By The Ethnic Community Coalition
Although Seattle’s proposed $15/hour minimum wage increase has been publicly debated since last fall, we local ethnic and immigrant small business owners have just begun to realize the negative impact the wage hike will have on our businesses and on our employees. For months, we tried to ignore it. In the meantime, groups like $15 Now and the labor unions spoke on behalf of our traditionally quiet and underrepresented communities.
From left: Hector Pang, Zane Fitch, David Leong, Lawrence Pang, Julie Pham, Yen Lam, and Susanna Tran. (Photo by Assunta Ng/NWAW)
These groups argue Seattle’s proposed 61 percent minimum wage increase will bring large-scale economic benefits to over 100,000 low-wage workers, many of whom are women and minorities. On the surface, the wage increase will put more money into our pockets.
But the proposed hike also will have many unintended consequences for our small businesses.
First, we would need to reduce our work force and hire only highly skilled employees. Over 10 percent of low-wage workers in Seattle do not speak English well. Right now, we hire many recent immigrants who would not likely be able to find other work in such a competitive market. At $15/hour, we would have to reduce our staff and only hire skilled, experienced workers who speak English fluently.
Second, we would upgrade our technology and use machines to do some work formerly done by hand. For example, the people you see packing produce at Lam’s Seafood in Little Saigon would be replaced by automation.
Third, we would halt plans to expand our businesses in Seattle. Ethnic communities have been moving outside Seattle for years because of the city’s rising prices. This proposal would accelerate the migration of minorities from Seattle to the surrounding areas, a trend shown in the 2010 Census.
Fourth, we would have to raise prices on an already price-sensitive community. Tam Nguyen of Tamarind Tree estimated he would pay $45,500 each month in additional wages and taxes. “Even with a 30 percent price increase, how can I afford that?” said Nguyen. Washington Restaurant Association’s survey of 400 restaurant owners showed the wage hike would mean 82 percent of restaurants would raise prices, 69 percent would lay off some staff, and 45 percent would close business, declare bankruptcy, or close a location.
Ethnic restaurant owners and shopkeepers, such as Tamarind Tree and Lam’s Seafood, will be disproportionately impacted. The University of Washington research commissioned by the city’s Income Inequality Advisory Committee reported most jobs that pay less than $15/hour are in the accommodation and food industry (63 percent) and in retail trade (48 percent). According to the 2007 U.S. Census survey of business owners, Asians and Asian Americans own a 24 percent share of the accommodation and food industry market in Seattle and 19 percent of retail trade. This is relatively high, considering Asians comprise less than 14 percent of the city’s population.
Since wage compression will likely result, it is still unclear to what degree the income gap between minorities and whites will close. Moreover, the extra income will not necessarily stay in Seattle to stimulate its economy — 40 percent of low-wage workers in Seattle live outside the city.
With all these reasons, why did we ethnic small business owners wait until now to rally against this proposed wage hike?
Because we were afraid to talk openly with each other and with our employees — it’s not in our culture to make waves.
We feared we would be accused of not wanting to improve the lives of our workers. We feared being bullied and boycotted.
Our fear clouded our ability to use the greatest weapon this country can give us: our voice.
Now, we’ve come together to say “no” to the proposed $15/hour minimum wage that would become effective next January. We need to determine a sustainable approach to economic growth that will be a win-win for both employees and employers, and that will respect the diversity of our city. (end)
Zane Fitch, Day Spring & Fitch Funeral Home
Taylor Hoang, Pho Cyclo Cafe
Yen Lam, Lam’s Seafood
David Leong, Acquabar
Lawrence Pang, Greater Seattle Chinese Chamber
Julie Pham, Northwest Vietnamese News
Angela Shen, Savour Seattle Tours
Susanna Tran, Tony’s Bakery & West Coast Commercial Realty
@emanon71
I think you’re missing the point, and getting lost in the micro-level details. At the macro-level, the details and overall effects on the economy are easy to understand. People with extra money tend to employ other people. Artificial increases of “mandated” wages that must be paid past the economic realities of supply and demand (the extra money) and sacrifices will have to be made to maintain profitability. Make cuts in the wrong places, and the ability to remain profitable is lost no matter what you do.
In short, a company employs 35 people. 15 must be cut to maintain profitability. 20 people get a raise at the expense of 15 now being unemployed. Those 15 now leave the local economy as both producers and consumers, and now must rely on government handouts to live, which further burdens the local social resources, requiring higher taxes on everyone, including the 20 that just got a raise.
Effectively, we have enabled 20 families to buy an extra pair of shoes and eat out a bit more often (and pay more in taxes), at the expense of 15 families now not even able to afford socks, and now eating on food stamps.
You have to ask yourself, If 15 is so great, why only 15 and not 25 or 35 an hour? Because the politicians are fully aware there will be economic side effects, and 25 would make the effects far more visible to “we the people”. They are currently gambling the PR gains for the party will outweigh the economic loss, and the effects will be “quiet” enough not to cause a public outcry.
People keep thinking this topic is a “rich vs. poor” argument, and It’s simply not. That which impacts those who employ will impact those who are employed double fold. The “class” argument is just the emotional shroud used to blind people to bad policy and dangerous economics for the payoff of feel good legislation and political expediency. It’s a lazy approach to a complicated problem that creates more net loss than gain.
I think it is important to acknowledge the class warfare within the Asian population. According to the US census when Asians are broken down by groups some Asian groups are in a higher income bracket than compared to the median income of Caucasians and the US in general. Japanese, Chinese, Filipinos, and Indians have a higher income than the national average while Koreans are about equal to and all other Asian groups (Vietnamese, Cambodian, Laotian, Hmong, among others) have a lower income. Of course, there are going to be outliers but a letter like this implies that the minimum wage increase would be damaging to all Asians when in reality it is often times only damaging to wealthier Asians. This is not to say that there is anything wrong with working hard and having a successful business. This is the American dream come true for many hard working immigrants and their children but in the process of supporting policies, laws, and candidates that benefit the wealthier Asian class low income Asian groups continue to get overlooked and hurt by that support. Stereotypes, such as that of the model minority does not help either as it causes lawmakers to pay less attention to low income Asians, depriving them of much needed social services. It would be too simple to say that the reason Asians have not spoken out on this topic is because of the traditional stereotype of not making waves. I have no doubt that this is a factor but class is a factor as well and the Asian community cannot absolve themselves of supporting policies and laws that benefit their immediate families but not the Asian community as a whole, especially the least of those. This letter does not represent them. Class must be considered when exploring why Asians tend to vote more conservatively as compared to other ethnic groups, especially on fiscal issues. Class must be brought into any conversation on race, including conversations within races. I would be curious of those who support this letter how many of them are struggling to make ends meet like so many Asians are. How many of them make less than a figure close to a quarter of a million per year (or under $200,000). If we were to take a poll asking Asians who are financially struggling paycheck to paycheck and Asians who are not, who would support the minimum wage increase and who wouldn’t? I am one Asian in the wealthier bracket. I am self employed. I know some policies and laws that benefit the poor in my community will hurt me. I may not be able to buy the house, car, or shoes I want. I may not be able to travel to my first choice destination. But I also know that the increase in minimum wage will help my community. They will be able to make the next rent even if they don’t live in the house they want. They will be able to pay for the bus even if they can’t buy a car. They will be able to buy new shoes when the ones they are wearing are worn and tattered. They will be able to take a few days off even if they can’t travel to an exotic place or visit their homeland. They will have a shot at the American dream already achieved by so many of us. I hope for the day when we can think of ourselves as a global community that cares for one another, especially the least among us, expressed not by rhetoric but by policies and votes. If you dare to hope the same then I plead with my own community to let it start with us.
Spread the word and get the idiots in the Seattle city council and the mayor out of their office. Tell them if they feel so badly for the workers, they can open their own businesses and hire all the workers and pay them more.
The politicians always want to tell everyone else how to run their business and their life but want to do it with other people’s money and not their own!
I like this article! I will post it to my Facebook page and show it to other people who support the increase of the minimum wage. One cannot legislate prosperity.
Had you spoken up, it would have done you no good. No one on the city council has any knowledge or experience in business. They think they can waive the laws of economics by the stroke of a pen. Next they will propose a reduction in gravity to solve the “obesity epidemic”. I wish you good luck.