Issues

Face the Consequences

New website documents the struggles of business owners to cope with wage hikes

AP

Minimum wage hikes adopted across the country will have numerous unintended consequences for those they are trying to help, according to a new website documenting the human cost of wage mandates.

The Employment Policies Institute, a think tank in Washington D.C., that opposes minimum wage hikes, has started a new website allowing small business owners to share their stories about the impact of the wage hike. Facesof15.com features numerous stories of local and family-run businesses that have been forced to lay off workers or close their doors altogether as a result of the $15 hourly wage passed in San Francisco, Oakland, and Seattle.

"Unions and activists say the costs of minimum wage hikes are negligible. But the real faces of $15—and of other dramatic hikes in the minimum wage—are the employers who struggle to offset those costs," the site says. "Their actions often mean fewer opportunities for the employees these laws are meant to help."

EPI has aggregated news stories across the Bay Area and beyond detailing the plight of businesses struggling to survive as labor costs skyrocket. It collected 15 profiles of companies that have done everything from cut staff to raise prices to accommodate the new laws.

Visitors will find the story of Abbots Cellar, a celebrated San Francisco eatery that was forced to close its doors for good as the city began raising wages before eventually hitting $15 hourly in 2017. Seattle’s Ivar’s Salmon House will raise prices 21 percent and discourage tipping to deal with costs, according to the Seattle Times.

Oakland’s Booth Memorial Child Development Center, a Salvation Army-sponsored daycare service serving primarily lower income families, will also suffer.

"If the Salvation Army can’t scrounge up that [money to cover the wage hike] by writing grants and finding donors, it might have to cut some of its 63 child care slots," a blurb from the San Francisco Chronicle says on the Faces of 15 website.

"The advocacy groups and ‘academics’ who claim with a straight face that these policies are nearly cost-free should explain their reasoning to the businesses struggling to adapt to these new mandates," EPI research director Michael Saltsman said.

Saltsman said the website was designed to counter the existing political and media narrative that raising wages through government mandates will have negligible costs on businesses and the economy at large.

Telling the human side of the consequences of such hikes is more persuasive than repeatedly pointing to a Congressional Budget Office report that found a $10.10 national minimum wage could eliminate as many as 1 million jobs, according to Saltsman.

"Rhetoric is meeting reality in the Bay Area, as small businesses are forced to make tough choices to adapt to much higher minimum wages. These stories do what empirical studies cannot, putting a human face on the unintended consequences of this public policy,"he said.