[alphazard]

It's too soon to say. Increasing the cost of labor will reduce jobs in the short term, and increase the cost of fast food. In the medium term, that may lead to people cutting back on fast food, which then leads to more job loss.

If fast food companies have perfect knowledge of their market, then the immediate job loss would be all that happens, but they don't so it will take some time to adapt to the new market, and see if consumers will bear the increase in cost.

That's not even considering substitutes for labor, which have never been as competitive as they are now. AI, robotics, single-purpose machines, etc. One negative to a minimum wage is that we don't actually know the market price of labor. When there is a shift from humans to machines for labor, it will happen quickly and without warning, rather than slowly as humans become dissatisfied with decreasing wages.

[barchar]

Also, you only really need to cover any increased taxes, everything else you pay them is someone else's income (fast food workers probably spend almost all their income). So your getting a big income increase to people very likely to spend it, this creating more employment.

Maybe here this will be offset by decreases in welfare program usage and the very, very high effective marginal tax rates that creates.

[sroussey]

Indeed, the positive for increasing minimum wages is that it makes robotics and automation more cost effective.

With Silicon Valley being in California, one might think this is done on purpose—favoring the automation sector over the wage holders.

Once these companies get some scale in California, they can then drive prices lower to be competitive in other states.

In the end, sacrificing minimum wage workers in California will lead to (generally California based) automation companies taking this revenue across the country.

[toast0]

Labor reduction in fast food doesn't necessarily look like 'automation'

It's things like self-ordering, machines that make change (if cash handling still matters), conveyor ovens/charbroilers, more centralized food prep, self-service and automated beverage dispensing.

Plenty of automation is happening outside of California though. Here's an Illinois bases company's blurb about beverage automation [1].

Reducing labor in small amounts increases service capacity, and in large enough capacity lets you operate a restaurant with a smaller minimum crew.

[1] https://dimontegroup.com/projects/cornelius-quick-serve-pro/

[MarkusQ]

> Labor reduction in fast food doesn't necessarily look like 'automation'

> It's things like self-ordering, machines that make change (if cash

> handling still matters), conveyor ovens/charbroilers, more centralized

> food prep, self-service and automated beverage dispensing.

Those are things that were previously being done by people that are now being done by machines. In other words, automation.

[barchar]

It does really disfavor low productivity industries.

Actually, a core part of Sweden's original plan for social democracy was to have "solidaristic wage policy" where high wage workers would accept a lower wage in exchange for a higher one for low wage workers. The idea was you'd both squeeze low productivity businesses out _and_ provide a windfall to high productivity ones, who could expand faster.

[throwaway4496]

Robots will always be cheaper, it is not a matter of if they will come, it is a matter of when. That is no reason the state should subsidise workers for big corporations by allowing them to pay such low income that workers are often eligible for social security.