A mark of irrationality is the refusal to conform one’s belief and behavior according to compelling evidence.
I’m reminded of my faux-socialist friend erstwhile Stephanie’s immortal words, uttered in a fit of frustration when I proffered evidence contrary to her stance:
“I’ve made up my mind! Don’t confuse me with facts!”
Democrats champion mandatory minimum-wage hikes in the name of “social justice” and the well being of minimum-wage workers, against the market forces of supply and demand. In so doing, they ignore that pesky thing — empirical evidence that minimum-wage hikes actually hurt minimum-wage workers because employers inevitably resort to cost-cutting measures by firing those same minimum-wage workers.
The latest example is the casual-dining Red Robin chain restaurants.
The New York Post reports that as minimum wage hikes hit across the country this year, restaurant busboys, hoping for a bigger paycheck, are instead losing their jobs as chains look to cut costs.
One chain axing jobs is Colorado-based Red Robin, located mostly in Western states where the minimum wage has risen more quickly.
On Jan. 8, 2018, Red Robin announced it hopes to save about $8 million this year by eliminating busboys at each of its 570 restaurants. Citing labor cost (i.e., minimal wage) increases, Red Robin’s chief financial officer Guy Constant told attendees at the ICR retail conference in New York, “We need to do that to address the labor increases we’ve seen.”
Remaining staff are expected to pick up the slack once the busboys are eliminated. Restaurant consultant John Gordon points out that while costs will definitely be pared, the problem with slashing busboy jobs is that it cuts into customer service.
Michael Saltsman, director of the Employment Policies Institute (EPI), told FOX Business:
“I read that as minimum wage. Somebody like Red Robin, which has a lot of exposure in western states [where the minimum wage is rising faster] … this is sort of a burger and beer chain. If they can’t pass those increases off in higher prices … they have to find a way to do more with less. I think the loss, as the minimum wage goes up … [is the] hollowing out of entry-level opportunities.”
851Franchise.com editor-in-chief Nick Powills observed:
“From a business standpoint, [Red Robin made a] very smart move. From an employee standpoint, you just cut out $8 million worth of labor. The interesting thing about the minimum wage hike is that those that made the decisions to do it, did it on behalf of the employee … when intentions are good, and you can’t appease everybody, someone is going to eventually be on the short [end of the] stick.”
Last year, Red Robin already eliminated “expediters” — restaurant employees who take the food from the cooks and place it on plates for the servers — resulting in a cost savings of nearly $10 million.
According to the Daily Wire, a study conducted by EPI, analyzing employment trends from 1990 through 2017, found that each 10% increase in the minimum wage in California has resulted in a corresponding 2% decline in employment for affected employees. The impact was larger, 5%, for lower-paid workers.”
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