The New York Times Wonders Why San Francisco Waiters Are Disappearing, Blames Everything But $15/Hr. Minimum Wage

The New York Times struggles vainly to blame everything but San Francisco's $15/hour minimum wage (which goes into full effect on July 1) for the disappearance of table waiting jobs:

So burgers get more expensive as houses do. But even wealthy tech workers will pay only so much to eat one. “If we were to pay what we need to pay people to make a living in San Francisco, a $10 hamburger would be a $20 hamburger, and it wouldn’t make sense anymore,” said Anjan Mitra, who owns two high-end Indian restaurants in the city, both named Dosa. “Something has to give.”

If customers won’t buy $20 burgers, or $25 dosas, and the staff in the kitchen can’t be cut, that something is service. “And that is what we did — we got rid of our servers,” Mr. Mitra said.

This brings up an important point: productivity increases are a prerequisite to rising real wages. Today's waiters have the same productivity, more or less, as their predecessors a century ago; there's only so many people one person can feed in an hour. It's basically an unskilled job, so the competition for labor is essentially infinite.

The second quoted graf above brings up something Brian Doherty wrote in Reason back in 2013: if there is a social obligation to pay a "living wage", why does it only fall on business owners? In other words, if business owners need to raise prices to meet the new, higher payroll, why is there no similar obligation on the part of patrons to spend more? The circle-squarers of the left never consider these kinds of problems. Their utopias rely upon ignoring second-order effects.

Also:

The city also requires employers with at least 20 workers to pay health care costs beyond the mandates of the Affordable Care Act, in addition to paid sick leave and parental leave.

I guess if those jobs don't exist, then it doesn't matter what they're "guaranteed".

Saturday Bullets

• Hey, didja know that penises and vaginas are a social construct?
  

  Fine is a sure guide to the science, building up complexity without sacrificing clarity. By the time she’s finished, any lingering confidence that hormones exert a simple dose-response influence on our behaviour is thoroughly done for. Instead, testosterone works in intimate concert with relationship structures – a blow to its dignified reputation as the singular, commanding “male hormone”. Even something as incontrovertibly binary as our male and female genitals is shown to be part of a complex cultural system. As Fine says, “it’s the genitalia – and the gender socialisation this kicks off – that provides the most obvious indirect developmental system route by which biological sex affects human brains”.

• Now that Trump is president, even journalists can apply critical thinking skills again.
• Editors, please.
• Econ 101 still works, no matter how much "living wage" advocates wish otherwise.
  

  The real impact of the minimum wage, however, is much less clear than these talking points might indicate. Looking at historical experience, there is no obvious relationship between the minimum wage and unemployment: adjusted for inflation, the federal minimum was highest from 1967 through 1969, when the unemployment rate was below 4 percent—a historically low level.

  If you use general unemployment as a basis for your comparison (the real problem is specific unemployment among the low-skilled), you've already failed to address the argument.

Obamacare Enrollment Is Not The Same Thing As Paid For

Something I came across thanks to a tweet by Rich Weinstein yesterday: it turns out that, while Obamacare enrollment is only a smidge off-target, comparatively, the number of people who have actually paid for coverage is a vastly different thing:

"Facts are stubborn things..."
Jordan Candler: Is the ObamaCare Death Spiral Underway? — The Patriot Post https://t.co/ywv8wQL1tl

— Rich Weinstein (@phillyrich1) March 16, 2016

As The Hill notes, only 8.8 million people have actually paid for their services, "a drop of almost 25 percent compared to the 11.7 million people who were signed up at the beginning of 2015." As the Kaiser Family Foundation report in the story at the tweet above notes,

Affordability remains a challenge. A recent Kaiser poll found that the overwhelming reason why people who are uninsured say they are uncovered is cost – 46% of uninsured, non-elderly adults say they tried to get coverage but found that it was too expensive. However, it is difficult to separate lack of affordability from lack of awareness of financial help that may be available, which could be addressed through more intensive outreach. For example, going into this last open enrollment period, another poll found that 82% of uninsured adults had not been contacted in the previous 6 months about the health law.

Ya think? It was always a bad idea to rely on young adults as the fiscal backbone of Obamacare. Such have poor-paying jobs, and careers delayed by minimum wage hikes keeping young people out of the labor market at near record levels — and thus delaying their advancement to other, better-paying jobs.

Getting Better Understanding Of Minimum Wage Changes

I stumbled upon this AEI chart on Mark J. Perry's Twitter feed (@Mark_J_Perry):

It took some digging, but the full story is available as a blog post at their Carpe Diem site. One of the big issues I see with a lot of research in this area is how it tends to push an agenda one way or another by purposefully changing the goalposts. One example is this tendentious piece from Occupy Democrats, heralding minimum wage job losses as a nothingburger, or Erik Sherman's piece claiming the then-current $11 minimum wage resulted in restaurant employment "soaring". Perry's post goes a fair distance to improving the heat vs. light ratio minimum wage discussions tend to elicit. It's not perfect, but it is a better guide than most. A few observations:

1. As Perry asks, "soaring compared to what?" Restaurant employment in the Seattle metropolitan area is outpacing Seattle proper, whose first derivative appears to approach zero, i.e. growth has stopped.
2. This is the kind of thing we really need, i.e. looking more closely at broad effects on employment among people likely to be in minimum wage jobs rather than among the entire labor pool.
3. Restaurant employment is a good but not wholly satisfying proxy for minimum wage employment, because it also encompasses fine dining restaurants that do pay some employees substantially more (if only on tips).

Minimum Wage: Shot & Chaser Edition

Shot: Anybody remember this, back in February, 2014?

In a surprising move, Gap Inc. informed its employees on Wednesday that it would set $9 as the minimum hourly rate for its United States work force this year and then establish a minimum of $10 next year.

Gap said this move would ultimately raise pay for 65,000 of its 90,000 American employees, including those at Banana Republic, Old Navy and other stores.

Gap is making this move as many states consider raising their minimum wage, and as Republicans and Democrats debate a bill that includes a proposed increase in the federal minimum wage to $10.10 an hour by 2016.

President Obama has endorsed the increase, and has campaigned for it at stops around the country.

Chaser:

Apparel retailer Gap Inc (GPS.N) said it would close a quarter of Gap specialty stores in North America over the next few years, including 140 this year, potentially affecting thousands of jobs as the company struggles with a slump in sales at its namesake brand.

San Francisco-based Gap also said it would cut 250 jobs at its headquarters.

The company did not say how many employees would be laid off as a result of the store closures. As of Jan. 31, Gap had about 141,000 full- and part-time employees in about 3,700 company-owned and franchise stores worldwide.

Most People Escape Minimum Wage Quickly

I frequently enough encounter this trope that it's worth rebutting at some length:

This is supposed to make a case for improving the lot of those in this world making minimum wage by raising it. The truth, however, is vastly more interesting. For this, we turn to the Bureau of Labor Statistics research on minimum wage employees (PDF), wherein we find slightly more than half (50.4%) of all such workers are under 25 years old. This is actually very good news, because it points to a crucial fact: most people get off the minimum wage early in their careers. To see why this is so, it's necessary to look at the labor force population by age bracket (available here as Civilian Labor Force, numbers as of January, 2015):

If half the minimum wage work force is in the left two brackets, it means the balance must be distributed among the others, and therefore less numerous in each one. In fact, only 1.6% of hourly employees older than 25 make minimum wage — or less! (How can that be?) Minimum wage work affects only a tiny number of people.

See also: this Pew Research piece.

Correlation != Causality: Porn And Marriage

I've already had several people post this Washington Post Wonkblog piece about porn and marriage which asserts that young men aren't getting married because they are consuming more porn, and thus no longer need women, or something:

Broadly, higher Internet usage was associated with lower marriage rates. But pornography use in particular was more closely linked to those participants who were not married than any other form of Internet use, including regular use of financial websites, news websites, sports websites, and several others. The opposite, for comparison, was true for religious website use, which was positively correlated with marriage.

"The natural reaction might be to dismiss the findings as confirmations of an obviousness", they continue, "that men who are married tend to look at porn less frequently precisely because they are married." Well, duh, but maybe we could lift a finger to see, perhaps, why young men might be unmarried? That, of course, is a question the Wonkblog probably doesn't want answered truthfully, because of their political biases.

Asking young women what they want in a potential mate, a poll by the Pew Research Center in September revealed that 78% want a man with a stable job; no single answer by men was even close to that high. That is to say, young women — despite years of feminist action — overwhelmingly value men for their economic contributions. So why might young men, particularly young and poor men, not be getting married? The answer is obvious if you look at youth labor participation, with some observers speculating that structural youth unemployment may well be permanent. While it's been hotly debated whether Obamacare and a recent minimum wage step increase have contributed toward this, it is incontestable that youth unemployment remains stubbornly high. If young men, especially young men without college degrees, are to marry, their job prospects must improve, and dramatically.