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Beginning in April, the city of Seattle begins its transition to a minimum wage of $15 per hour. Businesses have seven years to come into compliance with that over a series of staged pay-bumps.

Recently, the Seattle Weekly published an article, which has circulated through some conservative circles as proof that raising the minimum wage is damaging to business.

http://www.seattlemag.com/article/why-are-so-many-seattle-restaurants-closing-lately

However, the Seattle Times reached out to the owners of the businesses reportedly closing over the minimum wage hike, and found that, in every case, the increase of the minimum wage had absolutely nothing to do with the closures (and, in one case, the business was sold to a friend of the owner who plans to reopen it under a new name).

http://www.seattletimes.com/seattle-news/politics/truth-needle-is-15-wage-dooming-seattle-restaurants-owners-say-no/

A livable wage hurts nobodies' interests, unless your interests are in keeping poor people on slave wages (in which case, feth you.).

Well, Oakland CA (where I live) is already on that train- our minimum wage went up to $12.20/hour in February, and will continue to rise yearly until it hits $15/hour.

The immediate consequence of this is that every restaurant in the area has jacked up their prices, which is annoying, but what can you say I guess.

The damage will take a while to be apparent.

Studies by 3 different organizations (2 academic, 1 business) in this area indicate that the average Seattle restaurant could "absorb" the cost of the wage increase with no more than a 5% increase in price.

So the $5 cheeseburger would then cost $5.25. That isn't a significant price bump (especially when one considers the ripple-effect of an increase in the minimum wage).

 BlaxicanX wrote:
Well, Oakland CA (where I live) is already on that train- our minimum wage went up to $12.20/hour in February, and will continue to rise yearly until it hits $15/hour.

The immediate consequence of this is that every restaurant in the area has jacked up their prices, which is annoying, but what can you say I guess.

And this should surprise no one. It's not like the huge increase in money that now has to be paid in wages just comes from no where.

 BlaxicanX wrote:

The immediate consequence of this is that every restaurant in the area has jacked up their prices, which is annoying, but what can you say I guess.

See, living in the Puget Sound area (Im a bit south of Seattle, but prices are just as ridiculous), I can say that basically every restaurant has already jacked up their prices, especially fast food, to a point where my family won't/can't really go out.

One thing I've personally seen, from friends on my rugby club... Is depending on where you work/live this (minimum wage hike) can be harmful immediately. For instance, one of the towns outside of the SEATAC airport raised it's minimum wage to $15. This increase did not affect a single airport employee as they were a part of Seattle, and not this other place. As a result in the increase on the price of goods, most of these guys are really hurting financially, nearly to the point of being homeless.

 BlaxicanX wrote:
The immediate consequence of this is that every restaurant in the area has jacked up their prices, which is annoying, but what can you say I guess.

Show of hands for all those surprised.

So... no more tipping?

 Swan-of-War wrote:
So... no more tipping?

Only if you want shamed on Twitter.

 Grey Templar wrote:
The damage will take a while to be apparent.

The damage is also masked a little due to the more affluent nature of Seattle. Lots of tech companies down there like in Silicon Valley mean people can afford (or are used to) higher prices that stores require for this wage. Also, the wage isn't $15 yet so the impact isn't as severe as an overnight pay raise would have been.

 Breotan wrote:

 Grey Templar wrote:
The damage will take a while to be apparent.

Also, the wage isn't $15 yet so the impact isn't as severe as an overnight pay raise would have been.

What people fail to understand that is that minimum wage labor costs constitutes 100% of a businesses expenses. This is why raising the minimum wage will always lead to a direct increase in prices in exact proportion to the increase in the minimum wage. It's plainly obvious it's impossible to make any sort of positive change with an increased minimum wage since the only effect will be to diminish the buying power of those making above minimum wage, as the buying power of their dollars are decreased. It does nothing meaningful for those making minimum wage because the direct increase in the price of goods and services causes them to break even, no better than they were with the old minimum wage.

If there were other factors to the cost of goods like fuel, non-minimum wage labor, land, taxes, raw materials, rent, equipment, equipment maintenance, marketing, shrinkage, insurance, licensing, energy, R&D, transportation, security or human error that wouldn't be the case. In such a fantasy universe minimum wage increases might grant those making it increased buying power, while not affecting the buying power of those above them by a large margin because the cost of goods & services would only go up relative to the moderate to minor portion of their cost made up by minimum wage labor.

However we do not in such a fantasy land, so a minimum wage increase will always be a net loss for everyone.

 Chongara wrote:

 Breotan wrote:

 Grey Templar wrote:
The damage will take a while to be apparent.

Also, the wage isn't $15 yet so the impact isn't as severe as an overnight pay raise would have been.

What people fail to understand that is that minimum wage labor costs constitutes 100% of a businesses expenses.

wat?

Not 100%, but it is a significant portion of the costs of those businesses.

 whembly wrote:

 Chongara wrote:

 Breotan wrote:

 Grey Templar wrote:
The damage will take a while to be apparent.

Also, the wage isn't $15 yet so the impact isn't as severe as an overnight pay raise would have been.

What people fail to understand that is that minimum wage labor costs constitutes 100% of a businesses expenses.

wat?

Don't question common sense. Who are you, Obama?

 Psienesis wrote:
Studies by 3 different organizations (2 academic, 1 business) in this area indicate that the average Seattle restaurant could "absorb" the cost of the wage increase with no more than a 5% increase in price.

So the $5 cheeseburger would then cost $5.25. That isn't a significant price bump (especially when one considers the ripple-effect of an increase in the minimum wage).

They can, but the problem is that they won't.

In a lot of places here, prices have risen by 50 cents to a dollar. Restaurant owners aren't raising their prices because they're in danger of going bankrupt due to the wage increase, they're raising their prices because the wage increase provides an excellent excuse to raise prices and make more money.

That said, there's more to the situation [here] then the wage increase for why prices are rising. In general, the SF bay area is already one of the most expensive places to live in in the country, with the tech-boom it's just getting worse. Feels like every computer programmer and data analyst in the world is flocking here.

 Chongara wrote:

 Breotan wrote:

 Grey Templar wrote:
The damage will take a while to be apparent.

Also, the wage isn't $15 yet so the impact isn't as severe as an overnight pay raise would have been.

What people fail to understand that is that minimum wage labor costs constitutes 100% of a businesses expenses. This is why raising the minimum wage will always lead to a direct increase in prices in exact proportion to the increase in the minimum wage. It's plainly obvious it's impossible to make any sort of positive change with an increased minimum wage since the only effect will be to diminish the buying power of those making above minimum wage, as the buying power of their dollars are decreased. It does nothing meaningful for those making minimum wage because the direct increase in the price of goods and services causes them to break even, no better than they were with the old minimum wage.

If there were other factors to the cost of goods like fuel, non-minimum wage labor, land, taxes, raw materials, rent, equipment, equipment maintenance, marketing, shrinkage, insurance, licensing, energy, R&D, transportation, security or human error that wouldn't be the case. In such a fantasy universe minimum wage increases might grant those making it increased buying power, while not affecting the buying power of those above them by a large margin because the cost of goods & services would only go up relative to the moderate to minor portion of their cost made up by minimum wage labor.

However we do not in such a fantasy land, so a minimum wage increase will always be a net loss for everyone.

Wait, how does overhead not affect costs? I'm confused.

If a business can't pay its employees a livable wage and remain viable, then it was never viable, merely perpetuating its own existence through exploitation.

EDIT: I suspect Chongara might have been going for a bit of the old "sar-casm", alas he's fallen victim to Poe's Law, because neoliberals really do spout off crap like that often enough it's hard to tell when folk are satirising them.

 Chongara wrote:

 whembly wrote:

 Chongara wrote:

 Breotan wrote:

 Grey Templar wrote:
The damage will take a while to be apparent.

Also, the wage isn't $15 yet so the impact isn't as severe as an overnight pay raise would have been.

What people fail to understand that is that minimum wage labor costs constitutes 100% of a businesses expenses.

wat?

Don't question common sense. Who are you, Obama?

You're being awfully simplistic, that's all.

Min Wage Labor costing 100% of business expenses leaves nothing for overhead, supplies, manager wages, etc...

 Ensis Ferrae wrote:

 BlaxicanX wrote:

The immediate consequence of this is that every restaurant in the area has jacked up their prices, which is annoying, but what can you say I guess.

See, living in the Puget Sound area (Im a bit south of Seattle, but prices are just as ridiculous), I can say that basically every restaurant has already jacked up their prices, especially fast food, to a point where my family won't/can't really go out.

One thing I've personally seen, from friends on my rugby club... Is depending on where you work/live this (minimum wage hike) can be harmful immediately. For instance, one of the towns outside of the SEATAC airport raised it's minimum wage to $15. This increase did not affect a single airport employee as they were a part of Seattle, and not this other place. As a result in the increase on the price of goods, most of these guys are really hurting financially, nearly to the point of being homeless.

That town was Seatac (the city of) and not sure how they are arguing that the airport is part of the city of Seattle when it's surrounded by the city of Seatac. Something isn't adding up there.

 Psienesis wrote:

 Ensis Ferrae wrote:

 BlaxicanX wrote:

The immediate consequence of this is that every restaurant in the area has jacked up their prices, which is annoying, but what can you say I guess.

See, living in the Puget Sound area (Im a bit south of Seattle, but prices are just as ridiculous), I can say that basically every restaurant has already jacked up their prices, especially fast food, to a point where my family won't/can't really go out.

One thing I've personally seen, from friends on my rugby club... Is depending on where you work/live this (minimum wage hike) can be harmful immediately. For instance, one of the towns outside of the SEATAC airport raised it's minimum wage to $15. This increase did not affect a single airport employee as they were a part of Seattle, and not this other place. As a result in the increase on the price of goods, most of these guys are really hurting financially, nearly to the point of being homeless.

That town was Seatac (the city of) and not sure how they are arguing that the airport is part of the city of Seattle when it's surrounded by the city of Seatac. Something isn't adding up there.

I believe it has to do with jurisdiction. Port of Seattle is administered by King County council. Seatac is a city with a separate city council.

So here's a thought. Assuming all the restaurants are raising their prices excessively to support the wage, and customers can't afford to dine out, even with the minimum wage increase, supply and demand suggests they will have to lower their prices, which won't be close to putting them out of business given a 5% price increase is all that is apparently needed to cover a $15 minimum wage.

Based on that, it'll be a mess for a couple years then steady out.

I got into this debate. I argued that, if you want to lift people out of poverty, make job training more available to the next generation. Because poverty is generational often.
I then argued that if I was a landowner Who makes his living of renting, I should be able to jack up my prices. After all, it's only fair right?

 BlaxicanX wrote:
Well, Oakland CA (where I live) is already on that train- our minimum wage went up to $12.20/hour in February, and will continue to rise yearly until it hits $15/hour.

The immediate consequence of this is that every restaurant in the area has jacked up their prices, which is annoying, but what can you say I guess.

You might also say the immediate consequence is that people on minimum wage are earning something slightly more livable, which would have been the point of the law, right..?

Wait, do servers in Seattle even make minimum wage? I thought wait staff didn't even make minimum wage to begin with, hence tips.

 KalashnikovMarine wrote:
So here's a thought. Assuming all the restaurants are raising their prices excessively to support the wage, and customers can't afford to dine out, even with the minimum wage increase, supply and demand suggests they will have to lower their prices, which won't be close to putting them out of business given a 5% price increase is all that is apparently needed to cover a $15 minimum wage.

Based on that, it'll be a mess for a couple years then steady out.

The problem is once things steady out people will be right back where they were.

Raising minimum wage helps nobody and just causes a period of upheaval.

 Grey Templar wrote:

 KalashnikovMarine wrote:
So here's a thought. Assuming all the restaurants are raising their prices excessively to support the wage, and customers can't afford to dine out, even with the minimum wage increase, supply and demand suggests they will have to lower their prices, which won't be close to putting them out of business given a 5% price increase is all that is apparently needed to cover a $15 minimum wage.

Based on that, it'll be a mess for a couple years then steady out.

The problem is once things steady out people will be right back where they were.

Raising minimum wage helps nobody and just causes a period of upheaval.

In a universe where literally the entire cost of running a business is paying people on minimum wage, that would be true.*

Will this raise the cost of GW products in Seattle a la Australia?

 Psienesis wrote:

That town was Seatac (the city of) and not sure how they are arguing that the airport is part of the city of Seattle when it's surrounded by the city of Seatac. Something isn't adding up there.

Seatac itself (the airport; Runways, terminals, baggage claim, etc) falls under the Port of Seattle, and not under control of the City of Seatac. This issue was also visible (though to a lesser degree) in the town/city of Burien just to the West of the airport.

So basically, all the employees working "inside the fence" of the Seatac Airport fell under Port of Seattle employment, and so when min. wage was raised, it was not raised for them. This meant that all the people being paid by Seattle, but living in Seatac or Burien, etc. were being a bit left behind when the cost of goods went up. This either forced people to demand more pay, move (which is expensive), or find another job somewhere else that would allow them to remain where they were and still survive.

 Grey Templar wrote:
The problem is once things steady out people will be right back where they were.

Raising minimum wage helps nobody and just causes a period of upheaval.

This is only true if 2 conditions are met: 100% of a business's expenses are directly tied to minimum wage, and all places raise wages simultaneously. Neither of these are true. Gas prices may rise in Seattle, but not all of the price of gas is directly tied to wages and people can always drive a little away from town and buy cheaper gas there. The manufacturing and shipping cost of all that cheap junk in Walmart? Not affected.

 JimOnMars wrote:
Gas prices may rise in Seattle, but not all of the price of gas is directly tied to wages and people can always drive a little away from town and buy cheaper gas there.

Dude gas prices here are fething ridiculous. Everywhere else I've lived in the US, fuel prices were fairly predictable around a community. That is very much not the case where I'm at. Take for instance, last month I used to only buy fuel by my school because it was the cheapest around Tacoma, Puyallup, Lakewood, etc. (I go to school in Lakewood); and out by my house it was pretty expensive (comparatively). Now, just yesterday when I filled up, that is completely flipped; Lakewood is now the expensive stuff, and out by where I live is the "cheap" stuff