President Barack Obama tends to use boring boilerplate when he calls for hiking the minimum wage. It’s time to “give America a raise,” he drones on.
These calls ignore volumes of research showing that this would be, yes, a raise for some, but also a pink slip for others and fewer jobs available for those laid off or just entering the job market. The respected Congressional Budget Office estimates (pdf) that a national minimum wage hike would kill off between 500,000 and a cool million jobs.
On Wednesday, Obama decided to both ratchet up and spice things up. Speaking in Ann Arbor at the University of Michigan, the president played to the mostly college-age audience by saying that if Republican priorities were a sandwich, they would be called a “stink burger or meanwich.”
This gross-out culinary theme went well with the president’s trip to Michigan. He was helping to get the ball rolling for a national labor organization called the Restaurant Opportunities Center’s effort to get a minimum wage hike, to $10.10, on the statewide ballot in November.
While in town, the President took a high-profile lunch break at the Ann Arbor deli Zingerman’s, whose owner is actively lobbying for a minimum wage hike. Zingerman’s recently raised the pay of it entry level workers to $9.00 an hour, which the owner says he hopes will go up to $11.00 at the end of the next fiscal year.
Because it caters to a higher-end clientele, Zingerman’s can afford to pay higher wages than most of its lunch-trade competitors. According to the Detroit News, Obama’s share of a lunch for two with U.S. Senate Candidate Rep. Gary Peters (D) came to “almost $23 before taxes — $13.99 for the [small] Reuben, $6.50 for the salad and $2.50 for the tea. If Peters made the same order, the total tab after taxes was about $50.”
Remember that paying $13.99 for a small sandwich for lunch is considered a luxury by most Americans, including Michiganders. A boutique eatery like Zingerman’s that can command such prices probably won’t be put out of business by a government mandate to pay more for entry level help. That also applies to large retail enterprises like Costco. But some of their competitors will not be so fortunate.
If a minimum wage hike drives up the cost of hiring entry level workers such as dish-washers and shelf-stockers for smaller “mom and pop” job providers, these already-struggling small business owners will be forced to make some tough decisions. They will either lay off workers, reduce hours, raise prices or throw in the towel.
The result would be fewer choices and higher living expenses for working- and low-income Americans. And also demonstrably fewer jobs. In March, a survey of minimum wage employers found that about 54 percent would reduce hiring if the increase becomes law, and 38 percent would lay off employees.
Obama and organized labor are pushing minimum wage hikes in Michigan and several other battleground states as a way of changing the subject from the slow motion train wreck of Obamacare.
They hope low income voters will come out to vote for minimum wage hikes and pull the lever for Democrats while they’re at it. When and if that happens, an awful lot of people will be out of jobs. If that’s not a “stink burger or meanwich” of an outcome, it’s hard to know what would be.