Small Businesses in NYC Struggling with $15 Minimum Wage

[Papageorgio]

Small Businesses Struggle With $15 Minimum Wage Hike in NY: 'They're Shutting Down'

EXCERPT: According to a report published Monday by the Wall Street Journal, many business leaders and owners in the Big Apple have said that they are having to cut hours, raise prices, and reduce staff in their businesses due to the rising labor costs that they say come from the recent city law bumping up the minimum wage. . . .

The president of the Queens Chamber of Commerce, Thomas Grech, told the Wall Street Journal that he has seen an increased number of small businesses closing in the last six to nine months. He believes the rising closures are due to the minimum wage legislation.

“They’re cutting their staff. They’re cutting their hours. They’re shutting down,” Grech said. “It’s not just the rent.”

Did you actually read the article you linked to?

One restaurant owner said:

While she has not had to reduce her staff, she has had to be more careful about overtime and pull back on some people’s shifts.

“What it really forces you to do is make sure that nobody works more than 40 hours,” Koteen said. “You can only cut back so many people before the service starts to suffer.”

You have to make sure nobody works more than 40 hours, so you don't have to pay overtime. Maybe she should hire a couple more people to ensure she doesn't get stuck with overtime.

And then there's this business owner:

Sarah McNally — who owns the local bookstore chain McNally Jackson Books, which employs 75 people at its four locations in New York City — said that there is “absolutely no benefit” to operating a retail business in the city, and is working to open two more stores to stay profitable.

She has not had to reduce hours or employment to deal with the pay increase, though.

McNally's complaint is that SHE'S not getting paid enough so she's opening two more stores to increase HER income. That should create close to 40 more jobs, so the OWNER can increase her income.

It's just awesome that people have to hire more people and let their existing workers have some sort of personal life after working 40 hours per week.

If you schedule employees for 32 hours a week, that would take care of the overtime. Pretty simple solutions for the employer.

 

[Thinker101]

It isn't just small businesses and it has nothing to do with the Minimum Wage.

Eventually common sense needs to break through your partisan wall.

If a company has X amount of money to spend on labor and the cost of that labor suddenly goes up without a corresponding rise in revenue then something has to give.

Higher pay labor creates more in demand and pays more in taxes.

Sure, it also creates fewer jobs which results in less taxes....get a clue.

We have 3.7 percent unemployment

And $15/hour is not the standard minimum wage...dumbass.

 

[rightwinger]

It isn't just small businesses and it has nothing to do with the Minimum Wage.

Eventually common sense needs to break through your partisan wall.

If a company has X amount of money to spend on labor and the cost of that labor suddenly goes up without a corresponding rise in revenue then something has to give.

Higher pay labor creates more in demand and pays more in taxes.

Sure, it also creates fewer jobs which results in less taxes....get a clue.

We have 3.7 percent unemployment

And $15/hour is not the standard minimum wage...dumbass.

Ya think?

Minimum wage workers are about 3 percent of the workforce. Cutting minimum wage workers will have minimal effect

If you own a business and want to sweep your own floors and clean your own toilets....you can

 

[Thinker101]

Eventually common sense needs to break through your partisan wall.

If a company has X amount of money to spend on labor and the cost of that labor suddenly goes up without a corresponding rise in revenue then something has to give.

Higher pay labor creates more in demand and pays more in taxes.

Sure, it also creates fewer jobs which results in less taxes....get a clue.

We have 3.7 percent unemployment

And $15/hour is not the standard minimum wage...dumbass.

Ya think?

Minimum wage workers are about 3 percent of the workforce. Cutting minimum wage workers will have minimal effect

If you own a business and want to sweep your own floors and clean your own toilets....you can

Sigh...logic and common sense certainly in not in your wheelhouse. About 42% of workers in the US make $15/hour or less.

 

[Redfish]

Eventually common sense needs to break through your partisan wall.

If a company has X amount of money to spend on labor and the cost of that labor suddenly goes up without a corresponding rise in revenue then something has to give.

Higher pay labor creates more in demand and pays more in taxes.

Sure, it also creates fewer jobs which results in less taxes....get a clue.

We have 3.7 percent unemployment

And $15/hour is not the standard minimum wage...dumbass.

Ya think?

Minimum wage workers are about 3 percent of the workforce. Cutting minimum wage workers will have minimal effect

If you own a business and want to sweep your own floors and clean your own toilets....you can

If they have to pay someone $15/hr to do it, then that may be their only choice if they want to stay in business.

the falacy here is that people are trying to support families on minimum wage jobs. Minimum wage is only paid to teens for summer work or for the most unskilled labor, very few fast food outlets are paying minimum wage. Here in NOLA the fast food places are advertising starting jobs at above minimum wage, some even with starting bonuses.

the whole minimum wage issue if a false canard created by the dems to get americans yelling at each other.

 

[Dekster]

It isn't just small businesses and it has nothing to do with the Minimum Wage.

Eventually common sense needs to break through your partisan wall.

If a company has X amount of money to spend on labor and the cost of that labor suddenly goes up without a corresponding rise in revenue then something has to give.

The problem is that companies have been increasing profits for the past 30 years, without increasing wages. Wages as a percentage of costs, have been steadily decreasing while profits have been steadily rising. Employers have managed to absorb increases in every other expense category - real estate, equipment, utilities, transportation and supplies, but have steadfastly resisted increases in wages, even as GDP rose. The excuse given was that productivity increases were due to automation, not worker performance.

Wages are now at the same level, as a percentage of costs, as they were in the Guilded Age, and that level of pay inequity, lead to the rise of the union movement in the USA. Reagan promised all American workers a raise when they got rid of the unions. The opposite happened. The American worker hasn't had a meaningful increase in pay since the union movement was destroyed by Republican policies and lies.

Republicans promised that W's tax cuts would trickle down to the workers, even though "trickle down" economics was discredited when Reagan was President. W's tax cut simply accelerated the transfer of wealth from othe middle class to the wealthy, while earned income credits were raised to compensate for a lack of wage increases.

Corporations were awash in cash BEFORE Trump cut taxes to the corporations. He promised that workers would get a $4000 raise from those corporate tax cuts, and that didn't happen. Instead a mere 5% got a one time bonus, and corporations launched the biggest stock buy-back in American history, increasing the equity value of their own shares, enriching their shareholders with no tax implications whatsoever, and giving their workers nothing.

So stop with the gloom and doom and tears for the corporate sector. Maybe those CEO's making $20 million per year on the backs of workers making minimum wage, can forego further increases to THEIR salaries for a while.

We went through the last 12 years telling low wage workers that we can’t increase wages because the economy is struggling

Now, with a booming economy and below 4 percent unemployment, we tell them we still can’t afford to raise our lowest wage.

If not now.......when is a good time to raise minimum wage?

Reagan told workers that Unions were preventing them from getting raises. Get rid of the unions and you'll get raises.

When W was President, the companies said yes, we've increased GDP, but that's not because of the workers, it's because of automation, and we have to pay for that equipment - no raises for you.

I worked in an industry that saw my productivity double and double again, because of automation, as we switched from electric typewriters to, during which time my income went up proportionally. When I retired as a law clerk, I was making more than three times what I was making when I started, and was receiving profit sharing bonuses from my employer. One lawyer I worked for saw his billings increase by more than 30% from the year before I started working for him, without him working longer hours, or pulling in any new clients. Damn skippy I deserved to benefit from that increase, and I did.

And now he could buy a computer program to do all that work you did. Some lawyers don't even need bricks and mortar offices any more it has become so specialized they can have a Virtual Office If you are a non-lawyer, profit sharing would be an ethics violation these days. Let's look at real estate law. I know someone who makes a mint as a lawyer sitting at home preparing documents for real estate transactions. He can pull the source documents for deeds/title exams off online subscription services and outsource anything additional he needs to independent abstractors; use OCR software to scan those docs, and crank out a deed in 10 minutes. All that is "overhead" and none of it is "labor" and the missing equation in that overhead is having a title examiner and a secretary. Add in a deed of trust/note is 5-10 more minutes. Gets his orders electronically; transmits the docs electronically. Does everything with a cell phone and internet. There goes the receptionist. That is what technology is doing to just that industry. I asked him how much he makes. He said he clears about 100 per deed and does 2K-3K of those and the other stuff varies wildly but he ends up with 3K-4K files per year.

My cousin's wife is bringing in about $60K a year off her online shops that she runs and fills the orders for besides the 2 days a week she works as a dental hygienist.

Traditional employees are becoming obsolete. Welcome to the 21st Century. If you want to make the money, you have to have an entrepreneurial side. Otherwise, your are at the mercy of the whims of others.

 

[Redfish]

Higher pay labor creates more in demand and pays more in taxes.

Sure, it also creates fewer jobs which results in less taxes....get a clue.

We have 3.7 percent unemployment

And $15/hour is not the standard minimum wage...dumbass.

Ya think?

Minimum wage workers are about 3 percent of the workforce. Cutting minimum wage workers will have minimal effect

If you own a business and want to sweep your own floors and clean your own toilets....you can

Sigh...logic and common sense certainly in not in your wheelhouse. About 42% of workers in the US make $15/hour or less.

remove the illegals from the workforce and see what supply and demand does to the starting wage.

 

[Dragonlady]

It isn't just small businesses and it has nothing to do with the Minimum Wage.

Eventually common sense needs to break through your partisan wall.

If a company has X amount of money to spend on labor and the cost of that labor suddenly goes up without a corresponding rise in revenue then something has to give.

Higher pay labor creates more in demand and pays more in taxes.

Sure, it also creates fewer jobs which results in less taxes....get a clue.

Every time the minimum wage has been increased, unemployment goes down, and the economy gets a huge boost. Poor people spend every dollar they get their hands on, so increasing their income increases their spending, which creates more jobs, and more spending!

When the minimum wage is increased, all low wage workers in the company get a raise, so the raise impacts more than just minimum wage workers.

 

[rightwinger]

Higher pay labor creates more in demand and pays more in taxes.

Sure, it also creates fewer jobs which results in less taxes....get a clue.

We have 3.7 percent unemployment

And $15/hour is not the standard minimum wage...dumbass.

Ya think?

Minimum wage workers are about 3 percent of the workforce. Cutting minimum wage workers will have minimal effect

If you own a business and want to sweep your own floors and clean your own toilets....you can

If they have to pay someone $15/hr to do it, then that may be their only choice if they want to stay in business.

the falacy here is that people are trying to support families on minimum wage jobs. Minimum wage is only paid to teens for summer work or for the most unskilled labor, very few fast food outlets are paying minimum wage. Here in NOLA the fast food places are advertising starting jobs at above minimum wage, some even with starting bonuses.

the whole minimum wage issue if a false canard created by the dems to get americans yelling at each other.

Minimum wage is paid to college students looking to pay for their education. Because the wage has been frozen for over a decade, college students must borrow money to make up the difference

 

[Redfish]

It isn't just small businesses and it has nothing to do with the Minimum Wage.

Eventually common sense needs to break through your partisan wall.

If a company has X amount of money to spend on labor and the cost of that labor suddenly goes up without a corresponding rise in revenue then something has to give.

Higher pay labor creates more in demand and pays more in taxes.

Sure, it also creates fewer jobs which results in less taxes....get a clue.

Every time the minimum wage has been increased, unemployment goes down, and the economy gets a huge boost. Poor people spend every dollar they get their hands on, so increasing their income increases their spending, which creates more jobs, and more spending!

When the minimum wage is increased, all low wage workers in the company get a raise, so the raise impacts more than just minimum wage workers.

you really need an econ 101 course. If the low income worker gets an increase, but the price of everything he buys goes up by the same % he has gained nothing, the economy has gained nothing except a wave of inflation.

Obozo's stimulus was just such a move, pump more money into the economy and the only thing that it did was raise prices of everything.

 

[Papageorgio]

Well that's shocking.

That it is.

Only a moron wouldn't see small businesses closing because of that ridiculous $15 dollar an hour minimum wage.

Minimum wage was never meant to support anyone. It was meant for high school kids to make a little cash at night and on summer vacation.

Only idiots would demand a $15 dollar an hour minimum wage. Prices will go up to cover it. Hours will be cut, workers let go and small businesses will just close.

Not to smart.

What they fail to understand is when an employer gives a dollar an hour raise, it costs the employer more than that dollar. Other things increase in cost as well, such as vacation time where you are getting paid to not work. Social Security and Medicare contributions since your employer has to match those contributions and you will be paying more into them. Insurances increase as well because if something happens to you like getting laid off or getting hurt on the job, the payout is based on how much you make per month.

When you take a huge pay increase like this, the employer has to take huge other losses on top of it.

What YOU fail to realize is that the small business owner can deduct ALL of those costs from their gross income and reduce their tax liability accordingly. Every dollar an employer spends on wages, only costs the business owner 78 cents because they would pay income tax of 22% on that additional profit, so the business owner is only out of pocket 78 cents, not one dollar.

On the other hand, earned income credits cost taxpayers $3 billion per year just for administration of this program. That's over and above the costs of the benefits paid to low income workers.

Earned Income Tax Credit: Small Benefits, Large Costs

By shifting the burden for employee wages back to the employer, the economy will save all of the costs of running this program, as well as the costs of the benefits paid. Employers are only paying 78 cents on the dollar for every dollar of wage increases they pay.

You're picking up the peanuts while being trampled by the elephants, Ray. The Waltons don't need more dividends, stop paying their workers for them.

According to the Bureau of Labor an employee that gets paid $9.15 an hour costs an employer $20.91 per hour. That is including taxes, benefits, physical work space, computers and other office equipment, insurance and other costs.

So, the isn't 78 cents on the dollar, that is a simplistic look at a more complex cost.

 

[Redfish]

Sure, it also creates fewer jobs which results in less taxes....get a clue.

We have 3.7 percent unemployment

And $15/hour is not the standard minimum wage...dumbass.

Ya think?

Minimum wage workers are about 3 percent of the workforce. Cutting minimum wage workers will have minimal effect

If you own a business and want to sweep your own floors and clean your own toilets....you can

If they have to pay someone $15/hr to do it, then that may be their only choice if they want to stay in business.

the falacy here is that people are trying to support families on minimum wage jobs. Minimum wage is only paid to teens for summer work or for the most unskilled labor, very few fast food outlets are paying minimum wage. Here in NOLA the fast food places are advertising starting jobs at above minimum wage, some even with starting bonuses.

the whole minimum wage issue if a false canard created by the dems to get americans yelling at each other.

Minimum wage is paid to college students looking to pay for their education. Because the wage has been frozen for over a decade, college students must borrow money to make up the difference

totally wrong, college students have to borrow money because the price of tuition has risen much faster than the overall rate of inflation, and that happened directly as a result of the government giving out unlimited student loans. the colleges took advantage of that stupidity and raised their tuition costs, and the losers were the kids who now are burdened with huge debts. But fear not, the dems want to transfer that debt to YOU and ME.

 

[Thinker101]

It isn't just small businesses and it has nothing to do with the Minimum Wage.

Eventually common sense needs to break through your partisan wall.

If a company has X amount of money to spend on labor and the cost of that labor suddenly goes up without a corresponding rise in revenue then something has to give.

Higher pay labor creates more in demand and pays more in taxes.

Sure, it also creates fewer jobs which results in less taxes....get a clue.

Every time the minimum wage has been increased, unemployment goes down, and the economy gets a huge boost. Poor people spend every dollar they get their hands on, so increasing their income increases their spending, which creates more jobs, and more spending!

When the minimum wage is increased, all low wage workers in the company get a raise, so the raise impacts more than just minimum wage workers.

Get back to us when minimum wage reaches $15/hour in Canada.

 

[rightwinger]

It isn't just small businesses and it has nothing to do with the Minimum Wage.

Eventually common sense needs to break through your partisan wall.

If a company has X amount of money to spend on labor and the cost of that labor suddenly goes up without a corresponding rise in revenue then something has to give.

Higher pay labor creates more in demand and pays more in taxes.

Sure, it also creates fewer jobs which results in less taxes....get a clue.

Every time the minimum wage has been increased, unemployment goes down, and the economy gets a huge boost. Poor people spend every dollar they get their hands on, so increasing their income increases their spending, which creates more jobs, and more spending!

When the minimum wage is increased, all low wage workers in the company get a raise, so the raise impacts more than just minimum wage workers.

you really need an econ 101 course. If the low income worker gets an increase, but the price of everything he buys goes up by the same % he has gained nothing, the economy has gained nothing except a wave of inflation.

Obozo's stimulus was just such a move, pump more money into the economy and the only thing that it did was raise prices of everything.

You need an economics lesson

The cost of labor is only a portion of operating costs. There will not be a dollar for dollar increase in inflation

Stop putting the state of our economy on the backs of our lowest paid workers

 

[Blaine Sweeter]

It isn't just small businesses and it has nothing to do with the Minimum Wage.

Uh, if you read the article, you'll find out that new minimum wage does have something to do with it. Have you read any of the zillion studies that document the harmful effects of an excessive minimum wage?

Wall Street Journal is a right-wing rag owned by Rupert Murdoch who is a friend of Donald Trump. I have been subscribing to it for ten years. When Obama was in office they might as well have renamed the Op-Ed section to "Why We Hate Obama, Continued".

They have some really good reporters who do their job on the markets but you'll NEVER see any article in there criticizing Trump.

So looking at the other side of the coin:

"Posted August 7, 2019

Report: After Five Years of Minimum Wage Increases, New York City’s Restaurant Industry Is Thriving"
Report: After Five Years of Minimum Wage Increases, New York City’s Restaurant Industry Is Thriving - National Employment Law Project

 

[Dragonlady]

Small Businesses Struggle With $15 Minimum Wage Hike in NY: 'They're Shutting Down'

EXCERPT: According to a report published Monday by the Wall Street Journal, many business leaders and owners in the Big Apple have said that they are having to cut hours, raise prices, and reduce staff in their businesses due to the rising labor costs that they say come from the recent city law bumping up the minimum wage. . . .

The president of the Queens Chamber of Commerce, Thomas Grech, told the Wall Street Journal that he has seen an increased number of small businesses closing in the last six to nine months. He believes the rising closures are due to the minimum wage legislation.

“They’re cutting their staff. They’re cutting their hours. They’re shutting down,” Grech said. “It’s not just the rent.”

Did you actually read the article you linked to?

One restaurant owner said:

While she has not had to reduce her staff, she has had to be more careful about overtime and pull back on some people’s shifts.

“What it really forces you to do is make sure that nobody works more than 40 hours,” Koteen said. “You can only cut back so many people before the service starts to suffer.”

You have to make sure nobody works more than 40 hours, so you don't have to pay overtime. Maybe she should hire a couple more people to ensure she doesn't get stuck with overtime.

And then there's this business owner:

Sarah McNally — who owns the local bookstore chain McNally Jackson Books, which employs 75 people at its four locations in New York City — said that there is “absolutely no benefit” to operating a retail business in the city, and is working to open two more stores to stay profitable.

She has not had to reduce hours or employment to deal with the pay increase, though.

McNally's complaint is that SHE'S not getting paid enough so she's opening two more stores to increase HER income. That should create close to 40 more jobs, so the OWNER can increase her income.

It's just awesome that people have to hire more people and let their existing workers have some sort of personal life after working 40 hours per week.

If you schedule employees for 32 hours a week, that would take care of the overtime. Pretty simple solutions for the employer.

You could schedule for 38 hours per week to ensure you don't go over. Then hire 2 more people to work 38 hour weeks to make up the shortfall, thus creating 2 new jobs, without increasing your costs.

Note that the bookstore owner is opting to open two more stores to increase HER income, because the wage increase is coming out of HER income directly. She's going to rent two locations, hire someone to make renovations and improvements, buy fixtures and equipment, and hire somewhere close to 20 more full time workers per store!!! Instead of sitting back on her huge profits, she's being forced to invest that money in the economy and create jobs to maintain her cushy lifetstyle.

How is this not a win for working Americans?

 

[rightwinger]

We have 3.7 percent unemployment

And $15/hour is not the standard minimum wage...dumbass.

Ya think?

Minimum wage workers are about 3 percent of the workforce. Cutting minimum wage workers will have minimal effect

If you own a business and want to sweep your own floors and clean your own toilets....you can

If they have to pay someone $15/hr to do it, then that may be their only choice if they want to stay in business.

the falacy here is that people are trying to support families on minimum wage jobs. Minimum wage is only paid to teens for summer work or for the most unskilled labor, very few fast food outlets are paying minimum wage. Here in NOLA the fast food places are advertising starting jobs at above minimum wage, some even with starting bonuses.

the whole minimum wage issue if a false canard created by the dems to get americans yelling at each other.

Minimum wage is paid to college students looking to pay for their education. Because the wage has been frozen for over a decade, college students must borrow money to make up the difference

totally wrong, college students have to borrow money because the price of tuition has risen much faster than the overall rate of inflation, and that happened directly as a result of the government giving out unlimited student loans. the colleges took advantage of that stupidity and raised their tuition costs, and the losers were the kids who now are burdened with huge debts. But fear not, the dems want to transfer that debt to YOU and ME.

Cost of everything has gone up.

I worked minimum wage at $2.10 an hour in the early 70s. I could buy seven gallons of gas for an hours wage. Today you get about 2 1/2 gallons

I could buy a new car for a half a years minimum wage salary. Now it would take you a full year

I could take a date to the movies for an hours wage. Today it would take you 2 1/2 hours pay

 

[SAYIT]

Funny but right down the street at Wall Street they are still screaming for lower interest rates. Seems odd that we condemn the lowest rung for wanting to step up but we never condemn those at the top for still wanting more.

Opposing WashDC meddling in what is clearly a state authority - minimum wage - is not condemning "the lowest rung for wanting to step up." People do and have always had the right to expand and improve their education and skill set in order to step up.

A WashDC imposed one-size-fits-all edict is not the solution in a free-market economy. What is best for those in New York may not work for those in New Mexico.

 

[Wry Catcher]

Higher pay labor creates more in demand and pays more in taxes.

Sure, it also creates fewer jobs which results in less taxes....get a clue.

We have 3.7 percent unemployment

And $15/hour is not the standard minimum wage...dumbass.

Ya think?

Minimum wage workers are about 3 percent of the workforce. Cutting minimum wage workers will have minimal effect

If you own a business and want to sweep your own floors and clean your own toilets....you can

Sigh...logic and common sense certainly in not in your wheelhouse. About 42% of workers in the US make $15/hour or less.

After paying for shelter, food, clothing, transportation, insurance (health care in particular), taxes and fees, $15 dollars and hour is slavery***.

The future is bleak, for when a charismatic leader organizes the vast majority of the 42%, a General Strike is in our future. The systemic problem is a product of greed coupled with a callous disregard for those who struggle to make ends meet.

Socialism did not create the chaos in Venezuela, corruption by the power elite's and political leader's fiscally irresponsible behavior and personal greed have done so.

***SAYIT's comment in the post above is an example of callous conservatism, total disregard for the problems of the working poor, and blaming them as if they are all lazy and irresponsible.

 

[Thinker101]

And $15/hour is not the standard minimum wage...dumbass.

Ya think?

Minimum wage workers are about 3 percent of the workforce. Cutting minimum wage workers will have minimal effect

If you own a business and want to sweep your own floors and clean your own toilets....you can

If they have to pay someone $15/hr to do it, then that may be their only choice if they want to stay in business.

the falacy here is that people are trying to support families on minimum wage jobs. Minimum wage is only paid to teens for summer work or for the most unskilled labor, very few fast food outlets are paying minimum wage. Here in NOLA the fast food places are advertising starting jobs at above minimum wage, some even with starting bonuses.

the whole minimum wage issue if a false canard created by the dems to get americans yelling at each other.

Minimum wage is paid to college students looking to pay for their education. Because the wage has been frozen for over a decade, college students must borrow money to make up the difference

totally wrong, college students have to borrow money because the price of tuition has risen much faster than the overall rate of inflation, and that happened directly as a result of the government giving out unlimited student loans. the colleges took advantage of that stupidity and raised their tuition costs, and the losers were the kids who now are burdened with huge debts. But fear not, the dems want to transfer that debt to YOU and ME.

Cost of everything has gone up.

I worked minimum wage at $2.10 an hour in the early 70s. I could buy seven gallons of gas for an hours wage. Today you get about 2 1/2 gallons

I could buy a new car for a half a years minimum wage salary. Now it would take you a full year

I could take a date to the movies for an hours wage. Today it would take you 2 1/2 hours pay

So WTF are you suggesting, minimum wage should be based on gas prices/new car prices/movie prices?