It’s no secret that minimum wage hikes force businesses to find a way to offset the mandated increase in labor costs, either by raising prices or lowering costs elsewhere. Since customers are price sensitive, businesses often opt for cost-saving changes that substitute customer self-service for employee full-service.
Simply put, that’s why you bus your own table and fill your own soda at fast-food restaurants. Grocery stores look to self-checkout lanes to replace the need for a cashier, and table-service restaurants use touch-screen ordering devices to cut back on the need for wait staff. Even in the restaurant kitchen, a new robotic burger-maker can do the work of three full-time employees.
This shift is a direct result of mandated increases in labor costs. As businesses strive to meet customer demand for low prices in the face of a minimum wage hike, workers are moved from payroll to the unemployment line. Watch the video below to see an assortment of changes that businesses make to adjust to misguided policies like wage hikes.