A new survey conducted by Harri, a workplace management software company that works with restaurants, found that restaurants have responded to recent minimum wage hikes by increasing menu prices and reducing employee hours.
The survey polled 173 restaurants about the impacts of raising the minimum wage. The results provide an eye-opening view of the harsh reality local businesses are facing. Eighty-three percent of respondents reported that their labor costs have increased at least three percent. Seventy-one percent of respondents said to cope with the rising labor costs they would raise menu prices while nearly half reworked the prices of their food and beverage options to combat rising labor costs.
Even worse, 64 percent said they plan to reduce employee hours and 43 percent said they will eliminate staff positions.
Other restaurants have responded to rising labor costs by shuttering their doors altogether. In California, two restaurants recently cited increasing labor costs as a factor in closing.
These results should alarm both state and federal lawmakers who are considering raising the minimum wage nationwide. These policies only hurt those they intend to help by eliminating jobs and forcing businesses to close.