SF's Minimum Wage Tops in Nation, Concerns Chinese Biz

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Chinese businesses say San Francisco’s minimum wage bump, which starts next year, will cause economic hardships for small businesses, reports the Sing Tao Daily. The city recently became the first in the nation to boost its minimum wage above $10. Voters in the city passed a measure in 2003 to automatically increase the minimum to keep up with inflation and the cost of living.

San Francisco’s new minimum wage is more than $2 above California’s, and nearly $3 more than the working wage set by the federal government.

Although it is only a 32-cent raise – bringing the new minimum wage to $10.24, many Chinese small business owners said the raise will threaten their business survival in the city, and some are considering moving out, the newspaper reports.

Jiangwan Chan owns three bakeries and restaurants in San Francisco. He said his operational costs are 40 percent higher in the city compared to in other places. Chan plans to keep his restaurants in the city, but is considering moving his distribution centers and central kitchens elsewhere. Chan says the high minimum wage will drive businesses and jobs outside of San Francisco and thus reduces tax revenues.

Wang, the owner of a restaurant on Kearny street in Chinatown, said that an increased minimum wage will cost businesses more than just 32 cent per hour. It could heighten tensions among employees who earn different amounts, he said.

Wanchan Chiang is the owner of a San Francisco-based construction company. She said many companies will choose to shorten workers' hours or eliminate the number of employees to cover the expense of the increased minimum wage. Like Mujie Wu, the owner of Grant Palace restaurant in Chinatown, she has decided not to hire anyone outside the family.

Chinese employees, on the other hand, were happy to hear of the minimum wage boost, but also expressed some concerns. Hu, who is a new immigrant to the city, supports the higher minimum wage, but said he’s worried that employers will use this as an excuse to increase out-of-pocket healthcare premiums, reduce vacation time, or eliminate overtime, to offset those extra expenses. In such cases, his overall benefits may actually be less.

Leon Chou, director of external affairs for the SEIU United Healthcare Workers West, said the minimum wage increase could help low income and entry level workers. However, Chou also said the 32-cent per hour raise is still too little, compared to the high cost of living in San Francisco.