For much of the country, significant minimum wage hikes are coming—at least in the areas where they haven’t happened already. Public debate on the issue in many states and cities has been reduced to a disagreement between the forces that want to keep increases to a small amount per hour and folks like Chicago’s “Fight for 15” group and new Seattle Mayor Ed Murray who propose a $15 per hour target.
People getting paid more for their work is a heartwarming notion, so it can feel pretty easy to get behind a $15 minimum wage on an emotional level. In terms of a more mathematical analysis, one sees macroeconomic cases made both for and against a high minimum wage: either that putting more money in the pockets of working people will strengthen spending and the economy or that increasing labor costs to business will result in higher unemployment.
We can talk macroeconomics all we want, but I believe most of us are going to give or withhold our support for raising the minimum wage based largely on our perceived self-interest. So with that in mind, here’s my self-interest: As a small business owner in the restaurant industry, I think a higher minimum wage is great for my business and me. Make the wage $15 an hour. Make it $20. Make it high enough that dishwashers get paid like office workers.
Here’s why. A higher minimum wage helps reduce the structural advantages large corporations have over small businesses, and that in turn helps create a context where high-quality independent businesses can thrive by overdelivering compared to our better-capitalized, but mediocre, big competitors.