…the higher the minimum wage goes, the more restaurants – which rely heavily on low wage workers – go under. And the fewer new restaurants open.
Excerpted from Sean Higgins’ article at the Washington Examiner:
San Francisco’s higher minimum wage is causing an increasing number of restaurants to go out of business even before it is fully phased in, a new study by the Harvard Business School found.
The closings were concentrated among struggling, lower-rated restaurants. The higher minimum also caused fewer new restaurants to open, it found.
The city’s minimum wage is currently $13 an hour, compared with California’s rate of $10.50 and the federal rate of $7.25. The city’s rate is set to increase to $14 in July and again to $15 next year. That rate, unlike federal law, does not include an exception for tipped employees.
Five-star restaurants were largely unaffected, while ones with a 3.5 star rating were 14 percent more likely to fail when the city’s minimum pay rate rose 10 percent above the state’s minimum. The failure rate increased steadily as the restaurant’s ratings declined.
Higher minimum wages also reduce the rate at which new restaurants open by 4-6 percent per $1 increase in the minimum, the study found.
I doubt this is shocking to anyone with an open mind and a functioning cerebrum.
I do not doubt that it is shocking to people with closed minds and cerebrums that are voluntarily shut down rather than remaining open to absorb news which belies what they think they “know”.
no, No, NO !
Raising the minimum wage will lead to MORE employment in restaurants …. particularly fast food.
Well, more employment of . . R O B O T S, anyway
.
Robots, kiosks, whatever used to be either financially unviable or marginally less expensive but, on a humanistic level, not worth taking away people’s jobs. The $15 an hour economic geniuses left that concern in the dust.