It’s tough running a small business.
Your rent goes up, but what can you do? So you muddle on. Fuel costs go up, but you muddle on. The cost of supplies goes up—food, inventory, whatever—and you muddle on. The cost of borrowing goes up, and you muddle on. Health insurance premiums go up (oh man do they ever), and you muddle on.
But lawmakers talk about raising the minimum wage, and you throw up your arms and threaten to close your doors.
So what makes the cost of labor different from all those other fluctuating costs business owners must deal with every day? Labor is the only cost of business where you set the price.
And that’s where I think a lot of this emotional response to the minimum wage comes from. It’s about control. Both controlling one’s costs and controlling one’s employees. A government mandated minimum wage upsets the traditional power relationship between management and labor. And understand: for many small business owners, that’s the only power relationship in which they currently hold the advantage.
Like I said, it’s tough running a small business. I know. You put so much equity into your business—both sweat and monetary—and yet it feels like so much of what determines success or failure is beyond your control. The economy. The competition. Consumer tastes. Disruptive technologies. Taxes and regulations. Hell, even the weather. And now the City of Seattle is going to tell you how much to pay your workers? Folks who’ve never owned a business—who’ve never hired and fired—may not understand it, but the experience often comes with a profound sense of a lack of control.
I get it. And I’m not dismissing the very real financial challenge that a $15 minimum wage would pose to some businesses. But my advice to small business owners in general is to acknowledge that at least some of your negative response to this proposal is emotional, and to trust that like most of the other challenges you face on an everyday basis, you will ultimately find a way to muddle on. In fact, experience from previous substantial minimum wage hikes tells us that that’s what most small businesses manage to do. Because as much as it doesn’t feel like it, you actually have a lot more control over the success or failure of your business than simply the power to dictate wages.