit in a competitive business, the raise will kill the business.

Contrarily, To maintain employees in a competative enviroment, the wages must be maximized within the limits of profitability.

[gr8eman]

Play stupid games, win stupid prizes!

[Paleo Pete]

I have to wonder why they didn’t learn from Seattle.

If I remember correctly, Seattle did this and started with a partial increase to $11 something, 6 months later half the restaurants in Seattle had closed. Meanwhile the usual 5% or so had closed outside Seattle, where the minimum wage hike was not in effect. My liberal relatives still insist those restaurants were going downhill and closing anyway, it had NOTHING to do with the wage hike killing profits...

Even the normal minimum wage hikes of a dollar at a time or less always result in the same scenario. Newer (minimum wage) employees laid off, everyone else’s hours cut, prices raised.

Then everyone else higher up the food chain wants a raise too. They got a raise, where’s ours? Profit goes out the window, something has to give. Guess who goes first...the same ones liberals claim they want to help. Minimum wage employees.

Oh damn I’m forgetting...liberals NEVER learn...

[Bonemaker]

Good...make New York into a giant boarded up Cairo, Illinois you fools.

[ExSES]

Now imagine what this is doing to Upstate....

State MW is $11.10/hour. $15/hour is a CITY MW...

[gibsonguy]

“Good. Hoping they all go bankrupt for voting dem.”

These business owners are probably among the small number of R’s left in NY. Of course the “workers” were for this right up until the moment they lost their jobs.