A new study indicates that “a 30% rise in the minimum wage means that 1 million people lose either their jobs or even the opportunity to work.” [Tim Worstall, James Pethokoukis] This and all other studies should be taken with caution, of course: “[We’ve] been talking about [it] confidently, as if we know for sure what will happen when these laws take effect. In fact, it’s very hard to study what happens when we raise the minimum wage.” [Megan McArdle] David Henderson on sneakily pro-union Los Angeles hotel minimum wage enactment [EconLib] Donald Boudreaux corrects The Guardian [Cafe Hayek] And Borderlands Books in San Francisco, threatened with closure after the city’s electorate voted in a minimum wage increase, may survive if it can get enough fans and customers to cover some of its costs in a sponsorship plan.
Don’t believe minimum wage hikes hurt real people? After March 31, a famed sci-fi bookstore on Valencia St. in San Francisco’s Mission District will no longer be able to cater to your taste in fantasy:
The change in minimum wage will mean our payroll will increase roughly 39%. That increase will in turn bring up our total operating expenses by 18%. To make up for that expense, we would need to increase our sales by a minimum of 20%. We do not believe that is a realistic possibility for a bookstore in San Francisco at this time.
And this, which speaks for itself:
In November, San Francisco voters overwhelmingly passed a measure that will increase the minimum wage within the city to $15 per hour by 2018. Although all of us at Borderlands support the concept of a living wage in [principle] and we believe that it’s possible that the new law will be good for San Francisco — Borderlands Books as it exists is not a financially viable business if subject to that minimum wage. Consequently we will be closing our doors no later than March 31st. The cafe will continue to operate until at least the end of this year.
Early reactions from customers online run heavily to two themes: 1) anguish that a beloved cultural institution is passing from the scene and 2) reflections that they, the fans and customers, had supported the minimum wage hike too when it was on the ballot. (It might restrict businesses’ rights, but who cares about that?) But in this world — as in so many of the well-crafted alternative worlds of science fiction — the link between actions and their logical consequences, foreseen and intended or otherwise, is not to be broken. [Reprinted from my post at Cato at Liberty]
Coyote read the letter in recognition:
I found the language here familiar because I spent most of last year writing such letters to angry customer bases. In our case, fortunately, we had the ability to raise prices so the letters were to defuse customer irritation rather than to announce a closure.
And Mark Perry at AEI identifies why a bookstore in particular cannot adjust the way a restaurant or a dry cleaner might:
There’s a limit to how much a bookstore can increase book prices to offset higher labor costs because the publisher sets the list price of the book and it’s printed on the book cover.
Meanwhile, in Philadelphia, a new minimum wage law hits nonprofits, which ask for more taxpayer money so they can comply [Inquirer]
- Obama wants Hill to force paid leave on employers. What, his rule-by-decree powers didn’t stretch that far? [RCP, USA Today] Department of Labor, using funds taxed from supporters and opponents alike, happy to act as frank advocate for legislation [its blog]
- Employers brace for salaried-overtime mandate, wrought by unilateral Obama decree [KSL, earlier at Cato]
- Related: “Employers To Face More Litigation In 2015 As Plaintiff Lawyers Swoop In” [Daniel Fisher on Gerald Maatman/Seyfarth Shaw report] Here come more NLRB decisions too [Tim Devaney, The Hill]
- Krugman on minimum wage: two economists in one! [Donald Boudreaux, Cafe Hayek via Coyote, @Mike_Saltsman (“Min wage in France is closer to $12/hr US. But Krugman still being inconsistent bc he’s also backed $15 US minimum”)]
- Five pro-de Blasio unions — SEIU/1199, teachers, hotel workers, doormen/building staff, CWA District 1 — help enforce NYC mayor’s agenda [NYDN]
- Testimony: “worst-kept secret” in Philly ironworkers’ union was that you could get ahead through violent “night work” [Philadelphia Inquirer; earlier on Quaker meetinghouse arson here and here, related here]
- Loads of new compliance burdens: “Changes in California Employment Law for 2015″ [Baker Hostetler] And it wouldn’t be California without many more employer mandates pending in legislature [Steven Greenhut]
- Senate Republicans make noises about reining in runaway EEOC [Roger Clegg, Senate minority staff report, Human Resource Executive Online]
- Yes, minimum wage increases hurt many low-skilled workers [NBER via Charles Hughes]
- “Women earn less than men even when they set the pay” [Emma Jacobs, FT, via Tyler Cowen]
- Just a typical fast food worker, except for happening to have a high-powered P.R. firm representing him [Diana Furchtgott-Roth, Economics21]
- Aaargh: “Federal judge wants to bury summary judgment for many reasons, but especially because it harms employment-discrimination plaintiffs” [CL&P]
- “Ideally, someone from Human Resources will join you to meet with the aggrieved employee and inform her that the tree is staying up.” (Well, not up this far into January, but you know.) [Evil Skippy at Work]
- “But”, sic: “Vermont has some of the most progressive wage-and-hour laws in the country, but low-income workers are still struggling.” [Alana Semuels, National Journal]
The Chamber of Commerce is calling attention to its ten favorites for the year [via Bainbridge, list can be found there]. Eight of the ten may ring a bell with those who have followed our coverage (goblin-toppler, helmet toss, undecillion dollars, man saved from drowning sues rescuers, California ADA serial filer, falls after seeing “Dexter” ad on subway, caught sleeping on camera at Yankees game, claims “Frozen” based on own life story), while two are new to us:
Organized trial lawyers usually don’t make minimum wage increases a top priority, but they may do so in order to deprive incoming GOP Gov. Bruce Rauner of leverage he might use to extract liability reform. [Rich Miller, Crain’s Chicago Business]
- I’m quoted dissenting from the seeming ENDA consensus [Caroline Preston, Al Jazeera America; earlier here and here; related, Mark Lee, Washington Blade last year, “ENDA and the Seduction of Symbolic Gestures”]
- EEOC gears up to fight employer wellness programs under ADA [Stephen Miller/SHRM, ABA Journal, John Holmquist/Michigan Employment Law Connection, Robin Shea/Employment and Labor Insider]
- Evidence still points to disemployment effects for low-skilled workers from minimum wage hikes [David Neumark et al NBER working paper via Ira Stoll, related] What’s the right minimum wage? As the NYT correctly perceived in 1987, $0.00. [David Henderson video, Prager]
- “Judge Calls Out NLRB Pro-Union Partisanship” [Labor Pains; document demands levied by agency against Univ. of Pittsburgh Medical Center]
- If you so much as think of declaring me fit for work, my lawyer will make you rue the day [Coyote on employer role in Social Security Disability]
- New Cato research brief, “Labor Market Fluidity and Economic Performance” [Stephen J. Davis and John Haltiwanger]
- Philly councilman wants to reserve city subsidies for unionized hotels [Joel Mathis, Philadelphia mag]
Volunteers serve in National Parks around the country without ever being paid for their labor.
Why does the government encourage people to labor without pay for some activities and not others? …
We think that volunteering is noble, rewarding and educational independent of whether the cause is “for profit” or not.
Our issue is not with volunteering.
The issue is what right does the government have in saying where a free citizen of this country can donate his or her time and efforts to?
If you have a friend who is starting a business and you want to help him succeed, why can’t you volunteer your time, efforts and expertise? If a neighbor wants to build and extension onto their offices and you donate a set of architectural or engineering plans because that is your area of expertise. what right does the government have to say “you can’t do that?” If you design web pages and do some work on a web page for a fellow parishioner at your church, what concern is that of the government? How many small businesses have “friends” who donate time to repair or maintain the business’ computers?
The bottom line is the application of the labor of a person is the individual’s choice – not the government’s.
P.S. Small though it was, Westover “produce[d] the greatest variety of ports in the United States,” reports Baylen Linnekin. More from Darleen Click at Protein Wisdom. And in our comments section a reader identifying himself as William Smyth, owner of Westover Winery, comments here.
- Latest NLRB jaw-dropper: ban on retaliation against “concerted” labor action extends to employee acting alone in self-interest [Fresh & Easy case; Hackman/Barley, Vorys, Ian Gabriel Nanos/Management Memo]
- Connecticut Law Tribune assails workplace arbitration, and in so doing reveals lawyerly prejudices [Schwartz]
- Religious-discrimination complaint to EEOC demands reinstatement of newspaper editor out of step with views of paper’s owner [Romenesko]
- Unfair to reveal to customers costs of policy they may favor? [WCCO; Coyote, who relatedly is disrespectful to Paul Krugman] “Why is there such a difference of opinion on the employment effects of a minimum wage increase?” [Pierre Lemieux, Cato Regulation magazine, PDF]
- “NLRB goes rogue against small business” [Rick Manning, The Hill]
- Among biggest legal headaches of telecommuting for employers: wage-and-hour law implications [Joseph Leonoro, Steptoe & Johnson]
- Canada: “Farmers’ Kids are ‘Underage Labor’ and Must Stop Working” [Lenore Skenazy]