By NICHOLAS TRUJILLO
For minimum-wage earners who’ve had a taste of the $1.95 per hour pay raise, I can relate if you are feeling both happy and scared by the change.
My eyes light up when I see the significant increase in my paychecks. However, my face turns gray when I hear that another store has closed or raised prices because it can’t keep up.
In Tucson, the owner of Shlomo and Vito’s Deli blamed the minimum wage when it closed. The move threw 43 employees out of work.
I’m not an economist, but I would argue the closing represents free market principles. It’s not great a local deli closed, but it allows other entrepreneurs an opportunity to open another food store that might be economically stronger.
The ability to adapt and overcome obstacles shows the strength of a business. This life-and-death business cycle is healthy for an area’s economy.
The Metro Chamber of Commerce recently sent an anonymous survey to businesses across Tucson.
About 40 percent of businesses that responded said they are increasing prices to keep up.
Thirty-two percent are reducing employee hours.
I see this happening at my own job, at Frys. Many of my fellow employees are seeing their hours cut because they don’t have seniority and the store has to save money.
The chamber survey said 13 percent of businesses are considering closing for good. This is without a doubt bad for the individual businesses that close. However, a growing customer base will greet those that ride the wave of uncertainty and stay open.
Another 11 percent of the business owners said they would move to automation.
We won’t be having much human interaction at those stores. They’ll be based on machines with one or two people keeping up day-to-day maintenance.
Again, this process eliminates the weak businesses and allows others to come up with fresh ideas to keep their business going. This is good for everyone in the long run.
I understand that finding a new job is scary in the short run, especially when you have a family to feed. It’s also scary to see businesses close.
Focusing on that, however, will only make you close-minded to that fact that other businesses may perform better.
Opportunities are driven by the free market and its ability to make and break businesses.
This is the circle of life in the world of economics. We shouldn’t be afraid to take it on.
Nick Trujillo isn’t a conservative, but he likes a free-functioning market.
Filed Under: Opinion
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