Dear Ms. Notley,

Well, it’s been a year since our last letter and I figured you would be dying to know how things are going, especially since your government’s recent announcement.

I am sure you’re deeply concerned about the well-being of my small business so let me bring you up to speed.

After nearly two months of delays due to construction we managed to get the doors open in mid November and I am pleased to share that it has been a very good first eight months of business.

Despite what many consider to be a sluggish economy we have managed to surpass our sales goals and continue to see the business grow as more people hear about our little restaurant.

We have even managed to turn a modest profit and I can even take a salary now.

It hasn’t all been sunshine and lollipops though.

My days start early and seem to never end.

Every day feels like a Monday, and many weeks a day off isn’t in the cards.

Now I know what you’re thinking, if I was afraid of hard work I shouldn’t have become an entrepreneur.

Here’s the thing, well two things actually, the first being that I am not afraid of hard work, long days and sacrifice.

I’m a cook after all.

The second, far more important point, is that if guys like me, risk-takers, don’t do it, it won’t matter how high you raise the minimum wage because no one will be employed.

Now I’m not a “doomsday” kind of guy, crying that your agenda is going to shutter my business, but I am a realist and I can do the simple math on what kind of impact this will have on my business.

I have 27 employees, with 15 of them receiving minimum, of which only three are non-service staff.

If they each work an average of 30 hours a week then I can expect this wage hike to increase my costs by $23,400.

The three staff that do not work directly for gratuities are high school kids, working as dishwashers, learning some valuable life skills like team work, and punctuality, all while making $300-400 every couple of weeks.

The remaining service staff average $35-40 an hour in the low end and over $50 an hour when at our peak. The remainder of my hourly staff make between $12.50-19 an hour, plus $2-4 an hour in gratuities.

So, if I were to only provide wage increases to those staff already doing quite well and our dishwashers my other staff, who work extremely hard for me, would feel slighted. Most, if not all of my remaining team will receive a raise to reflect their work in comparison to those earning minimum wage.

So, given that these employees work closer to 45-50 hours a week I can expect to add another $20,000 to our costs. Throw in the impact we will see as a result of the carbon tax, whoops, I mean levy, and the upcoming increase in craft beer prices, and that modest profit I made this year will likely vanish without having to make some adjustments. One of those will be to sharpen the pencil when it comes time to changing the menu.

I will look for opportunities to slightly increase pricing in areas I feel we can afford to, which are getting harder to find. There is only so much our guests are willing to pay, no matter how much money they are making.

The other sacrifice will be to our support staff.

Rather than bringing in that $12.20 an hour dishwasher I will keep on an extra cook, who is more skilled and experienced, and have everyone contribute to cleaning up.

We will likely have to roll the dice some nights, having one less server attending to our guests than desired, but it’s a choice we will be stuck paying.

So while our service staff will be making an extra dollar an hour while on the floor, will they be getting as many shifts, or as many hours during that shift?

Even if I cut their six-hour shift down to five and half in an effort to meet our goals, their increased wage will be lost. What about the young student, the dishwasher, the busboy, or the hostess? Will they get their first job in a restaurant as easily?

I started 22 years ago scrubbing pots, and it lead me to where I am today. My restaurant wasn’t handed to me, I fought for it, tooth and nail, but I never would have taken that plunge if I hadn’t been introduced to the business all those years ago.

Enough about “poor old me” though. Let’s talk about your party’s plans to tackle the true issues at hand.

Is anyone asking the question why 300,000 Albertans find themselves making less than $15 an hour? Do we know how many of these people are students, even high school kids?

When we look at the real numbers, and I assume you have them, is there a plan to help these people beyond giving them a few more taxable dollars?

I truly do feel for those people trying to raise a family on a single minimum wage income. I have made $9 an hour doing what I loved and know how difficult it was fending for myself on that wage. I could not imagine how daunting it would be to try to raise a family, but are you taking any of those new tax dollars collected and helping these people reach for more?

Are there educational grants available for low-income individuals? Are there funds available for help with day care? I am quite certain that most of these people would gladly take the hand up, rather than a hand out, if it meant the opportunity to improve their future, and find new employment with better compensation.

I am curious if your party has truly done their homework when it comes to the impact of your actions, when it relates to this mandate, or many of the other ones pushed through in the past year.

I also wonder how well you sleep at night, watching jobs continue to leave our province, as the unemployment numbers approach 8%.

I know there are countless nights I struggle with decisions over the business, but I sleep quite good when it comes to my people. I am grateful for them, because without their continued efforts I would be nothing.

I do the best I can for them and will continue to do my utmost to keep our business going and a roof over their head, no matter what the industry, the economy, or the political powers that be throw our way.

Anyways, it was nice catching up with you. Same time next year?

Restaurant industry unharmed by modest minimum wage hikes
BySusan Kelley

In the past 20 years, whenever federal, state or local laws have modestly raised minimum wages, the U.S. restaurant industry has opposed them. Restaurateurs say higher wages force them to cut staff and jack up prices to offset reduced revenue, which in turn makes their customers unhappy, slashes profits and even puts their restaurants’ survival in jeopardy.

Now a new study finds that modest increases to the minimum wage have not had those negative effects. The boosts have had neither a large nor reliable impact on the number of restaurants or employees, even when restaurants have raised prices directly in response to wages increases, the authors said.

"There is no doubt that restaurateurs face higher expenses as a result of minimum wage increases, but if restaurants are raising prices to compensate, those increases do not appear to decrease demand or profitability enough to sizably or reliably decrease either the number of restaurants or the number of employees,” said co-author Michael Lynn, the Burton M. Sack ’61 Professor in Food and Beverage Management and professor of consumer behavior and marketing at the School of Hotel Administration (SHA).

...

So far, the Seattle minimum-wage increase is doing what it’s supposed to do


What happens when a study shows that a minimum-wage increase is simply having its intended effect? When it’s found to raise the pay of low-wage workers without causing much in the way of the job displacements that critics rail about? Unfortunately, one thing that apparently happens is the findings get misinterpreted (though, as I’ll show, this is partly due to the omission of key statistical information).

The study to which I’m referring examines the impact of the first stage of the minimum-wage increase in Seattle. In April 2015, the city raised its minimum wage from around $9.50 to $11, on the way to $15 an hour by 2017 (for employers with 500 or more employees and certain other employers; the minimum wage for most Seattle businesses rose to $10 in April 2015, and $15 will not go into effect for all Seattle businesses until 2021). The pay of affected workers went up almost 12 percent, compared to a 5 percent increase for workers in nearby, similar places that weren’t bound by the increase. The study’s authors concluded that the increase raised the pay of affected workers by seven percentage points more than might otherwise have occurred.

Too many Americans aren’t paid enough to enjoy a decent standard of living. That is unacceptable in a country as rich as the US. California and New York plan to phase in a $15-per-hour minimum wage over the next few years, amid a push for $15 to also be set as the national minimum wage, from $7.25 today.

This is the wrong way to solve the problem. It’s not just that a wage increase that large risks job losses, but if the goal is a fairer distribution of income between rich and poor, then the minimum wage is a lousy way to achieve it.

Sadly, the money to pay low-wage workers more has to come from somewhere. It can either come from the savings that result from cutting jobs or hours, from dipping into profits, or by raising prices. Even pro-minimum wage economists worry that $15-per-hour goes too far and risks job losses.

Higher prices impact everyone, rich and poor alike. For this reason, Stanford economist Thomas MaCurdy argues that a minimum-wage hike is similar to a rise in the sales tax rate. He studied a US minimum-wage hike in 1996—an increase from $4.25 to $5.15 per hour—and concluded that the resulting rise in prices amounted to a 0.59% tax on all low earners. The effective tax was lower for high earners, because the extra money they had to spend accounted for a lower share of their wallets. So it’s not just a higher sales tax, but a regressive one as well.