Who Does a $15 Minimum Wage Help?

Would a nationwide minimum wage help or hurt American workers? Andy Puzder, former CEO of the parent company of Hardee’s and Carl’s Jr., explains.
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Script:

Progressive politicians love to talk about raising the minimum wage.

It makes them sound caring, compassionate, concerned. They’re on the side of the worker, standing against the greedy employer.

The current call is for a national -an-hour minimum wage – more than double the current federal rate of .25.

A number of cities and states are already there – including New York, California, Washington D.C. and Seattle. Others are considering it.

The left casts the minimum wage debate as a war between employee and employer. But most business owners pay their workers as much as they can. Finding and keeping good people is the hardest part of any employer’s job.

I know. For 17 years, I ran CKE restaurants, the parent company for Carl’s Jr. and Hardees. Our company and franchised restaurants employed over 75,000 people, but, as with most retail businesses, our profit margins were razor thin.

Based on my experience, if we adopt a national minimum wage of , here’s what will happen:

1. A lot of people will lose their jobs or have their hours reduced. According to a 2014 Congressional Budget Office study, just a minimum wage would cost half a million jobs as businesses terminate employees. Obviously, far more jobs would be lost at an hour. To survive, employers would have to reduce hours even for workers who manage to keep their jobs. That’s a pay cut.

2. Businesses will close, and the jobs they created will disappear. A recent report from researchers at the Harvard Business School found that each increase in the minimum wage results in a 4-10% increase in the likelihood of restaurants closing. An over an hour increase, to , would be devastating not only for restaurants, but for small businesses and their employees.

3. Young people will lose that entry-level job opportunity. My first job was scooping ice cream at a Baskin-Robbins in Cleveland, Ohio in the 1960s. I was paid just an hour. But it taught me valuable lessons – like the importance of showing up on time, teamwork, and presenting a happy demeanor to customers. No one can get that better job until they have their first job.

4. The cost of all workers will have to go up. If you hire a dishwasher at an hour, your cooks will be unhappy with their wages. You’re going to have to pay everybody more, which increases labor costs across the board. That’s more pressure on profits. Too much pressure and you’re out of business.

5. Fewer people will open businesses. an hour is a very steep hill to climb. Would-be entrepreneurs will do the math on labor costs and realize it’s just not worth the risk. This is a real cost to the economy that we can’t measure. A company that never exists never employs anyone.

6. Prices for everything will go up as businesses pass higher labor costs along to consumers. One of two things will happen: Either consumers won’t pay the higher prices and businesses will lay off workers or close, or consumers will pay higher prices and have less money to spend elsewhere. Either way, the higher minimum wage will represent a drag on the overall economy.

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20 Replies to “Who Does a $15 Minimum Wage Help?”

  1. $1hr when you got your first job is $8.46 today. Also, minimum wage when you got your first job was $8.46 in today's money. Today it's $7.25. I'm against all labor laws but I'm also against retardation and there's a lot of that in this video.

  2. I think australia has the highest minimum wage of $24/hr. This really makes it difficult for young people to get a job. When you are a teenager of about 15 its easier because they dont have to pay you full minimum wage, but if you get to 18 or older and you have no work experience you basically cannot find work without connections.

  3. CEO Of CKE Restaurants? I worked at Hardee's. Made next to nothing and it was always a skeleton crew but at least I was actually MAKING money. Good on you Mr. CEO.

  4. Your out of business, but don't care if the workers are out of a place to live. Maybe business owners need put their hands to the plow more. The workers make you the money. I guess you are so well to do, that you don't give a care about your workers. You are passing it on to the taxpayers to pay the workers the money you won't pay them through food stamps, housing assistance. You can't have it both ways. The reason we pay so much in taxes is because you refuse to pay your workers a fair wage. In n out starts their workers out at $12 an hour, then you say $10 an hour would kill you?

  5. You're neglecting the most important part of the minimum wage argument which is that people who receive a minimum wage spends virtually all, if not actually all, if their check. If you pay these people more, you're giving them more to spend providing more revenue for businesses they want to patronise. Paying these minimum wage employees more literally stimulates the economy more than alleged tax cuts. These people will likely not notice a few dollars more in their checks every two weeks, but they will notice the bump in their part of they're paid more per hour and this will spur consumer confidence causing them to go out and spend more.

    Please, attorney focusing solely on the idea that increasing wages only affects the employer in a negative manner. As a business owner myself who pays far greater than minimum wage, I can attest that paying your employees more has a net positive effect.

  6. The demand for higher minimum came about because the only jobs to live on up until now were those jobs. Hence why the scream for higher minimum wage. I believe if our economy was going the way it is now that demand wouldn’t have been an issue. But if a minimum wage job is all there was to work to survive what else did people have to do.

  7. The first argument is absolutely non sense. In our country in Germany, they repeated this so often bus the minimum wage did not cost even one single job, moreover it creates more jobs because the buying power rose. The people who earn more money are now able to buy more stuff for their daily life. So A high minimum wage is a good thing for business people and employed people

  8. FUN FACTS: Walmart's CEO earns 1,188 times as much as the company's median worker, Wal-Mart Has $76 Billion in Undisclosed Overseas Tax Havens, Walmart Workers Cost Taxpayers $6.2 Billion In Public Assistance

  9. well its obvious once you get all your private businesses to collapse the state can then take over and run a planned economy.

  10. Economic armageddon is coming to New York City. This guy is right on. We already have high taxes, cost of living is through the roof. Say high to another recession in 2019.

  11. TBH ? it works with some companies like fast food chains and super stores. Just have the big wigs and CEOs take less every year. They dont need 1.5 million a year or even 900,000 they would still survive. So no it's not completely broken.?

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