Who-d a-thunk it? A $12,480 per year ‘tax’ per full-time employee ($15 minimum wage) hurts businesses?

From Mark Perry.

"The pending 67% minimum wage hike in LA (from $9 to $15 per hour by 2020), which is the same as a $6 per hour tax (or $12,480 annual tax per full-time employee and more like $13,500 per year with increased employer payroll taxes, thanks to Richard Rider in the comments below), already has business owners planning to leave, see this letter in today’s New York Times:

Effects of Minimum Wage

I will be moving my two companies out of Los Angeles when the lease is due to renew. I’ve been here since 1966, grew up in L.A., but I cannot make it anymore. When the city compels me to pay employees $15 per hour, it comes out of my pocket. Last year, my employees made more than I, the owner, did. I am still trying to pay off the line of credit that got me through the recession.

I am not a charity. I can’t raise my product prices because of pricing pressure. I can’t reduce my expenses; in fact, salaries are my greatest expense, and $15 per hour increases my expenses and reduces my profit.

Just when small-business owners were clawing out of the recession’s devastation, the L.A. City Council hits us with this. We are the ones who hire people, expand the economy, market our products or services, risk capital for research and development, and buy inventory.

As a result of this decision, L.A. will have a mass exodus of employers from the city, leaving increased unemployment, less tax revenue and increased city debt in its wake.

KEVIN McNAMEE
Woodland Hills, Calif."