One way or another the consumer is going to pay for the increase in the cost of doing business. I guess if the business owner wants to increase the price of the menu items then he/she also has to pay for the expense of producing new menus. If you have to quickly do something to offset the additional expense then a surcharge is probably one way to do it. Either way as a consumer I would expect prices to go up in businesses that employ minimum wage workers.

I know a local restaurant owner who has a decent place and it's not like he's rolling in big profits. He's a regular middle income guy trying to make a living and support his family. I can't imagine just taking a hit to the bottom line to cover the increase in expense unless whatever market you're in is so competitive you can't raise prices. However it seems that everyone would be in the same boat.

I won't share my perspectives about the minimum wage itself, but local businesses in my area started a stated "surcharge" on their billing, and I see it as a cheap shot. Unless, as a restaurant owner, you're going to be transparent about all of your costs and increases on your bills, then this "living wage" surcharge simply targets your workers. I would not patronize a restaurant that did this.

Unless, as a restaurant owner, you're going to be transparent about all of your costs and increases on your bills, then this "living wage" surcharge simply targets your workers.

There is it is.

I would not patronize a restaurant that did this.

Good for you.

A workforce that is paid more has more to spend.

On things like eating at restaurants.

I think that in Oregon minimum wage is $9.25, it's posted on a wall in my workplace breakroom-but I rarely pay attention to it.

Restaurants are always a dicey proposition for the owners, so I don't think throwing them in to the mix for minimum wage argument is valid. Fast food places, well, yes, their prices have been rising and it is not tied to the min wage here, I know that. I was recently at a place and the burger meal was $10-but you could also order a less expensive menu option.

Retailers will see an effect, and very small business will, but it will eventually even out. The large corporations are the ones with the most employees at minimum wage, and i think that too many who argue about the rising of min wage forget that. I know that the 60 year old woman working at JC Pennys is not making $40K a year working there.

Since it's been over 40 years since i worked a minimum wage job, I don't know what current wages are like, but I know that my kids who went to work after HS in positions other than corporate owned retail made more than minimum wage. One DD worked at a local food co-op and was paid $11/hr versus the min wage she made working for Kmart. My son worked for a man who made specialty art works and he was on salary-well above min wage. He also worked for our local Sat Mkt for more than min wage. And we're talking about KIDS here-not adults trying to raise a family.

So I really don't have a problem with raising minimum wage. If it means eating out less, then I will. But I'll still be buying goods and services I need.

Great points, Jakabedy. Anecdotally, those I know who benefit from a minimum wage increase don't actually spend more... they're either paying down debt or saving it.

So many factors to this issue, not the least of which is online shopping, which is having a detrimental impact on local businesses (chain and otherwise) that employ a local population and contribute to the local tax base.

WTH do they want? I guess they want it to stay $4.25 like it was over 30 years ago. *rolls eyes* So ridiculous! What they should have done is been raising it gradually over the years!

What if business owners decreased their profit margins in order to pay their employees more? Are most of them struggling so badly themselves that they could not do so?

I have not seen nor spoken to my ex in many years but he owns a small electronics business. At one time he was paying the handful of employees who assembled his product about $8 an hour, and every one of them had a family to support. The salary he drew for himself was in the mid to high six figure range. I'm not saying he's the norm, because I don't know, but I can't help wonder if there are many out there like him who could and should be providing more for that "unskilled" labor that he could not do without.

It really depends upon the business. Just in terms of restaurants,
the chains answer to their stockholders so paying their workers more is
that type of issue. Smaller local restaurants generally run on slim
margins. So an increase like the OP described means tens of thousands of dollars a year.

Overall, restaurant profits are up but so are operating costs.
Many restaurants near me don't "publish" their menu prices because they
rely so much on local suppliers, and so their menu prices adjust
regularly. To me, this actually seems more transparent than adding a living wage
surcharge. That's like they're saying, "Hey, don't blame me for your bill. I have to pay these people more."
Business
owners like your ex would take the supply/demand of labor argument, as
well as noting that if one of his workers wants to make his salary as a business owner, they
can go start their own. And if our country focused on
individual liberty, that argument would be valid.

Lisa, that's precisely what he did say, and his inability to view others with compassion and understanding is but one of many reasons I couldn't stay married to him. He was probably right when he hurled the ultimate insult at me: "You're a socialist!" Yeah, well. There are worse things to be.

I think what we're seeing from the comments above is that there is a fundamental disconnect between what consumers believe about business profits and what individual business owners experience. I find it's a pretty standard assumption among non-business owners that there is plenty of profit that should be reallocated to labor. I actually agree to the extent that labor over the last 25 years hasn't shared in the rewards of increased productivity. However, a one-size-fits-all increase in the minimum wage - a 50-100% increase in the cost of labor -- isn't something a small-margin business can easily absorb. Particularly if there isn't much in cash reserves to weather a transition.

"I think what we're seeing from the comments above is that there is a fundamental disconnect between what consumers believe about business profits and what individual business owners experience. "

I think to a certain extent this is a true statement. Another factor that I hate to bring up is other expenses that keep going up. For us, during the past year monthly insurance costs per person went up from approximately $900-1,000 per month to $1,300 to 1,400.

These kind of increases are extremely hard on small businesses. Since we pay 100%, the employer does not understand the impact.

Edited: Typos

Jakabedy,

Thanks for that post. My knee jerk reaction was yes, raise minimum wages! Your honest and thorough example is not, I think, unusual. Food for thought.

My DH also owns a small custom manufacturing business though all of his employees are paid well over minimum wage. He pays himself very little - less than some of the minimum wages mentioned above. Well he probably pays himself less than minimum wage if you count all the hours he works. He bought an underperforming company and if there are any profits he reinvests them in the business so it can grow and improve. He provides health insurance though the price has become exorbitant for everyone since the ACA. He pays everyone a small bonus based on company performance. He has managed to create three new jobs at well over minimum wage in the last four years. He firmly believes business should create jobs not government.

Just another example of the business owner's actual experience vs what the non-business owner might think. Things like minimum wage decisions can have a very significant impact on small business owners who aren't big bad corporate America.

3katz4me, your DH's example is why our country's paradigm of placing the burden of providing health insurance on employers is destructive in so many ways, and this was the model long before ACA. There are far too many business decisions made by both employers, as well as employees who chose work based on insurance or remain in dead-end jobs that inhibit their ingenuity, and this model has been a massive hinderance on the ingenuity our country could have. I'd love for your husband not to be burdened by healthcare expenses and take that money to build and create more jobs at his business. Likewise, if one of his employees feels "stuck" in their job and wants to venture off to try something new and innovative, wouldn't that be great if he/she could?

ACA is/was a mess and wasn't executed properly. Things before it weren't headed in the right direction, either. In the past few years since ACA, though, I've witnessed more business ingenuity among individuals who felt confident leaving their dead-end jobs and found more industrious ways to contribute to society on their own, knowing they could buy into the exchange. Without it, we'll send droves of wonderfully creative, innovative people back to their cubicles. And I bet your DH's situation doesn't improve with this appeal, either.

(My comments above aren't indicative of the working environment your DH creates for his employees. They are intended for the millions of workers who are peons for the sake of corporate profits because they need the insurance.)

My sister lives in Seattle was strongly opposed to the statewide living wage law because she thinks the law was pushed by people from Seattle and environs who don't understand that the east side of the state is an entirely different economy with a much lower cost of living, and where the higher minimum wage could be much more damaging. I grew up on the east side of the state, and now live in the very high cost San Francisco Bay Area (where many cities have recently past living wage laws as well), and I agree with my sister that anything applied statewide need to be suitable for the lowest cost area just as much as the highest.

Lisa - health insurance wasn't a burden for DH prior to ACA. It was affordable for all and not a problem. That's not the topic of this thread though - it's the impact of minimum wage.

Thank you for sharing your ideas and concerns. I'm sure by next summer many will not even remember the price increases. I do think at least for some places, the surcharge is a way to help customers understand the reason for the increase. I live in a pretty small, vocal town and FB can be brutal. Cawaps, I do wonder how this will play out in the more rural areas of the state. I hope the business owners are able to find ways to keep employees and continue to make the profits they need.

I'd love to see more of a living wage- I work in childcare, have a Masters, and yet when it costs my family a day's worth of pay to eat out, I find that outrageous. We are not spendy- family of 6, so a meal would run around $60. We always order water, but only go out about once a month, if that. Our grocery bill runs 300-350 a month.

My bad. I started the health insurance issue trying to show the issue from the business owner's side. While my employees are no where near minimum wage, an across the board increase is salaries hits the small business owner hard.

Businesses face a real conundrum. They don't want to commit to pay the help more or be forced to provide benefits (increase their fixed expenses) but they all need the help to have buying power beyond basic living needs (landlord, groceries, utilities and health insurance) or nearly all of the businesses will close down.

In my area when the current commercial property leases are up (lease = fixed expense) the properties are going vacant and the person who is really taking the hit is the landlord.

But business vacancy is part of a cycle. I think that the reason that California continues to limp along with a large economy is the fact that we have earthquakes. After earthquakes people absolutely have to spend money to fix things and that puts money that's been tied up in savings back into the economy-at least for a while. The fix it cycle is followed by a longer but slower cycle of keeping up with the Joneses-as people repair their properties, their undamaged neighbors decide that they want to make some changes too.

I suspect the same thing may be true in some of the other natural disaster prone states except that some of those disasters are so emotionally devastating (Katrina) that people elect to move instead (often to the Pacific Coast and take their chances with the earthquakes).

3katz, I didn't post about health insurance until you raised the issue. If the topic of this thread is only minimum wage, why did you bring up your husband's business if it's not a company whose model is based on minimum wage? That's "not the topic of this thread," either.

Not about to argue with you Lisa

Then perhaps avoid random judgement calls about what topics can/cannot be discussed and by whom.

Jakabedy, I just quickly looked for some info and found that MIT calculates a living wage for Alabama to be $10.17 / hour. That would be if the earner is working 40 hours a week and all 52 weeks a year.

In my own state, I'm surprised to see MIT puts it at $10.02.

http://livingwage.mit.edu/states/01

For the Mimou-GW in Washington, MIT says $11.23.

http://livingwage.mit.edu/states/53

Those numbers can be fine tuned to city or metro area within a state using their quick calculator.