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San Francisco Minimum Wage Hike Kills Another Small Business

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A bookstore is the latest San Francisco business to close as a result of the newly enacted $15 minimum wage.

Alan Beatts, owner of Borderlands, did all he could to keep his 18-year-old bookstore open, but after a series of challenges along with the higher minimum wage, he had no choice but to close. Beatts isn’t bitter though, he sees the increased wages as great for workers even if his store was unable to make the change.

Back in November, residents of the city voted to increase the minimum wage gradually to $15 an hour over the course of three years. Though the wage hike was designed to help address income inequality, several businesses have already had to close.

“I certainly think there is a benefit to a higher minimum wage,” Beatts told The Daily Caller News Foundation.

“People categorize the minimum wage increase as the straw that broke the camel’s back,” Beatts noted. “That’s not actually true.”

Beatts says the minimum wage increase was just one of many factors the store was unable to overcome such as increased rent, moving their location and having to compete with online giants like Amazon.

“I think it will be a major challenge for any small retail business,” Beatts notes, though he thinks the larger stores and businesses will be able to adjust just fine.

When it came time to break the news to his six employees, Beatts decided it was best to talk with each of them individually. He knew it would be tough because his employees love books, love the written word and to them, it was more than just a job.

“I spoke to each of my employees individually,” Beatts notes. “The typical reaction was shock and sadness.”

Michael Saltsman, the research director at the Employment Policies Institute, fears that more is to come as a result of the wage increase.

“We’re probably just seeing the beginning of this,” Saltsman told TheDCNF. “In a relatively short period of time it’s concerning we have a couple stories like these popup.”

“What we do know is San Francisco is an expensive place to do business,” Saltsman also noted. “It’s pretty clear that if this minimum wage didn’t go up, this business would still be open.”

Saltsman is optimistic though that stories like these will prompt a more thoughtful public debate on the consequences of raising the minimum wage in more progressively minded cities like San Francisco.

The official close date of the store is not yet known but will depend on how quickly they can sell inventory. At the latest though, it will be open until the end of March.

Follow Connor on Twitter

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