Minimum Wage Hike Hits Hard in Oakland’s Chinatown

Four restaurants and six grocery stores have closed since January
  • Publication Date: March 2015

  • Topics: Minimum Wage

WASHINGTON – Today, the Employment Policies Institute (EPI) highlighted the devastating impact that Oakland’s new $12.25 minimum wage is having on the city’s Chinatown district. It was reported in the San Francisco Chronicle this weekend that at least ten businesses in and around Chinatown, including four restaurants and six grocery stores, have closed in part due to the 36 percent wage hike.

The impact of Oakland’s new minimum wage hasn’t been limited to Chinatown. In order to cope with the increased labor costs associated with the wage hike, numerous small businesses in town, including Homestead, Caffee Teatro, Johu Beach Club, The Half Orange, and 475 Café, report planned price hikes of up to 20 percent. Some restaurants have eliminated tipping altogether, causing a dramatic drop in hourly take-home pay for some employees.

Oakland’s small business closures and substantial price hikes coincide with the much-anticipated release this week of an impact analysis of Los Angeles’ proposed minimum wage hike to $13.25 an hour. The study is being conducted by the same embattled UC Berkeley research team led by Michael Reich which concluded last year in now-discredited studies that Oakland and San Francisco’s wage hikes would have negligible costs.

“Oakland’s small businesses are the latest victim of the city’s devastating 36 percent wage hike, which happened overnight earlier this month,” said Michael Saltsman, research director at the Employment Policies Institute. “As Los Angeles and other cities now consider similar mandates, they should look to real-world experiences rather than discredited studies from biased researchers at UC Berkeley.”