Shooting the Golden Goose
First the owner of Starbucks makes the biggest faux pas in the history of the brand, and now the city of Seattle is about to force a huge minimum wage hike onto restaurants. It seems economic suicide is all the rage in Seattle these days.
When you add in payroll burden (insurance, taxes, unemployment, training, etc.) it's well in excess of a 100% increase in total labor costs to business owners. They'll handle it the way businesses always handle this sort of leftist nonsense: they'll raise prices, among other things...
So they'll either replace the now overly-expensive low-skilled labor with robots or they'll simply demand the remaining low-skilled labor work twice as hard. That means you denizens of Seattle will soon be getting crappy service at higher prices! Win-win! Enjoy, Left-tards.
For an industry with a slim profit margin to start with, the wage hike could have a profound effect, even as supporters say it will benefit the economy in the long run.
The increase, up from $9.32 an hour, is set to be phased in starting April 1. The initial minimum wage will be $11 an hour. Employers with 500 or fewer workers must increase their pay to $15 an hour by January 2019. Larger employers, having 501 or more workers, have just two years to raise their worker compensation to $15.
When you add in payroll burden (insurance, taxes, unemployment, training, etc.) it's well in excess of a 100% increase in total labor costs to business owners. They'll handle it the way businesses always handle this sort of leftist nonsense: they'll raise prices, among other things...
With such a big wage hike, restaurant owners are looking for new ways to keep that profit. This means looking at raising prices, having fewer employees, using automated ordering systems, changing tipping models, and more, Anton said.
In a survey conducted in 2014 by the Washington Restaurant Association, the top four responses of what restaurants predict they would have to do were: raise prices, lay off employees, reduce employee hours or close their business entirely.
Anton predicts the Seattle restaurant industry may experiment heavily with the newer automated ordering systems as well, but it is still too early to tell what will ultimately work.
So they'll either replace the now overly-expensive low-skilled labor with robots or they'll simply demand the remaining low-skilled labor work twice as hard. That means you denizens of Seattle will soon be getting crappy service at higher prices! Win-win! Enjoy, Left-tards.
posted by Jar(egg)head at 16:58
1 Comments:
What Seattle and Washington state is doing is becoming Japan. Everything will come from a vending machine, or an Automat restaurant. The largest controllable cost in any business is labor. It used to be technology, but labor is the biggest controllable cost in any business. Every business needs a place to conduct its affairs, wether it be a large box store, or someone's garage, that business has to be conducted SOMEPLACE. Then there is the inventory, wether it be physical or intellectual, it still has to be something. You have to have inventory (IE: something to sell) or no one will come to your business. The last cost is labor. Someone, or something has to sell your inventory. Be it you or a third party (employees) You have to sell your inventory to make money. Due to regulations (unemployment insurance, Worker's comp, Medical insurance) and employees salary is on a fraction of the cost of that labor. So how do you control that, so that you can stay in business and put food on your table? You have to either demand more form fewer employees or automate.
A great example of this is Blockbuster and Redbox. Blockbuster stuck with the labor intensive box store model, while red box stuck vending machines all over and rented for a third of the cost. People gave up customer service and selection for price and convenience. Blockbuster was already feeling the squeeze from Netflix and other online stores, so they did th sonly thing they could do, cut labor. The employees had to do the work of two people and service suffered. people stopped going because why pay three times as much for a movie and have to wait in line, go during business hours, and interact with harried workers who saw their work load increase, yet pay stay the same. Blockbuster could have raised salaries, but then the cost of movies would have to go up. By the time they realized they needed to move into the automated market, they were so far in debt, they wen tout of business.
Automated check out with four registers watched over by one person is becoming the norm in grocery stores, and will soon be the norm in just about any large retail store. Fast food and restaurants will initially go to order kiosks, where you tap a computer screen and someone brings the food(Chili's has already done this and expect many to follow). That is one to two employees salaries saved in the long run by automation. The low income, entry level jobs will be replaced by machines and unemployment will go up. I can guarantee that Seattle workers will see a three to six month bump in salary before the effects of this "Fair" wage start to kick in, then expect a lot of automated stuff to appear and jobs to disappear, either that or businesses to disappear and be replaced with vending machines.
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