Nearly a decade ago, when voters in Washington approved a measure that would give the state’s lowest-paid workers a raise nearly every year, many business leaders predicted that small towns on this side of the state line would suffer.
But instead of shriveling up, small-business owners in Washington say they have prospered far beyond their expectations. In fact, as a significant increase in the national minimum wage heads toward law, businesses here at the dividing line between two economies — a real-life laboratory for the debate — have found that raising prices to compensate for higher wages does not necessarily lead to losses in jobs and profits.
Idaho teenagers cross the state line to work in fast-food restaurants in Washington, where the minimum wage is 54 percent higher. That has forced businesses in Idaho to raise their wages to compete.
With Washington stealing their workforce, Idaho business are entering a new kind of competition. Instead of competing for customers by lowering prices, goods quality and services, they're competing for employees by raising wages.
Hmmm... I wonder if all the Idaho kids that are working in Washington also spend some of their money there?
And this is great:
Mr. Fazzari employs 42 people at his pizza parlor. New workers make the Washington minimum, $7.93 an hour, but veteran employees make more. To compensate for the required annual increase in the minimum wage, Mr. Fazzari said he raises prices slightly. But he said most customers barely notice.
He sells more pizza, he said, because he has a better product, and because his customers are loyal.
Emphasis mine.
I bet his employees are more loyal than the average as well.
What ever happened to the days when people were loyal to their employers because they were afraid that if they weren't they wouldn't be able to find as good a job as they had somewhere else? What ever happened to the days when you could work in the same place all your life and count on your boss to take your needs, your family, your kids into consideration when making decisions about whether or not to cut expenses in the form of cutting jobs?
And by the way...
“Are you kidding? There are so many jobs nearby that pay way more than minimum wage,” said Jennifer Stadtfeldt, who is 17 and lives in Coeur d’Alene, which is just a few minutes from Washington. She pointed out that Taco Bell, McDonald’s and other fast-food outlets in her town were posting signs trying to entice entry-level workers with a starting pay of $7 an hour.
...if McDonald's is doing it, you know it's profitable.
This, though, is my favorite part.
But other business groups argue that an increase would hurt consumers and workers at the low end.
If you raise the minimum wage, you'll hurt poor poeple because prices will have to go up to compensate.
Hmmm... Raise the minimum wage so that people at the lowest end of the spectrum are making more money and... people at the lowest end of the spectrum will be harmed. Does that seem... odd? If it resulted in lost jobs, that would play, but the rest of the article says that's unlikely. If the argument is just that they'll have to pay more for goods, well, won't they have more money to pay with? At worst it'd be a wash. Raise the prices for goods to offset the costs of higher wages and you could say that people are just paying back what they're getting over the long haul, except for the fact that this isn't a closed economy that only caters to people who make minimum wage. Other people with higher wages can be counted on to take up some of the slack of the higher prices, which, again, means that the lowest end is benefited by the increase. Not harmed.
No comments:
Post a Comment