Raising wage would hurt restaurants

I have tried to avoid being part of any discussion on the minimum wage, because it might be construed that I don’t pay our employees well. So, I do have to point out all of our employees at Angelo’s Restaurant make a living wage, including tipped employees and back-of-the-house employees. No one working for me makes less than $10 an hour, except hostesses, who start out at $9 and are mostly high school students. That is also a probationary wage. We are proud that we have a $1 million payroll before taxes.
However, I find it necessary to provide some facts in light of your recent editorial claiming raising the minimum wage will simply make a Big Mac cost 15 cents more. That is a false statement. Here are facts: In 2014, McDonald’s earned about $6,300 in profits per employee. If you give all those employees a raise of $2 or $3 per hour, McDonald’s breaks even without adjustments to labor or menu increases. If McDonald’s wages increase to $15 an hour, the company loses the $6,300 it gets per employee.
McDonald’s can’t raise prices to offset this. The figure is far, far higher than 15 cents for a Big Mac. If the wage is raised, they will automate and reduce employees by two to three per shift. This has already been done in a number of states with high minimum wages. Half or more of those employees will be teenagers who live at home.
In our industry, a large percentage of today’s managers, chefs and owners started out as dish or bus personnel. Currently, in our restaurant, seven line cooks and prep cooks started as bus-boys or dishwashers and several of our servers started out as hosts and bus personnel. Twenty-five percent of our population’s first job was in a restaurant.
State Sen. Scott Wagner, who is running for governor next year, proposed a commonsense minimum wage bill for Pennsylvanians that leaves the current figure intact for people aged 18 and under. We can all agree that crime, drugs, gangs, and lack of hope begin with no prospect for work.
Raising the minimum wage would not make McDonald’s charge 15 cents more for a Big Mac. That is a false statement, or, if I wished to be catchy, “fake news.” The consequences and reality are much more complicated than that misconceived notion.
Michael Passalacqua
North Franklin
Passalacqua is the owner of Angelo’s Restaurant.