Lots of workers are happy, lots of Democrats are happy. Lots of Republicans are unhappy, lots of small business owners are unhappy.
It’s that last that’s the most important. See, with a higher minimum wage they’ll be shouldering all the burden. There’s sure not going to be any federal subsidies for them (although payroll tax breaks might help).
But probably not in the short-term, so they lay off workers.
That mean’s Joey’s Fish Shack over on Lawrence has to lay-off 2 of its 5 workers – Sam and Jasmine. But that’s a real pain in the ass for owner Joey, who’d rather be…doing boss things, not working the line making $2.99 fish sandwiches.
So Joey ups the hours on the other three employees, who are now working 40 hours – full time! What’s more, they’re getting federal health benefits under Obamacare (assuming of course Joey’s is a franchise that falls under some kind of umbrella employee size and they’re in an educated state).
That’s great for those workers – Johnny, Sally, and Jim-Bob – because it means they have a few more bucks on each paycheck. And since each is a college dropout with a former or current drug habit, alimony, child support, student loans, or perhaps all of the above, it works out great!
We know those workers at the low-end of the pay scale are going to be spending all of their paychecks, and that means local businesses benefit.
Flush with extra earnings, they have to hire. Sam’s able to find a job over at the Hardware Emporium while Jasmine starts working full-time at the new boutique downtown.
What’s more, because that minimum wage stays high, both the hardware store and the boutique are keeping highering down while boosting the hours of current workers.
Finally all five of these people from our story – Sam, Jasmine, Johnny, Sally, and Jim-Bob – can make a living wage without having to work two part-time jobs.
And Joey? Sadly, Joey’s been in the back all day with the runs from that fish taco special.