Sunday, January 25, 2015
YOLO COUNTY NEWS
99 CENTS

$15 minimum wage would hurt us all

By Jeff and Laura Ambrose

What a great idea — let’s all get paid more! What’s wrong with that?

While on its surface this may seem like a splendid idea, it rests on several untrue assumptions:

* People are forced to work in low-wage, dead-end jobs in perpetuity.

Indentured servanthood is a remnant of the past. Minimum wage was designed as a starting point for entry-level, inexperienced workers.
* Hard-working, experienced, valuable employees can’t rise above minimum wage. 

Any intelligent employer wants to keep valuable employees and understands the need for pay increases.
* A minimum wage job is a person’s (or family’s) sole source of support. 

Entry-level employees are usually dependents of others. It wasn’t intended to support a family. In addition, many minimum-wage employees earn tips, which are reportable income in California.
* The only way to get employers to pay more is to force them. 

In a free-market, competitive economy, it makes good business sense to retain your best employees by offering higher wages and benefits.
* There will be no effect on the general economy (ripple effect). 

This will affect every business and service in our economy, and inflation undoubtedly will be the result.

Employers can afford it. It’s just a little less $$ in their pockets. 

Profit margins are very thin for many companies, especially in the industries that tend to hire entry-level employees. Employers will have no choice but to increase prices and/or downsize through automation.
* It only affects the lowest-wage employees.
This affects everyone. Unless we adopt a communist agenda, we still believe that more experienced/educated/valued workers merit higher wages than entry-level workers. So an enormous increase at the lowest levels will force across-the-board pay increases.

There are several proposals in California to increase minimum wage by as much as 50 percent over current state mandates. This is an enormous cost burden for thousands of small businesses, and for any businesses in the hospitality, tourism, retail and restaurant industries.

It’s not just the wage increase, it’s subsequent payroll tax increases, worker’s comp increases (since these are tied to wages), and all types of supply and vendor cost increases. There is no doubt that this will contribute to inflation.

And whom does that hurt most? Those earning the lowest wages and those on fixed incomes. Is that what we want?

All but seven states pay lower wages for those in tip-earning positions. All California employers are forced to report their employees’ tips as taxable income, so as such, it should be calculated into the minimum wage.

The proposal to increase the minimum wage to $15 per hour in Davis puts this city in a particularly precarious position. It would force local businesses to compete with businesses just outside the city with much lower labor costs. There’s little doubt that consumers will choose to drive a few miles to neighboring towns when there is a significant cost difference. And new businesses most likely will choose these communities over Davis since it can no longer be competitive.

At Woodstock’s, we hire many entry-level, inexperienced employees. One of the advantages of restaurant work is the flexible scheduling we can offer, especially to students. All we expect is a positive attitude and willingness to learn.

We invest hundreds of hours in training our team. We believe in promoting from within, and we offer pay raises at least annually. We have offered health insurance and dental benefits to our employees for more than 20 years, and we share ownership with our management team.

As a small business, we emphasize fresh, handmade-to-order food, along with a friendly, fun environment. It’s the labor-intensive nature of our business that already causes us to charge more than the national chains. The proposed increase to $15 for minimum wage constitutes an 87.5 percent increase over what we currently pay. Since labor makes up 31.6 percent of our costs, it’s obvious that this will force us to increase our prices substantially and look for ways to automate.

The laws of economics indicate that as prices increase, less product is sold, which means that less labor is required. We can only hope that we can still sell some product at these inflated prices in Davis, but the hurdles will be enormous.

— ​Jeff and Laura Ambrose​ are the owners of Woodstock’s Pizza Inc.

Comments

comments

Special to The Enterprise

  • Recent Posts

  • Enter your email address to subscribe to this newspaper and receive notifications of new articles by email.

  • .

    News

     
    Four days of unusual, adventuresome music

    By Jeff Hudson | From Page: A1 | Gallery

    Red Cross honors community heroes

    By Lauren Keene | From Page: A1 | Gallery

     
    Bridges of Yolo County: Wear, tear … repair?

    By Elizabeth Case | From Page: A1 | Gallery

    Abe ‘speechless’ after video claims IS hostage dead

    By The Associated Press | From Page: A2

     
    GOP presses state bills limiting gay rights before ruling

    By The Associated Press | From Page: A2

    Abortion opponents express renewed hope at California rally

    By The Associated Press | From Page: A2

     
    Spanish police arrest 4 suspected members of a jihadi cell

    By The Associated Press | From Page: A2

    Rockets kill 30 in Ukrainian city as rebels launch offensive

    By The Associated Press | From Page: A2

     
    Fake schools draw federal scrutiny

    By The Associated Press | From Page: A3 | Gallery

    Winter produce available at Sutter market

    By Special to The Enterprise | From Page: A3

     
    Sip wines at St. James’ annual tasting

    By Special to The Enterprise | From Page: A3

     
    Donations to be distributed during homeless count

    By Anne Ternus-Bellamy | From Page: A4

    Speaker will share computer security tips

    By Enterprise staff | From Page: A4

     
    Logos Books celebrates 5 years, offers language groups

    By Enterprise staff | From Page: A4

    Australian olive oil company opens U.S. headquarters in Woodland

    By Special to The Enterprise | From Page: A4

     
    Explore at the YOLO Outdoor Expo

    By Enterprise staff | From Page: A4

     
    Pedal around Davis on weekly bike ride

    By Enterprise staff | From Page: A4

    Yolo animal shelter seeking rawhide donations

    By Lauren Keene | From Page: A5

     
    Woodland Healthcare employees take Great Kindness Challenge

    By Special to The Enterprise | From Page: A5

    At the Pond: Nest boxes give birds new homes

    By Jean Jackman | From Page: A6 | Gallery

     
    California ranks worst in nation for guidance counselors

    By The Associated Press | From Page: A7

    Davis, Woodland are saving water

    By Elizabeth Case | From Page: A12

     
    Words and Music Festival events

    By Jeff Hudson | From Page: A12

    .

    Forum

    Caring for the aging mouth

    By Samer Alassaad | From Page: A8

     
    Family isn’t keen on relationship

    By Creators Syndicate | From Page: A8

     
    We have the right to choose

    By Letters to the Editor | From Page: A10

     
    We don’t have to suffer

    By Letters to the Editor | From Page: A10

    City helped immensely

    By Letters to the Editor | From Page: A10

     
    Rick McKee cartoon

    By Debbie Davis | From Page: A10

    Big utilities’ nightmare begins to play out

    By Tom Elias | From Page: A10

     
    Mayor’s Corner: Let’s renew Davis together

    By Dan Wolk | From Page: A10

    From innovation parks to innovative buildings and planning

    By Special to The Enterprise | From Page: A11

     
    When measles spreads from Disneyland, it’s a small world after all

    By New York Times News Service | From Page: A11

    .

    Sports

    Loud crowd sees DHS boys win

    By Spencer Ault | From Page: B1 | Gallery

     
    Lady Devils hold off Pacers, stay perfect in league

    By Enterprise staff | From Page: B1

    Wildcats’ inaugural kids development league exceeds expectations

    By Bruce Gallaudet | From Page: B1 | Gallery

     
    Aggies get top 2015 gymnastics score, but fall short

    By Bruce Gallaudet | From Page: B1 | Gallery

    UCD men take two tennis matches

    By Enterprise staff | From Page: B8

     
    Watney in ninth at Humana Challenge

    By Staff and wire reports | From Page: B8

    .

    Features

    .

    Arts

    .

    Business

    Davis man focusing on cannabidiol business

    By Will Bellamy | From Page: A9

     
    Marrone Bio’s Regalia approved for new uses in Canada

    By Special to The Enterprise | From Page: A9

     
    UCD grad makes insurance ‘hot 100′ list

    By Enterprise staff | From Page: A9

    Yolo County real estate sales

    By Zoe Juanitas | From Page: A9

     
    .

    Obituaries

    Thomas George Byrne

    By Special to The Enterprise | From Page: A4

     
    .

    Comics

    Comics: Sunday, January 25, 2015

    By Creator | From Page: B8