The emergence of another casualty of California’s decision to hike the minimum wage to $20 per hour comes as no surprise to anyone who understands basic economics: the real minimum wage is actually zero.
When making their way to work Monday morning, Navarro and her team learned upon arrival that the restaurant owner had made the decision to close its doors for good. The owner, Loren Wright, told local Fox affiliate KMPH that this was the “last thing” they wanted to do, but knew by Friday night the business likely wouldn’t be able to absorb the wage hike…
“And those who are still working in the areas around us that went up to $20 an hour, they got their hours severely cut.”
A 29% increase in the 30% of your business costs (labor, typical for a restaurant) in one day will make it impossible for most businesses to continue using the same number of people. Especially given the average restaurant has a profit margin of 3%.
governments are all a % on top . and unfortunately an increasing %
Californians voted for this, they can live with it.
The voters in Silicon Valley don’t do fast food. They don’t care. Well … they DO buy Boba tea and Soba noodle bowls … but the illegal Chinese workers won’t be getting a minimum wage.
What?! Why not $50/hr?
Closed is closed, but at least you’ll sound really generous as you lock the doors for the last time.
The problem of paying for a hike in the hourly minimum wage is easily dealt with: just legislate a minimum hourly profit. It makes about as much sense economically and will ensure that the owner will get a raise in his hourly earnings too.
Who wants to be a Venezuelan millionaire?
This is what repeatedly happens in Australia. Very hard to make these sorts of businesses work with high wages.
Gov Newsom’s restaurant is excempt from the new law.
https://nypost.com/2024/04/04/us-news/gavin-newsoms-restaurant-offering-job-at-16-hr-despite-new-state-law-of-20-hr-for-fast-food-workers/
Gov Newsom’s restaurant is exempt from the new law.
https://nypost.com/2024/04/04/us-news/gavin-newsoms-restaurant-offering-job-at-16-hr-despite-new-state-law-of-20-hr-for-fast-food-workers/
$20 an hour would be $40,000 a year… I doubt anyone gets 40hrs a week though.
Cheapskates!
$10,000 an hour should be the minimum wage – then we could all live in big houses and drive fancy cars!
Screw that, make it $100 million an hour!!! We be kickin’ it Zimbabwe-style!
Hope you gazillionaires enjoy your $1,000 milkless coffee and nothing else with it!!! You’d better pray they have nuclear cars by then too, ’cause you won’t be able to afford petrol…
As per Petros’s comment above, eateries here in Australia are either cutting back on staff, unable to get or afford staff, or giving up entirely and closing down…
No no no, they will sell the coffee for what it is REALLY worth! $10,000,000 a cup, US!
“…the real minimum wage is actually zero.”
That is gold!
I believe that our beloved economist Thomas Sewell first came up with that.
And what about the poor schmucks that were already making $20/hour? Shouldn’t they expect a raise too? They had more skills and experience than the presumably new hires with none. Aren’t they worth more?
Well, exactly and those who supervise them need to make more than the people they supervise and on it goes. No matter how many times you explain this it still goes in one ear and out the other.
UK did without a minimum wage until Tony thought of it in 1998.
Aleksandr Solzhenitsyn has an apt description of minimum wage called “The Gulag Archipelago”.
Turd must have based his fabian Socialism on that and the soviet commissars.
The minimum is always the bottom. Zero is apparently even lower.