LA Increases Minimum Wage, Employers Invest in Machines
May 22, 2015 By
Liberals have once again shown their startling ignorance regarding economics and how humans react to laws by altering how they spend money, whether for personal or business reasons. On Tuesday, by an almost unanimous vote, the Los Angeles City Council passed a law raising the minimum wage to $15 an hour. Wages will begin rising this year to $9 per hour and reach $15 within five years.
Employers response? According to the Los Angeles County Business Federation, the number of employers that say they intend to invest in automation that eliminate jobs doubled this year, to 59 percent.
Similar laws have passed in other cities recently, such as Seattle, which has resulted in a record number of restaurant closings. Small business owners in LA are claiming that they too, will be forced to close or move.
Despite what should herald a tremendous hiring boom in Los Angeles County, the “Dead Hand of Government Impoverishes the Middle Class” through a combination of high taxes, restrictive regulations, excessive permitting–and minimum wage hikes.
Tracy Rafter, founding Chief Executive of the Federation, commented on this year’s results, “Hiring, which it’s a bit better, is not where things are growing–they’re growing in technology,” because, “People cost so much more than technology over time.”
From Breitbart:
L.A. businesses are especially frustrated with the bureaucratic nightmare they experience dealing with of local, county and state building and safety planning departments. The BizFed poll found that the burden of securing operating permits was the most frustrating issue for local businesses, other than taxes and compliance fees.
For companies that do expand, they “must navigate what’s been called a spaghetti bowl of permit requirements”, according to the Times. Rafter worries that technological advancements have made it easier for frustrated local companies to just go “mobile” and conduct the bulk of their business elsewhere.
We see the same story unfolding across the nation in cities and states with unfriendly business environments; high unemployment rates, high taxes, and onerous regulations which prove to be a drag on the economy. Almost always Democrat majority run, their typical “solution” is to throw more gasoline on the fire.
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