We spoke about it at length during our 24-hour live stream event and we will say it again here: raising the minimum wage to $15 at the federal level is a very bad mistake and will hurt small businesses across the country. We aren’t the only ones holding this position either as The Daily Wire notes it extensively as well; raising the minimum wage will hit small businesses very hard (Berrien, 2021). Even more from the frontlines, Kenny from Wisconsin joined us on our 24-hour live stream and noted that it would negatively impact his business and his ability to grow.
Here is what will happen if the minimum wage were raised to $15 per hour nationally: the small business would have to compensate for the additional cost, and they have primarily two ways of doing so. The first way to compensate is to reduce laborers (cut jobs) which reduces productivity in most situations, and the second way is to increase the price of the product or service (making it more expensive for the consumer), which typically leads to fewer products/services being sold. In either of these two situations, there is a common outcome: both the small business and the consumer are ultimately hurt due to the decrease in value created.
The goal of an economy should be to increase value – if we artificially and arbitrarily raise the cost of output, how can we expect an economy to increase value amongst its participants? The simple answer is, you can’t. If you want an economy that thrives, creates value, and increases the standard of living, you should also want it to support the small business community, not work against it. Raising the minimum wage to $15 per hour would dramatically increase costs to the small business and limit their ability to grow and add jobs to the economy. So, in a simple summary, raising the minimum wage to $15 per hours is bad for small business.
John M. Beaman
President of The McGraw Council Membership, Inc.
Berrien, H. (2021). Amazon wants $15 federal minimum wage; reports: small businesses would be hardest hit. The Daily Wire. Dailywire.com. Retrieved from Amazon Wants $15 Federal Minimum Wage; Reports: Small Businesses Would Be Hardest Hit | The Daily Wire