What’s a fair wage?

Posted on August 06, 2009

Re “Fair wages help small businesses” (Guest Comment, by Kent Ross, July 30):

The article ignores the wide range of industries that are disproportionately affected by mandated wage increases.

Kent Ross’s assertions may be true for his bicycle shop, but they do not address the wage pressures felt by employers in labor-intensive industries (like the restaurant industry) where employees are needed at every level of operations.

Salaries and benefits make up close to 60 percent of a typical restaurant’s costs. A business already running on tight margins will feel the effects of a mandated increase in labor costs much more severely when its operations are mainly labor-intensive.

Ross may claim his business is unaffected, but the experience of one company in one industry is hardly a match for decades of empirical research showing a direct relationship between job losses and minimum-wage hikes, particularly among vulnerable groups like minority teens and adults without a high-school diploma.

Kristen Lopez Eastlick
Washington, D.C.

Editor’s note: Ms. Eastlick is senior economic analyst at the Employment Policies Institute.