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EDITORIAL: Restaurants closing in San Francisco after mandated wage hikes

Back in 2014, the social justice army occupying California’s Bay Area succeeded in steadily increasing San Francisco’s minimum wage to $15 an hour by 2018. The city’s Office of Economic Analysis predicted the move would reduce job opportunities and “tend to contract the city’s economy,” the San Francisco Chronicle reported.

More than two years into the progressive experiment, the results have been predictable, particularly in the restaurant industry. “San Francisco’s ever-rising minimum wage … has restaurant owners asking for the check,” wrote Michael Saltsman of the Employment Policies Institute in a Wall Street Journal commentary this week.

Mr. Saltsman notes that one food-oriented publication described the increasing number of restaurant closures in the city as a “death march.”

Yes, the restaurant game is competitive and capital intensive. Startups have a low chance of long-term success. But a recent paper by researchers at the Harvard Business School and Mathematica Policy Research found that higher minimum wages translate into higher failure rates for restaurants, particular lower-end establishments.

“It’s really extraordinarily difficult to get from that to the idea that there will be no unemployment effect from a higher minimum wage,” wrote Tim Worstall of London’s Adam Smith Institute in Forbes. “But there are a still people out there claiming it for some unknown reason.”

Unfortunately, some of those people serve in the Nevada Legislature. Senate Bill 106 seeks to accelerate increases in the state’s minimum wage, which is already tied to inflation. Progressive lawmakers such as state Sen. Yvanna Cancela, D-Venezuela, continue to insist that government central planners must keep arbitrarily hiking wage floors in an elusive quest for “fairness.”

But what they’re really doing is outlawing more and more jobs that provide training and opportunity for younger and low-skilled workers.

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