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*UNEXPECTEDLY* — NYC Restaurants Cut Staff and Worker Hours Due to New $15 Minimum Wage

*UNEXPECTEDLY* — NYC Restaurants Cut Staff and Worker Hours Due to New $15 Minimum Wage

“We lost control of our largest controllable expense”

https://youtu.be/bEJrbEP-GtY

A new law in New York City which took effect at the start of the year, requires businesses with eleven or more employees to pay them a minimum of $15 an hour. It’s not working out too well for restaurants.

Chalk this up to good intentions and unintended consequences.

Megan Cerullo of CBS News reports:

NYC restaurants cutting staff hours as minimum wage hits $15

The legal minimum wage for New York City employers with 11 or more workers rose more than 15 percent on Dec. 31, 2018, to $15 per hour from $13, giving fast-food, retail and other employees a bump in pay. But some New York City restaurant owners say the latest minimum wage hike is forcing them to cut workers’ hours just to stay afloat.

It’s the third rise in the city’s base wage since Dec. 31, 2016, when it went to $11 an hour. The latest increase is part of a plan that phases in minimum wage hikes across New York state, with amounts and effective dates varying by region and industry. It’s not just a New York phenomenon, however: Minimum wages rose in 20 states with the new year, forcing businesses across the country to grapple with higher payrolls — and compete for workers with giants like Amazon that are already offering $15 an hour.

Jon Bloostein operates six New York City restaurants that employ between 50 and 110 people each. The owner of Heartland Brewery and Houston Hall, Bloostein said the effect of the higher minimum wage on payroll across locations represents “an immense cost” to his business.

“We lost control of our largest controllable expense,” he told CBS MoneyWatch. “So in order to live with that and stay in business, we’re cutting hours.”

Bloostein said he has scaled back on employee hours and no longer uses hosts and hostesses during lunch on light traffic days. Customers instead are greeted with a sign that reads, “Kindly select a table.” He also staggers employees’ start times. “These fewer hours add up to a lot of money in restaurants,” he said.

Bloostein said he has increased menu prices, too.

This is what happens when professional activists and legislators, many of whom have never owned or operated a business, make decisions for job creators.

Speaking of jobs, do you think this situation will result in more entry level jobs or less?

Cerullo continues:

Susannah Koteen, who opened Lido Restaurant in Harlem in 2011, said she has already started combining jobs to reduce workers’ hours. She relies on servers to bus their own tables, eliminating one of the lowest-paying customer-facing jobs.

She explained her rationale: “A server can bus their own table, but you can’t ask a busboy to open a bottle of wine and talk about what it can be paired with,” she said.

Koteen said she’s loath to cut these kinds of positions in a community she cares about and from which she has in the past promoted low-wage workers to management positions. “Our current general manager started as a busser the day we opened. English is not his first language, he has his GED. He is smart, hardworking and cares about customer service.”

If only someone had predicted this sort of thing:

The ink on the new law in New York is barely dry, but some people want to keep going.

Ginia Bellafante writes at the New York Times:

The $15 Minimum Wage Is Here. Why We Need $33 an Hour.

On Jan. 1, the new minimum wage, set at $15 an hour, went into effect in New York City, and most companies employing more than 10 people have to pay it. The increase, considered a crucial step in the fight against poverty, is the result of a hard-fought grass-roots organizing effort begun seven years ago and championed as a great victory by liberal politicians, even those who were initially not liberal enough to embrace it. But how much will the new standard do to alleviate some of the most punishing aspects of the city’s affordability crisis?…

You begin to understand some of the animosity directed at Amazon around its impending move to Queens, for example, when you see how much money is actually required to live there already, before housing prices are destined to be driven up even further by the company’s expansion. A single parent with two school-age children, for example would need to make nearly $69,427 a year, according to City Harvest’s Self-Sufficiency calculator. That amounts to an hourly wage of just under $33.

Why stop at $33? Why not go for $100?

Featured image via YouTube.

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Comments

Leftists politicians need to get ahead of the curve and tax robots just like any other employee including federal, state, and local inclome tax, FICA, Medicare, unemployment insurance, Obamacare, 401K, and Pension. /S

“This is what happens when professional activists and legislators, many of whom have never owned or operated a business, make decisions for job creators.”

Or, more broadly, this is what happens when you have “planners” dicking around with market economics, like Duh Donald.

It NEVER goes well, except for special interests (read cronies). Regular people just get chewed up in the predicted and predictable results. Every. Time.

    ooddballz in reply to Ragspierre. | January 19, 2019 at 12:13 pm

    Well rags, a cut in taxes was essentially a pay raise, and yet no one got laid off or fired for THAT little bit of planning.

      Ragspierre in reply to ooddballz. | January 19, 2019 at 2:52 pm

      No. It was not. You don’t understand what you’re trying to opine about.

      Leaving people with more of their income is NOT “a pay raise”. You can easily test this by testing the demand curve consequences of the tax cut. Employers won’t hire more workers at the market rate just because the workers are paying a marginally lower tax rate.

      This is even MORE true if you factor in a coercive “minimum wage”.

      The obverse is ALSO true. Employers won’t cut their employee demand merely because the employee is allowed to keep more of their earnings.

      Now, where you COULD have made a point is WRT the employer being left with more of their income (still not a “pay raise”), allowing for expansion, innovation, and all the other things that markets provide when they are allowed to work.

    RedEchos in reply to Ragspierre. | January 19, 2019 at 4:04 pm

    Are you seriously conflating lower taxes/less regulation with increasing the minimum wage?

    AND then saying Trump policies and NYC policies are similar?

    You really do have TDS…

    Serious question: is there one thing Trump has done that you thought was a good thing?

      Ragspierre in reply to RedEchos. | January 19, 2019 at 4:48 pm

      “Are you seriously conflating lower taxes/less regulation with increasing the minimum wage?”

      No. Stupid question.

      “AND then saying Trump policies and NYC policies are similar?”

      In the sense they are both Progressive BIG GOVERNMENT policies, sure. You’d have to understand what I doubt you can to appreciate that.

      You may have missed that a major provision of the now tweaked new and wonderful NAFTA is a minimum wage for auto and parts makers.

      “Serious question: is there one thing Trump has done that you thought was a good thing?”

      Sure. As I’ve said.

      What has Duh Donald done that you’ve opposed here?

        RedEchos in reply to Ragspierre. | January 20, 2019 at 7:06 pm

        “Are you seriously conflating lower taxes/less regulation with increasing the minimum wage?”

        No. Stupid question.

        ———————————–
        Yes you did.

        “Or, more broadly, this is what happens when you have “planners” dicking around with market economics”

        Trump is not ‘planning’ the economy, he is reducing government interference. NYC just interfered big-time in the restaurant biz with predictable results.

        ———————————–
        “AND then saying Trump policies and NYC policies are similar?”

        In the sense they are both Progressive BIG GOVERNMENT policies, sure. You’d have to understand what I doubt you can to appreciate that.

        Lower taxes/less regulation is a “Progressive BIG GOVERNMENT policy”? Since when? And thank you for the back-handed insult.

        ———————————–
        You may have missed that a major provision of the now tweaked new and wonderful NAFTA is a minimum wage for auto and parts makers.

        As for the USMCA the minimum wage is for Mexican factories. Don’t pretend that you don’t understand how wage differentials between countries affect the economy. Making a company (not country) pay all workers a comparable wage to the local economy regardless of country is a fair-trade practice.

        Sundance, whom I believe you despise, has done a very comprehensive rundown of NAFTA and the ‘poison pill’ of backdoor trading.
        ———————————–

        “Serious question: is there one thing Trump has done that you thought was a good thing?”

        Sure. As I’ve said.

        You call him a collectivist thug often, it’s one of your favorites. As I don’t lurk here just to read your comments perhaps you will show kindness and enlighten me. I haven’t read anything by you but, as I said, I don’t search-out your posts.
        ———————————–

        What has Duh Donald done that you’ve opposed here?

        Here? I mostly lurk. I do not like the fact that he hasn’t shut DACA down, I don’t like the fact we do not have a wall yet, and I don’t like the fact that he hasn’t done a review of all previous EO’s.

        Oh, and a couple of tweets made me cringe, much like reading a few of your ‘trolley off the rails’ posts. You’re not stupid, but TDS is creeping up on you. You insult people who have not insulted you and that makes your posts hard to read. You cannot admit you were wrong about Trump (so far) and you like to insult him in a post that has nothing to do with him (NYC minimum wage).

          Ragspierre in reply to RedEchos. | January 20, 2019 at 10:50 pm

          “Are you seriously conflating lower taxes/less regulation with increasing the minimum wage?”

          No. Stupid question.

          ———————————–
          Yes you did.

          That’s a lie.

          And you are too dim and ill-informed to even deal with.

          RedEchos in reply to RedEchos. | January 21, 2019 at 1:13 am

          I love your debate style. “Insult and run”

          No wonder people don’t much care for you. And no, it certainly is not because you are proving anyone wrong.

          Ragspierre in reply to RedEchos. | January 21, 2019 at 8:43 am

          I’m not debating you. Your aren’t honest, informed, or intelligent enough to bother with.

          You can’t even think logically. You think that imposing a minimum wage on the US, Canada, and Mexico is sound economics, but imposing one on NY state is bad. That is irrational.

          It’s ALLLLLLLLL bad, and it’s ALLLLLLLLLL Collectivist central planning by people who love statism.

          RedEchos in reply to RedEchos. | January 21, 2019 at 11:09 pm

          I’m not debating you. Your aren’t honest, informed, or intelligent enough to bother with.

          You can’t even think logically. You think that imposing a minimum wage on the US, Canada, and Mexico is sound economics, but imposing one on NY state is bad. That is irrational.

          It’s ALLLLLLLLL bad, and it’s ALLLLLLLLLL Collectivist central planning by people who love statism.

          ——————————-
          No, having a US company pay comparable wages to what was collectively bargained is not collectivist (and I say that as someone who thinks unions are now more evil than good). Maybe I’m wrong, maybe I’m not, but I’d be willing to listen instead of just throwing insults.

          As for misinformed, you are the one who thinks lowering taxes and cutting regulations is a hallmark of PROGRESSIVE governments.

          Or did you forget this little gem: “In the sense they are both Progressive BIG GOVERNMENT policies, sure.”

          RedEchos in reply to RedEchos. | January 22, 2019 at 8:31 pm

          ———————————–
          Me:“AND then saying Trump policies and NYC policies are similar?”

          You: In the sense they are both Progressive BIG GOVERNMENT policies, sure.
          ———————-

          Me:“As for misinformed, you are the one who thinks lowering taxes and cutting regulations is a hallmark of PROGRESSIVE governments.”

          You:That’s an idiot lie, and you are a liar. Which is why you aren’t worth messing with.

          ——————–

          Trump is pushing for lower taxes/less regulation and that is a “Progressive BIG GOVERNMENT policy”? Why, that’s just what China, Cuba, Venezuela, and the USSR did.

          Just say you misspoke or it was a typo or whatever. It’s all out in front of everyone.

          Ragspierre in reply to RedEchos. | January 22, 2019 at 9:08 pm

          Anyone who can read can see you’ve taken two completely different statements out of context to from a stupid lie.

          I’ll just call you Buzzfeed from now on.

          RedEchos in reply to RedEchos. | January 23, 2019 at 12:48 pm

          Me:“AND then saying Trump policies and NYC policies are similar?”

          You: In the sense they are both Progressive BIG GOVERNMENT policies, sure.

          ———————

          Trump is cutting regulations. NYC is adding regulation.

          And they are BOTH “Progressive BIG GOVERNMENT policies”?

          Wow. And you have the chutzpah to insult other peoples intelligence. Now I’m sorry I gave you the benefit of the doubt.

    JusticeDelivered in reply to Ragspierre. | January 19, 2019 at 5:42 pm

    Duh Rags-Rump, You know, but keep forgetting, Trump has more business experience, is smarter, wealthier and more powerful than R-Rump. Reality can be tough.

      Ragspierre in reply to JusticeDelivered. | January 19, 2019 at 8:46 pm

      You have no evidence for the first two assertions. Joe Biden is also wealthier and more powerful that I am.

      I wouldn’t be Joe Biden. Or you.

    RedEchos in reply to Ragspierre. | January 20, 2019 at 7:08 pm

    Or, more broadly, this is what happens when you have “planners” dicking around with market economics, like Duh Donald.

    It NEVER goes well, except for special interests (read cronies). Regular people just get chewed up in the predicted and predictable results. Every. Time.
    ———————————————————

    Explain how lower taxes (more of my own money staying in my pocket) and fewer regulations (more jobs = fewer employees = increased competition to get those employees) is comparable to raising the minimum wage (more regulation = fewer employees)

“Chalk this up to good intentions and unintended consequences.”

Professional socialists do not have good intentions and these consequences are fully expected and deemed acceptable. Collateral damage is the word the military uses for this sort of expected outcome.

When reality doesn’t match liberal expectations, liberals assume that someone, somewhere is doing something immoral.

Rather than repeal the minimum wage so more people can have jobs, they’ll demonize employers and increase welfare benefits (with borrowed money, because there’s an infinite pot of money to finance everything they want to do)

Who could have predicted this? Other than anyone with at least an IQ of 80, that is

Excellent advice you should avail yourself of.

You show that you have nothing but rank insults.

pretty common knowledge that you can’t get something for nothing and now, in new york and elsewhere, nothing costs you $15 an hour–minimum skills, minimum dedication, minimum commitment to the business’ success costs you $15 an hour–no thanks–other than critical employees, everybody else can work on commission or work somewhere else

The true minimum wage is the same everywhere. That wage is, by definition, zero.

Liberals just refuse to learn basic arithmetic.

    Arithmatic has nothing to do with it:

    stablesort | January 19, 2019 at 10:38 am

    “Chalk this up to good intentions and unintended consequences.”

    Professional socialists do not have good intentions and these consequences are fully expected and deemed acceptable. Collateral damage is the word the military uses for this sort of expected outcome.

The first American minimum-wage laws were intended to keep certain people out of the job market by making them too expensive to employ. These workers were attractive to employers because of their willingness to work for a bit less than more comfortable types—in other words, conventional free market dynamics. Nothing that couldn’t be countered at the stroke of a legislative pen.

    sonofsvengali in reply to tom_swift. | January 19, 2019 at 2:20 pm

    Does that same theory apply to immigration laws?

      Yes, it does. Historically the main purpose of immigration restrictions has been as a big government manipulation of the labor market to protect the price of domestic producers. In other words, they have filled the same role as tariffs. For extreme examples see the Chinese Exclusion laws in the USA, and the White Australia policy. Which is why they have historically been championed by the labor movement and opposed by true liberals, i.e. conservatives.

Actually, the free market decided wgaes, before the days of government minimum wage laws.

Businesses always try to reduce overhead. One way to do that is by offering low wages. If they can get competent workers to accept those wages, then the business can prosper. If they can not, then the business founders and sinks. The advantage, that employers have in a free market, is that some workers will always work for less money than others. That is why worker organizations [unions] developed, to present a united worker front on wage and hour demands. In other words, the market adjusted itself. Government became involved when violence was used by both sides as a negotiating tool.

However, government overstepped its bounds when it, essentially, took it upon itself to impose workers’ benefits standards upon businesses. In the case of direct employer-employee wage relations, employers were free to take the action which they felt necessary to keep the business viable. Workers were free to work for them or not, depending upon their desires. When the government imposes wage standards, and other worker benefits, upon the employer, this limits what both an emploer and his employees can do to benefit a business.

    tom_swift in reply to Mac45. | January 19, 2019 at 4:37 pm

    In other words, the market adjusted itself.

    Not at all. Unions are not a market force, they are an attempt to control the market by coercive—i.e., uncompetitive— means.

    The market is competition; unions circle the wagons to keep competitors out. They are the same thing as a trust or cartel, but from the other end.

      Mac45 in reply to tom_swift. | January 19, 2019 at 8:09 pm

      Employees [workers] are a commodity. That is why they call it a labor market. Workers are a business cost just like raw materials, power, business space, transportation, insurance, etc. And, business owners try to obtain those things at the lowest price possible. One way to maximize the price of labor is to organize the laborers to refuse to wok for wages below a certain level. This has been going on since the dawn of recorded history with skilled trades. Trade guilds are nothing more than unions. In the late 1800s, this organizational scheme was extended to the new “trades” of semi-skilled manufacturing workers. In the mid-1900s, this organization was expanded to general and unskilled workers. The result of this “unionization” was to raise the general economic welfare of employees. And, was not unilaterally imposed by government. Of course, the creation of organizations to control the price of commodities exists at all levels of the business universe [OPEC, etc.], not just labor. Again, this is a natural feature of the free market. When this organization becomes too restrictive to business, then government steps in to stop further concentration of power or to roll back the amount of control already in place. This is done for the benefit of the people, in general. This a natural, historical state of affairs, in industry. And, government’s role is to eliminate concentrations of power in the economic community and allow for more freedom to exist.

      When government gets involved in a manner which will reduce competition and raise costs, this is both counter productive and counter to the purpose of government. What has happened in the US, over the last 40 years, is that the government(s) have become more involved in the economy of the nation and has reduced the competition necessary to keep costs and prices low. Control of interest rates raises the cost of capitalization and reduces expansion. A guaranteed, third-party payer for medical costs encourages those costs to increase. Unnecessary regulation increases costs which are passed onto consumers, at all levels. And, mandated levels of compensation raises costs as well.

      When the government raises costs on businesses, those businesses have to find a way to reduce their costs. The easiest way to do that is to reduce employee costs by reducing the number of employees, consolidating jobs, and increasing individual productivity.

        Ragspierre in reply to Mac45. | January 20, 2019 at 12:28 pm

        You poor boob. Employees are NOT a commodity. When did you last buy an employee?

        Work is a commodity. Whether work is done by humans or by machines, it makes no difference to the employer of work.

        Your economics ignorance and inability to reason never ceases to amaze/appall me.

          JusticeDelivered in reply to Ragspierre. | January 20, 2019 at 5:15 pm

          D-Rump, of course workers were a commodity, where most have little value and were easy to replace. That is why unions were created. There were far more workers than jobs, hence their low value.

          I have had employees who were just grunts, and it was easy to replace a non performing grunt. I have also, in a different business, had highly skilled employees who earned 10-20 or more times as much as a grunt, and those were worth that differential.

          Before retiring, I earned considerably more per hour than lawyers, that was because at that time there was no one else with those skills.

          “You poor boob, ignorance and inability to reason” is an apt description of you. Everytime you lack the ability to offer a reasoned argument, you start lobbing petty, juvenile insults.

          This is actually an interesting discussion because it’s one of the measures of a society and its government. I do need to take issue with the idea that a cut in taxes is a pay raise. That is downright crazy. I earn my money, and I should get to keep it. When the government decides to take 40% instead of 45%, I did not get pay rise, I got less-d&cked by my government. To assume otherwise is to assume that whatever we earn is already the governments’, and what they deign to allow us to keep of our own earnings is a gift from the powers that be. That is exactly backward . . . or it should be to anyone who has read the Constitution.

          We are a free people granted more power in our Constitution than any other people ever in the known history of humanity. And what are we doing with this great gift from our Founders? A Republic if you can keep it? Hmph, we can barely grasp the central idea of freedom, so conditioned are we to expect “pay raises” in the form of taxation from the government. In what universe does that make sense? My God, the question alone sounds like an Onion article: “good news! Pay raises guaranteed by Bernie as he promises to tax all income at 90%.”

          Boobs in glass houses, should not throw stones:

          “Do tech businesses see workers as disposable assets?”

          https://www.denverpost.com/2016/04/29/working-it-out-do-tech-businesses-see-workers-as-disposable-assets/

          Once, firms cherished their workers. Now they are seen as disposable:
          https://www.theguardian.com/commentisfree/2015/aug/23/amazon-jeff-bezos-workers-rights-capitalism-employment-law

          Ragspierre in reply to Ragspierre. | January 20, 2019 at 5:54 pm

          Another boob self-identifies (again, in your case).

          Presumably, you were someone’s (more pity, them) employee at some point. You were NEVER their commodity. Rather, they paid you for the work they expected you to perform.

          An employee is never (ever in history) a “commodity” purchased by an employer. They are participants in a market exchange, and the market is work in exchange for compensation.

          This is really all too hard for you. You are incapable of thinking.

          Milhouse in reply to Ragspierre. | January 22, 2019 at 2:29 am

          Rags, of course workers are not commodities, and haven’t been since 1865, and Mac does not disagree with that. What Mac meant, which is true, is that workers’ labor is a commodity, which the workers sell and employers buy.

        Ragspierre in reply to Mac45. | January 22, 2019 at 8:01 am

        Milhouse, don’t dip your oar into what you don’t get.

        EMPLOYEES are not slaves. Never have been.

        EMPLOYEES are NOT a “commodity”. I take what people say at face value. You are free to read them more expansively…and incorrectly.

      Milhouse in reply to tom_swift. | January 19, 2019 at 11:41 pm

      Unions can be a market force, if and only they pursue their goals without resorting to force and intimidation, whether against employers, workers who refuse to join with them, or customers of the employers; and also if and only if the sellers of other goods and services in the market are also allowed to conspire to set prices, without being prevented by “antitrust” laws.

ScottTheEngineer | January 19, 2019 at 1:12 pm

I feel bad for the person that’s worked in that restaurant for years and finally made it from minimum wage to 14.50 an hour. They of course also got a pay raise of .50 cents but now they’re back to making the same amount as the high school dropout that started last week.

    But they’re still “little people”, so the left doesn’t give a damn about the effects on them.

    That shouldn’t matter; they’re not worse off just because someone else is better off. But if they’re truly only worth $14.50 an hour they will now be fired, together with the high school dropout who’s not worth more than $9 an hour.

      JusticeDelivered in reply to Milhouse. | January 20, 2019 at 5:19 pm

      People’s worth is always related to their productivity and the value of their productivity, with value often driven by rarity of their skills.

      venril in reply to Milhouse. | January 23, 2019 at 9:50 am

      Yup.

      And hire a person who’s actually worth 15/hour to the business in their place. Folks who are only worth 10 and hour will find it increasingly difficult to find employment.

I am shocked. I mean, who could have possibly seen this coming?

Tipping is usually not as generous when prices go and quality of service goes down. So what if they get 50 cents an hour in wages. Most of them lose a helluva lot more than 50 cents in tips.

It’s very easy to be generous with other people’s money. Apparently math is hard for these morons.

Economics is very hard when people’s behavior goes against the tenants of socialism.

The solution to the problem is simple. We need a new law in NY (a) Allowing employees to work up to 40 hours each week at their discretion, (b) Forbidding employers from reducing staff, and (c) Requiring business to get court approval before they go out of business. Problem solved.

https://www.nationalreview.com/2019/01/health-care-single-payer-public-sector-monopolies/

That’s OT to some degree, but it is a beautifully written piece by someone who understands economics, history, and liberty.

Enjoy.

    RedEchos in reply to Ragspierre. | January 21, 2019 at 11:19 pm

    Pull quote: “The case against a single-payer health-care system is not only, or principally, its cost. It is that government-enforced monopolies are undesirable for other reasons, from their propensity to abuse their monopoly positions to the fact that they cultivate an attitude of dependency — which also can be exploited for political purposes. Just as workers have more power in an economy with a large number of employers competing for their labor, would-be college students and health-care consumers are better off when they have a great range of choices offered in an environment of strong competition. (The best indictment of the U.S. health-care system, pre- and post-ACA, is that it does not actually produce or encourage such a consumer-empowering environment.) Monopolies in the public and semi-public sector are no more desirable than monopolies in the private sector.

    Bureaucracies and their masters almost always abuse their privileged positions, and they do not much care for criticism of those abuses.”

Hmmm. Look at the signs. I note the mucky fingerprints of the corrupt SEIU, spawn of ACORN.

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