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As anyone who's ever done simple math knows
Mr. Perfect
Member, Moderator Posts: 66,437 ******
Min wage hikes = ungood
https://mises.org/blog/restaurants-eliminate-more-waiters-response-minimum-wage-hike
Restaurants to Eliminate More Waiters in Response to Minimum Wage Hike
83 Comments
Tags Big GovernmentU.S. Economy
01/03/2017Ryan McMaken
Colorado was among the four states where voters approved a minimum wage hike in November. Among the specific provisions for the new wage hike was the stipulation that tipped workers - such as waiters who receive tips and are paid below the standard minimum wage - will receive a mandated wage hike of 99 cents.
RELATED: "Four States Vote to Punish Low-Skilled Workers With Minimum Wage Hikes"
Naturally, this will lead to an increase in costs for restaurant owners who will then seek to raise prices and/or reduce costs. KDVR in Denver reports:
Kanatzer owns The Airplane Restaurant in Colorado Springs and said he has already increased his kids menu prices. ...
"I increased it a dollar - my kids menu prices went from $4.99 to $5.99," Kanatzer said.
Raising prices can only go so far, however. Contrary to what many non-economists seem to believe, it is not possible to simply "pass on the extra cost to customers." As any economics-major undergraduate knows, it is only possible to pass on a portion of the increased cost to the customer because higher prices and competition from other firms will lead to fewer sales if the owner simply attempts to "pass on the cost." And even if all restaurants are subject to the same wage hike, there are always substitutes in the form of take-out and other types of dining.
Specifically, in response to the forced wage hike we can expect to see more food-service business go the way of so-called "fast casual dining" which include brands such as Chipotle and Noodles and Company. These are restaurants where patrons order food at the counter, and then take their food to their tables themselves. These places often offer alcoholic beverages and higher-quality food than "fast food" places such as McDonalds, and somewhat approximate the "casual dining" experience at lower cost thanks to the elimination of servers.
Thus, in order to control costs, restaurants that have in past hired wait staff will become more like fast casual restaurants. The KDVR report suggests exactly this, in fact:
Kanatzer estimates most restaurants will adjust prices and change staffing levels as a result, which could mean fewer servers and longer waits.
"I've got a friend who has a restaurant and he's going to do counter service from 2-4 (p.m.) so he's not going to have a server at all," Kanatzer said.
...Kanatzer suspects more restaurants will install kiosks at tables in the hopes technology might eliminate the need for most servers.
So, we should expect restaurants to hire fewer servers and move toward more counter service and use of technology to replace servers.
Some waiters have become concerned that the new wage hike is endangering their jobs. They should be concerned:
Even some servers who are recipients of the pay raise fear possible impacts.
"I'm more worried about [the restaurant owner] and how it might affect him - not how it impacts me," said Lisa Bowen, a server at The Airplane Restaurant.
The effect on workers will be that many of them will need to move to lower-wage jobs due to there being fewer waiter opportunities. Many people who are now waiters and potential waiters will have to take jobs as cashiers and other workers at fast food and fast casual restaurants instead of waiting tables. As anyone who has worked in food service knows, these sorts of jobs often pay far less per hour than traditional waiter jobs. So, the minimum wage hike will mean an actual pay cut for many people who could have made more as waiters, were it not for the minimum wage hike.
Moreover, it means that in the future, waiter positions that might have existed in the absence of the minimum wage hike will never exist. More restaurants that rely on a large wait staff will change their model, close down, or never be opened at all, further cutting the job opportunities for workers who would benefit from working as waiters.
However, these unseen positions that never came into existence will not show up in any unemployment data, and thus the proponents of minimum wage hikes will claim that higher wages to not lead to less employment. The media will interview the lucky waiters who managed to keep their jobs and wait tables in an environment of higher prices - and higher tips. Competition for these remaining jobs will become more fierce meaning lower-skill waiters will find themselves locked out of waiter jobs. In the end, proponents of minimum wage hikes will declare victory and ignore all the unseen consequences imposed on the most vulnerable, unskilled, and marginal members of the workforce.
For more, see:
No, There's No Economic Case for the Minimum Wage
The Minimum Wage: Taking Away the Right to Work
A Nationwide Minimum Wage Is Even Worse than State-Imposed Wages
Note: The views expressed on Mises.org are not necessarily those of the Mises Institute.
Image source: Roger Jones www.flickr.com/photos/rogerjones/
https://mises.org/blog/restaurants-eliminate-more-waiters-response-minimum-wage-hike
Restaurants to Eliminate More Waiters in Response to Minimum Wage Hike
83 Comments
Tags Big GovernmentU.S. Economy
01/03/2017Ryan McMaken
Colorado was among the four states where voters approved a minimum wage hike in November. Among the specific provisions for the new wage hike was the stipulation that tipped workers - such as waiters who receive tips and are paid below the standard minimum wage - will receive a mandated wage hike of 99 cents.
RELATED: "Four States Vote to Punish Low-Skilled Workers With Minimum Wage Hikes"
Naturally, this will lead to an increase in costs for restaurant owners who will then seek to raise prices and/or reduce costs. KDVR in Denver reports:
Kanatzer owns The Airplane Restaurant in Colorado Springs and said he has already increased his kids menu prices. ...
"I increased it a dollar - my kids menu prices went from $4.99 to $5.99," Kanatzer said.
Raising prices can only go so far, however. Contrary to what many non-economists seem to believe, it is not possible to simply "pass on the extra cost to customers." As any economics-major undergraduate knows, it is only possible to pass on a portion of the increased cost to the customer because higher prices and competition from other firms will lead to fewer sales if the owner simply attempts to "pass on the cost." And even if all restaurants are subject to the same wage hike, there are always substitutes in the form of take-out and other types of dining.
Specifically, in response to the forced wage hike we can expect to see more food-service business go the way of so-called "fast casual dining" which include brands such as Chipotle and Noodles and Company. These are restaurants where patrons order food at the counter, and then take their food to their tables themselves. These places often offer alcoholic beverages and higher-quality food than "fast food" places such as McDonalds, and somewhat approximate the "casual dining" experience at lower cost thanks to the elimination of servers.
Thus, in order to control costs, restaurants that have in past hired wait staff will become more like fast casual restaurants. The KDVR report suggests exactly this, in fact:
Kanatzer estimates most restaurants will adjust prices and change staffing levels as a result, which could mean fewer servers and longer waits.
"I've got a friend who has a restaurant and he's going to do counter service from 2-4 (p.m.) so he's not going to have a server at all," Kanatzer said.
...Kanatzer suspects more restaurants will install kiosks at tables in the hopes technology might eliminate the need for most servers.
So, we should expect restaurants to hire fewer servers and move toward more counter service and use of technology to replace servers.
Some waiters have become concerned that the new wage hike is endangering their jobs. They should be concerned:
Even some servers who are recipients of the pay raise fear possible impacts.
"I'm more worried about [the restaurant owner] and how it might affect him - not how it impacts me," said Lisa Bowen, a server at The Airplane Restaurant.
The effect on workers will be that many of them will need to move to lower-wage jobs due to there being fewer waiter opportunities. Many people who are now waiters and potential waiters will have to take jobs as cashiers and other workers at fast food and fast casual restaurants instead of waiting tables. As anyone who has worked in food service knows, these sorts of jobs often pay far less per hour than traditional waiter jobs. So, the minimum wage hike will mean an actual pay cut for many people who could have made more as waiters, were it not for the minimum wage hike.
Moreover, it means that in the future, waiter positions that might have existed in the absence of the minimum wage hike will never exist. More restaurants that rely on a large wait staff will change their model, close down, or never be opened at all, further cutting the job opportunities for workers who would benefit from working as waiters.
However, these unseen positions that never came into existence will not show up in any unemployment data, and thus the proponents of minimum wage hikes will claim that higher wages to not lead to less employment. The media will interview the lucky waiters who managed to keep their jobs and wait tables in an environment of higher prices - and higher tips. Competition for these remaining jobs will become more fierce meaning lower-skill waiters will find themselves locked out of waiter jobs. In the end, proponents of minimum wage hikes will declare victory and ignore all the unseen consequences imposed on the most vulnerable, unskilled, and marginal members of the workforce.
For more, see:
No, There's No Economic Case for the Minimum Wage
The Minimum Wage: Taking Away the Right to Work
A Nationwide Minimum Wage Is Even Worse than State-Imposed Wages
Note: The views expressed on Mises.org are not necessarily those of the Mises Institute.
Image source: Roger Jones www.flickr.com/photos/rogerjones/
Some will die in hot pursuit
And fiery auto crashes
Some will die in hot pursuit
While sifting through my ashes
Some will fall in love with life
And drink it from a fountain
That is pouring like an avalanche
Coming down the mountain
And fiery auto crashes
Some will die in hot pursuit
While sifting through my ashes
Some will fall in love with life
And drink it from a fountain
That is pouring like an avalanche
Coming down the mountain
Comments
The attention paid to an old man by sweet young things vieing for a tip is not to be lightly disregarded. (especially one sees no other friendly faces)
Take away my little waitresses and you leave me no reason to patronize your establishment. I can buy a hotdog at faschek!
The attention paid to an old man by sweet young things vieing for a tip is not to be lightly thrown away.
(do not upset the kitchen staff though!). [xx(]
That right there is even further gas on the fire. I just don't understand the push for a higher min. wage. AT ALL.
I mean, is there any logic in this?
http://www.oregonlive.com/opinion/index.ssf/2015/12/the_economic_case_for_a_15_min.html
Points to anyone that can find more than 15 fallacies.
And fiery auto crashes
Some will die in hot pursuit
While sifting through my ashes
Some will fall in love with life
And drink it from a fountain
That is pouring like an avalanche
Coming down the mountain
IN SC tipped workers can be paid 2.13 and hour.
I mean really? That means the customer is morally encouraged to pay the ridiculous .20% no matter what rule and effectively subsidize the staff.
I want to tip based on performance exceeding standard expectations.
I expect you to bring me my hamburger, knowing I like horseradish and bringing it without being asked, and/or being extremely friendly and helpful deserves a tip.
Business people deal in the empirical, while the same can't be said about economists.
Anytime there is a price increase whether it be labor, regulatory, or taxes, the ripple is immediately felt in the business sector. Countermeasures always mean prices are going up.
Such is almost impossible to explain to the low information crowd and min wage increases always hurt the people it was intended to help the most.
If you are visiting Hawaii, and go thru the drive thru at your favorite fast food place, the voice on the speaker that says "May I take your order?" is not in Hawaii. Labor costs are too high. Broadband connection back to the mainland US is cheaper.
Been in Sheetz here on the mainland and ordered a sandwich? Touch screen ordering. There is no one taking your order- no one getting paid for taking your order- at any wage.
Aldi grocery store- no one is paid to run all over the parking lot corralling the shopping carts. Want a cart? Stick a quarter in the slot to unlock it, get your quarter back when you put the cart back.
Sorry, but minimum wage jobs are frequently minimum skill/ minimum experience jobs. Mandate a cost greater than the worth, businesses WILL find alternatives. There ain't no such thing as a free lunch.
why do you think they been teaching common core math ?
Hell at 58 I had to go back to school to get another Skill set. Most of the Jobs I used to normally do moved out of state.
The CEO of the Hardee's / Carls Jr. is developing robots to replace the whole kitchen. They may have a few folks feeding and cleaning and repairing the robots. Those people will need to have some skills that will warrant $15 an hour. That burger flipping robot will be amortized as a 7yr asset (if I had to guess) I'll have to talk to my BIL, he's in Restaurant sales.
So what happens with all of the non skilled un employed workers whose job has been replaced with ever increasing automation? They still need to eat. I see this becoming a major problem in the next decade.
So what happens with all of the non skilled un employed workers whose job has been replaced with ever increasing automation? They still need to eat. I see this becoming a major problem in the next decade.
That's a great question.
It is a difficult question made worse by the libs giving away the house since LBJ.
quote:Originally posted by CaptFun
The CEO of the Hardee's / Carls Jr. is developing robots to replace the whole kitchen. They may have a few folks feeding and cleaning and repairing the robots. Those people will need to have some skills that will warrant $15 an hour. That burger flipping robot will be amortized as a 7yr asset (if I had to guess) I'll have to talk to my BIL, he's in Restaurant sales.
So what happens with all of the non skilled un employed workers whose job has been replaced with ever increasing automation? They still need to eat. I see this becoming a major problem in the next decade.
The "Major Problem" {your words} is because the costs to place a man on the payroll eclipses the actual wages or salary the worker takes home in many cases, especially jobs involving manual labor.
Over the years labor laws have forced employers to: Pay unemployment insurance, pay workman's comp insurance, pay half of Social Security and Medicare, pay for employees healthcare, Family Medical Leave Act, pay sick days, and in some states pay for pregnancy leave, childcare, mandatory days off, ADA accommodation even though there are no disabled on the pay roll, OSHA, NIOSH and other compliance mandates.
GOVERNMENT is the greatest destroyer of jobs in the private sector. GOVERNMENT itself has necessitated the demand for robotics.
quote:Originally posted by redneckandy
So what happens with all of the non skilled un employed workers whose job has been replaced with ever increasing automation? They still need to eat. I see this becoming a major problem in the next decade.
That's a great question.
It is a difficult question made worse by the libs giving away the house since LBJ.
Free stipend for life to be a philosopher,artist or writer.[:D]
The Venus Project https://www.thevenusproject.com/ after The Georgia Guide Stones http://thesecrettruthabout.com/the-georgia-guidestones/
Wake up WW III is coming. Wake Up!
serf
quote: As anyone who's ever done simple math knows
why do you think they been teaching common core math ?
You make an excellent point.
And fiery auto crashes
Some will die in hot pursuit
While sifting through my ashes
Some will fall in love with life
And drink it from a fountain
That is pouring like an avalanche
Coming down the mountain
Quality service and products will always sell for a premium price.
When McDonald's gets too high or automated. I will go to a place like Tom's for a little more money and I will tip the waitress. For cheep food I will take peanut butter and jelly sandwiches on the road or liverwurst. I will not pay some tatood drug head with green hair and a ring in his nose who can't count change $7.00 for a cardboard sandwich and $2.50 for a 12oz root beer.
However Mcdonalds will always be a good place to pee when on the road and the coffee is pretty good.
There is a Service station in Hubbard Oregon where someone pumps your gas, washes your windows,airs your tires and checks your oil. The owners name is Tom McCain. His station does more business than any other in the area. His gas cost more but people prefer to go there. He also has the best full service small burger joint on the whole state of Oregon. It operates on the same principal. Everybody love Tom.
Quality service and products will always sell for a premium price.
When McDonald's gets too high or automated. I will go to a place like Tom's for a little more money and I will tip the waitress. For cheep food I will take peanut butter and jelly sandwiches on the road or liverwurst. I will not pay some tatood drug head with green hair and a ring in his nose who can't count change $7.00 for a cardboard sandwich and $2.50 for a 12oz root beer.
However Mcdonalds will always be a good place to pee when on the road and the coffee is pretty good.
1st isn't all Oregon full Service.[8D] But I will say None will chack your air or oil unless you ask Know a few who will but do not trust the guys that would be doing it.
The Best Burger Joint in Oregon Is Dougs and it to is attached to a Gas Station.
^^^^This is how the left thinks^^^^^^^. They think with there emotions....and there *..
quote:Originally posted by redneckandy
quote:Originally posted by CaptFun
The CEO of the Hardee's / Carls Jr. is developing robots to replace the whole kitchen. They may have a few folks feeding and cleaning and repairing the robots. Those people will need to have some skills that will warrant $15 an hour. That burger flipping robot will be amortized as a 7yr asset (if I had to guess) I'll have to talk to my BIL, he's in Restaurant sales.
So what happens with all of the non skilled un employed workers whose job has been replaced with ever increasing automation? They still need to eat. I see this becoming a major problem in the next decade.
The "Major Problem" {your words} is because the costs to place a man on the payroll eclipses the actual wages or salary the worker takes home in many cases, especially jobs involving manual labor.
Over the years labor laws have forced employers to: Pay unemployment insurance, pay workman's comp insurance, pay half of Social Security and Medicare, pay for employees healthcare, Family Medical Leave Act, pay sick days, and in some states pay for pregnancy leave, childcare, mandatory days off, ADA accommodation even though there are no disabled on the pay roll, OSHA, NIOSH and other compliance mandates.
GOVERNMENT is the greatest destroyer of jobs in the private sector. GOVERNMENT itself has necessitated the demand for robotics.
That's one way to look at it. Here is the way I see it. Which way will make me more money? Hiring ten farm hands to operate ten mule teams to plow twenty acres a day or hiring one farm hand with a Big John Deere tractor that can plow 200 acres a day? (I don't row crop so the numbers are a guess but you get the idea.)
Why in the world would I want all of those employees with their added costs (insurance, OSHA, ect.) when there is a better option available??
CAPITALISM pushes technology not Government regulations.
Basic manual labor is going the way of the mule team, if you need any more proof look at any automobile assembly line.
quote:Originally posted by CaptFun
quote:Originally posted by redneckandy
So what happens with all of the non skilled un employed workers whose job has been replaced with ever increasing automation? They still need to eat. I see this becoming a major problem in the next decade.
That's a great question.
It is a difficult question made worse by the libs giving away the house since LBJ.
Free stipend for life to be a philosopher,artist or writer.[:D]
The Venus Project https://www.thevenusproject.com/ after The Georgia Guide Stones http://thesecrettruthabout.com/the-georgia-guidestones/
Wake up WW III is coming. Wake Up!
That's great but where does the money come from? The taxes on the unemployed? Or out of thin air as debt that will never be paid?
If it comes to WWIII as a means to population control I fear it will make WWI and WWII look like beach parties.
quote: As anyone who's ever done simple math knows
why do you think they been teaching common core math ?
[;)][;)][V][V]
There are chain shops, franchises & burger joints that are staffed by the "sanctuarians", who never heard of food safety, cross-contamination, hand washing or speaking English. The "food" is prepared by comparing the picture on the menu to what winds up on the plate. Many times, a simple Reuben sangwitch is conglomerated into a rare pork slice bathed in vinegar & noodles, served with potato chips (made of plantains).
The "best" part is that it only cost $8.50.
Statewide, out of 100 new food joints; 88 will close down in the first year. 10 of the remainder will stay open 2 years or less.
All a rising min wage does is the same thing the (d)s have done for years; create a strawman argument to mobilize the low information crowd, motivate the gullible to actively seek "justice", screw the ones that can afford their "help" the least, then "move on" to something else.
quote:Originally posted by jim_lemay
Invoking BS on the study results!!
But wait !
What about all the ice wagon drivers, gas station attendants, and buggy whip makers ???
"It's just business."
"The strong will survive."
Your argument is off track. There will always be a need for food and technology will not replace that need, it will eliminate or greatly reduce the number of people required to meet the need. The businesses will survive, the idiots thinking they are overworked and underpaid for their entry level jobs may not.
quote:Originally posted by us55840
When wages go up including raising the minimum wage, prices go up to more than make up the increase. So that $1.00 item increases to $1.50 or more.
As for waitresses being paid below minimum wage my thought is they wouldn't be if they didn't work for below minimum wage.
I'd like to see the minimum wage eliminated entirely. In short order, places that won't or can't afford to pay the amount a person will work for, wouldn't be in business.
[:0]
Not quite true. The are many small towns where jobs are few and there are no other alternatives than to be working for a person who puts their own profits above what is just compensation.
That's been the case for a very long time.
So your answer is to have Government step in and make it fair, how quaint.
The reason Government wants higher minimum wages is they get a bigger hunk of money in taxes. Wages go up so do the taxes the government gets. It makes it a nice bait and switch game. Government FORCES employers to pay more, government gets more taxes from not only the worker but the business too. A nice legal way to take more to feed the insatiable glut of governments.
If you feel some worker is underpaid in a private business, open a competing business next door and hire their workers away for better wages.
quote:Originally posted by us55840
When wages go up including raising the minimum wage, prices go up to more than make up the increase. So that $1.00 item increases to $1.50 or more.
As for waitresses being paid below minimum wage my thought is they wouldn't be if they didn't work for below minimum wage.
I'd like to see the minimum wage eliminated entirely. In short order, places that won't or can't afford to pay the amount a person will work for, wouldn't be in business.
[:0]
Not quite true. The are many small towns where jobs are few and there are no other alternatives than to be working for a person who puts their own profits above what is just compensation.
Tert
That's been the case for a very long time.
Lol, just compensation. Isn't that what the free market would determine?
quote:Originally posted by cnsay
quote:Originally posted by Barzillia
quote:Originally posted by jim_lemay
Invoking BS on the study results!!
But wait !
What about all the ice wagon drivers, gas station attendants, and buggy whip makers ???
"It's just business."
"The strong will survive."
Your argument is off track. There will always be a need for food and technology will not replace that need, it will eliminate or greatly reduce the number of people required to meet the need. The businesses will survive, the idiots thinking they are overworked and underpaid for their entry level jobs may not.
Don't know why my post is off track, then.
Because the three examples you sighted were done in by technology making them unneeded and not by companies greed. There is some use for gas station attendants in states they are mandated, but without givenment intervention they would be gone also. But if you can not see how refrigeration and the invention of the automobile caused the need for the other two to go away, where as automation will not cause the need for food and places to eat to go away. It will cause the need for entry level workers to staff the food industry to go away.
Because the three examples you sighted were done in by technology making them unneeded and not by companies greed. There is some use for gas station attendants in states they are mandated, but without givenment intervention they would be gone also. But if you can not see how refrigeration and the invention of the automobile caused the need for the other two to go away, where as automation will not cause the need for food and places to eat to go away. It will cause the need for entry level workers to staff the food industry to go away.
There are still people delivering ice and there are still people that make buggy whips but the only place you will find a Gas Station "Attendant" are places like Jersey and Oregon where it is mandated by law (and I would rather drive to the next state to get fuel than let them pump my fuel)
quote:Originally posted by Barzillia
quote:Originally posted by us55840
When wages go up including raising the minimum wage, prices go up to more than make up the increase. So that $1.00 item increases to $1.50 or more.
As for waitresses being paid below minimum wage my thought is they wouldn't be if they didn't work for below minimum wage.
I'd like to see the minimum wage eliminated entirely. In short order, places that won't or can't afford to pay the amount a person will work for, wouldn't be in business.
[:0]
Not quite true. The are many small towns where jobs are few and there are no other alternatives than to be working for a person who puts their own profits above what is just compensation.
Tert
That's been the case for a very long time.
Lol, just compensation. Isn't that what the free market would determine?
Hey Barz, will you give a shot at clarification on the previous question I asked?
Why do you even bother posting that crap? Trolling?
KC