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Seems like an oversimplification to me. If the owners could simply raise prices by 20% and suffer no economic consequences, I have little doubt they would. Thus

Seems like an oversimplification to me. If the owners could simply raise prices by 20% and suffer no economic consequences, I have little doubt they would. Thus, I can only surmise that it is not as simple as that.

handmodel 5y ago
The article says about 5% of workers quit each month. If you raise pay by 20% - then maybe this goes down to 3%? I'm not sure - it obviously doesn't eliminate the problem entirely and either creates the problem of having to raise prices or get by with less staff. I think people on HN may be forgetting the restaurant industry does not have the same margins as tech ... and close to no one working these jobs (on the employee side) is ever hoping to stay there for decades.
jlarocco 5y ago
Then maybe restaurants aren't a viable business? I know it sounds crazy because we've had them for so long, but maybe it's not sustainable to have so many of them? In any case, this seems like a great area to let the market figure it out. If restaurants go out of business the owners and employees will find something else to do.
- Andrex 5y ago
  > In any case, this seems like a great area to let the market figure it out. If restaurants go out of business the owners and employees will find something else to do. I'm not sure more corporate concentration would be a better situation.
  - jlarocco 5y ago
    I don't think my comment implies more corporate concentration. And even if it does, why should restaurants be held to a higher standard than other sectors? It's fine for Google and Facebook to buy up everything, but restaurants can't consolidate?
  - huehehue 5y ago
    Your tone is quasi-facetious, but you do not realize that Taco Bell was the only restaurant to survive the Franchise Wars, so...now all restaurants are Taco Bell.
  - deleted 5y ago
    [deleted]
- asdfasgasdgasdg 5y ago
  I do think that if it's persistently difficult to find workers for non-distortionary reasons, prices will likely increase gradually with whatever attendant effects there are from that.
deleted 5y ago
[deleted]
Aunche 5y ago
Owners most likely can raise prices 20% right now, but there's no guarantee that restaurant demand will continue to be so high. When demand falls, people will still remember the inflated prices and may choose to not eat there even if prices fall back down again.
munificent 5y ago
> If the owners could simply raise prices by 20% and suffer no economic consequences, I have little doubt they would. If all the restaurants did at the same time, they could. But if only some do, then the restaurants that underpay their workers will have lower prices and outcompete them out of business. You can look at this an yet another example of the core problem where consumers don't have visibility into the externalities of the purchasing choices. When picking a restaurant, you see the food prices, but you don't see that one restaurant is more expensive because it treats its workers better. That's an encapsulated abstraction. So we choose based on price, which inadvertently incentivizes restaurants to treat employees like crap.

handmodel 5y ago

The article says about 5% of workers quit each month. If you raise pay by 20% - then maybe this goes down to 3%? I'm not sure - it obviously doesn't eliminate the problem entirely and either creates the problem of having to raise prices or get by with less staff. I think people on HN may be forgetting the restaurant industry does not have the same margins as tech ... and close to no one working these jobs (on the employee side) is ever hoping to stay there for decades.

jlarocco 5y ago

Then maybe restaurants aren't a viable business? I know it sounds crazy because we've had them for so long, but maybe it's not sustainable to have so many of them? In any case, this seems like a great area to let the market figure it out. If restaurants go out of business the owners and employees will find something else to do.

Andrex 5y ago
> In any case, this seems like a great area to let the market figure it out. If restaurants go out of business the owners and employees will find something else to do. I'm not sure more corporate concentration would be a better situation.
- jlarocco 5y ago
  I don't think my comment implies more corporate concentration. And even if it does, why should restaurants be held to a higher standard than other sectors? It's fine for Google and Facebook to buy up everything, but restaurants can't consolidate?
- huehehue 5y ago
  Your tone is quasi-facetious, but you do not realize that Taco Bell was the only restaurant to survive the Franchise Wars, so...now all restaurants are Taco Bell.
- deleted 5y ago
  [deleted]
asdfasgasdgasdg 5y ago
I do think that if it's persistently difficult to find workers for non-distortionary reasons, prices will likely increase gradually with whatever attendant effects there are from that.

deleted 5y ago

[deleted]

Aunche 5y ago

Owners most likely can raise prices 20% right now, but there's no guarantee that restaurant demand will continue to be so high. When demand falls, people will still remember the inflated prices and may choose to not eat there even if prices fall back down again.

munificent 5y ago

> If the owners could simply raise prices by 20% and suffer no economic consequences, I have little doubt they would. If all the restaurants did at the same time, they could. But if only some do, then the restaurants that underpay their workers will have lower prices and outcompete them out of business. You can look at this an yet another example of the core problem where consumers don't have visibility into the externalities of the purchasing choices. When picking a restaurant, you see the food prices, but you don't see that one restaurant is more expensive because it treats its workers better. That's an encapsulated abstraction. So we choose based on price, which inadvertently incentivizes restaurants to treat employees like crap.