We people who know our economics keep insisting that raising the minimum wage will lead to people employing less labour. That’s just what people do when the price of something rises, they buy less of it. The other name for people using less labour is that we will lose jobs, there will be unemployment. A number of theories are put forward for why this won’t happen but happen it still does. As the twin stories of Target and Wendy’s show us.
Wendy’s Chief Operating Officer, Bob Wright, stated the company experienced a five percent wage inflation and they expect wages to rise at least four percent in 2017. He addressed possible options to accommodate the rising costs of business and inflation, and the unfortunate answer was to eliminate 31 hours of labor each week.
Wages, the price of an hour of labour, go up, the number of hours of labour purchased goes down. That’s just what people do:
Last year, the kiosks were coming. It didn’t take them long to get here.
Wendy’s plans to install self-ordering kiosks in 1,000 of its stores — about 16 percent of its locations — by the end of the year.