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If you're business is going under because you can't afford $15 an hour you should be shutting down anyway. A rule of thumb, 1/3 on wages, 1/3 on capital, 1/3 f

• JumpCrisscross 8y ago
  > 1/3 on wages, 1/3 on capital, 1/3 for everything else You're criticizing businesses for following your prescription. They were 1/3-1/3-1/3. Wages went up. Quantity of labor demanded is being reduced to compensate.
  • indecisive_user 8y ago
    Exactly. And restaurants already operate on very tight profit margins (~5%). If 1/3 of their cost went to labor in 2014 when the minimum wage was $10.74, the proportion will be much higher at a minimum wage of $15 in 2018. Sure they could raise prices, but you risk pricing customers out, and as the one restaurant owner discovered, customers will still spend the same amount by ordering less or cheaper items.
    • vilmosi 8y ago
      >>> Sure they could raise prices, but you risk pricing customers out, and as the one restaurant owner discovered, customers will still spend the same amount by ordering less or cheaper items. Wouldn't all their competitors face the same "problem"? So it wouldn't be a "problem" in the end?
      • RcouF1uZ4gsC 8y ago
        Eating at a restaurant is a luxury not a necessity. Thus, if all the restaurants in a certain area were more expensive than what they were comfortable with, people might eat out less in general.