‘Living Wages’ Can Cost Jobs

As minimum wages rise, employers who can't afford to pay higher wages for entry-level jobs will shutter their businesses.

By Rob Schwarzwalder Published on August 27, 2018

When I got my first job as a 16-year-old, I was paid $2.10 per hour. It was a union job in local grocery store.

Although we didn’t use boxes, we were called “box boys” in tribute to how customers once took their purchases home.

My friends and I worked like there was no tomorrow. We had jobs lots of other guys envied. But none of us ever planned to work at the Mayfair Market as a career. We never expected wages that would let us live independently, let alone support families.

Entry-level Job

Those were days when the term “entry-level job” had meaning. It was understood that doing manual labor that demanded little skill was not something meant to last.

Pushing a broom, stocking a shelf, or painting a storage closet was hard. But anyone with enough physical strength to perform these tasks could do them. They required almost no training, no native skill, no education. They were only the first rungs on a long upward ladder, rungs that could lead to something better.

In recent years, the cry for “living wage” entry-level jobs has gone far and wide. It’s resulted in a $15 per hour minimum wage from Seattle to Disneyland. In some places, that wage is going up gradually. But government-mandated minimum wage increases are on the rise.

Is It Working in Seattle?

How are they working? Consider Seattle, where local government has started treat business as an adversary to be crushed.

“The city of Seattle’s move to $15 an hour a few years ago resulted in many workers being provided with fewer hours, and experiencing a net loss in pay,” writes Brett Goldberg. “Companies simply had to adjust shifts and hours to account for the costs.”

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A study done by economists at the University of Washington (in the heart of Seattle) found, “The city’s escalating minimum wage has meant a slight increase in pay among workers earning up to $19 per hour, but the hours worked in such jobs have shrunk, a study commissioned by the city found. It estimates there would be 5,000 more such jobs without the Seattle law.”

Does the term “consequences” matter nothing to these all-knowing elites?

Job-Killing Policy

Consider this gem about the Bernie Sanders acolyte from the Bronx, “Democratic Socialist” Alexandria Ocasio-Cortez. According to Investor’s Business Daily, she “‘swung by’ to say goodbye to a restaurant where she used to work. What she didn’t say is that it is closing because the owners can’t afford New York City’s soon-to-be $15 minimum wage — the very job-killing policy Ocasio-Cortez and her fellow Democrats want to impose nationwide.”

The store’s owner said the main reason he’s closing the storied Coffee Shop in Union Square is that “the minimum wage is going up and we have a huge number of employees.”

A Living Wage

Advocates of a “living wage” claim compassion for low-income workers. What they really are implying, though, is that people in low-skill positions are too inept and unintelligent to make their way up the path to economic success. So, they have to be patronized by a government that will force those big meanies — i.e., their employers — to pay them more.

They also don’t seem to grasp the reason companies don’t pay people who don’t know much a big salary. Why? Because even if these people work very hard, and most do — they don’t know much. They have little to add to the value of the company in terms of productivity or innovation. Employers who hope to stay in business can only afford to pay them the value of their labor. And city government can dictate what that is.

Are such employees unimportant? No! They are vital to any successful enterprise. The next time you walk into a clean public restroom or are served on a clean plate, you can thank someone who’s paid a modest wage.

Something More

But these same people, if asked, would tell you almost universally they want something more. They don’t want to be stuck doing the same repetitive, boring, and unchallenging tasks decade upon decade. They want the chance to rise, to do better, to excel. Making it harder for businesses to keep them, or hire them in the first place, does them no favors.

It’s hard to advance when English is your second language and when you don’t have much education or skill training. That’s why so many companies are now paying talented employees to go to college or get advanced skill or management training.

But those benefits will wither away as leftist elites impose their vision of “justice” on more and more cities. This is not justice, and it is not compassion.

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