The city’s unemployment rate is more or less steady, the WSJ notes in this piece, so fans of across-the-board statutory wage hikes can tell themselves that these anecdotes are just that — anecdotes, not data suggesting a large-scale shift.
But wait a few months, as they’re not done yet raising the minimum wage in NYC. Although it’s already $15/hour for businesses with 10 or more employees, those with fewer than 10 can pay as little as $13.50 an hour. Come January 1, that’ll change and every worker in New York will need to receive $15/hour.
The smallest businesses, already operating on tight margins and crushed with exorbitant rents, will be squeezed tighter while the bigger boys cope more comfortably. That’s progress for you.
Susannah Koteen, owner of Lido Restaurant in Harlem, said she worries about the impact raising wages could have on her restaurant, where she employs nearly 40 people. She hasn’t had to lay off anyone, but the increase has forced her to cut back on shifts and be more stringent about overtime. She said she changes her menu offerings seasonally and raises prices more often since the wage boost.
“What it really forces you to do is make sure that nobody works more than 40 hours,” Ms. Koteen said. “You can only cut back so many people before the service starts to suffer.”…
While Ms. McNally said she always has paid her employees at least $5 above minimum wage, January’s increase tightened that gap. “With raising minimum wage to living wage, it feels now like we’re at the bottom of the pay spectrum,” she said. “There’s absolutely no benefit to being a retail business in New York.”
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.
Koteen was planning to move to a bigger location but scrapped that idea because she can’t afford to hire more people now. Sacrifices like that have been going on piecemeal in service industries since the new $15 mandatory wage took effect in January, as CBS noted at the time:
Bloostein said he has scaled back on employee hours and no longer uses hosts and hostesses during lunch on light traffic days. Customers instead are greeted with a sign that reads, “Kindly select a table.” He also staggers employees’ start times. “These fewer hours add up to a lot of money in restaurants,” he said…
A New York City Hospitality Alliance survey of 574 restaurants showed that 75 percent of full-service restaurants reported plans to reduce employee hours this year in response to the latest mandated wage increase. Another 47 percent said they would eliminate jobs in 2019. Eighty-seven percent of respondents also said they would increase menu prices this year.
Not even socialist icons are immune from basic economics on this point, as we were recently reminded. But dogma is undeterred: Every member of the Democratic 2020 top tier has endorsed a national $15 minimum wage, and even centrist-y longshots like Amy Klobuchar and John Hickenlooper have followed suit. In fact, when Politico checked around with the various campaigns in June, the one and only Dem in their enormous field who outright opposed a $15 hourly minimum wage was Michael Bennet, who favored a $12 wage instead.
There are certain progressive proposals that the far-left chatters about, like the Green New Deal and abolishing ICE, which are unlikely to pass even if they had total control of government. (Pelosi wouldn’t immolate the centrists in her caucus for either plan, I think.) But there are others, like gun control, on which there’s such unanimity of opinion and on which they’ve expended so much rhetoric that they’d have to follow through if given the chance regardless of whether some are reluctant to do so. The $15 minimum wage is in that category. The problems faced by small businesses in New York will be faced by every small business in the country if government flips next year, never mind what NYC entrepreneurs have to say about it. Or CBO, for that matter.