Trump’s Rising Wages are ‘Nightmare’ Says Restauranteur

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President Donald Trump’s low-immigration policy is spiking wages for restaurant workers in South Carolina’s Hilton Head resort before the November election, according to the Washington Post.

The Post reported the complaints of restaurateur Steve Carb who was forced to raise wages to fill just 900 of the 1,000 open jobs at his 12 restaurants in Hilton Head:

Dishwashers earn $13 an hour instead of the $10 they earned a couple of years ago. Line cooks are paid $15 to $18 an hour, instead of $13 to $15. Additional overtime costs mean tweaking the menu to stay profitable, from switching to smaller shrimp to raising the price of a plate of fish and chips by 30 cents.

“The whole island is a disaster zone right now,” said Carb, president and founder of SERG Restaurant Group. “It’s been a nightmare.”

Carb even closed off lower-performing portions of his restaurants because they did not earn enough revenue to pay prevailing wage costs. That decision suggests the supply, demand, and wages for staff have reached an “equilibrium,” showing roughly equal power between employer and employees.

Read the entire article here.

The Post also reported that tough lobbying by business groups is prompting state legislatures, as well as federal GOP and Democratic politicians, to block popular demands for mandatory use of the federal employment-verification system or E-Verify. The E-Verify system is effective at raising wages for Americans by excluding illegal immigrants, the Post reported:

“If you cut off the labor supply like these laws do, you are going to see employers get desperate when it becomes a lot more difficult to hire, and if businesses are following the law, they have to raise wages,” said Pia Orrenius, senior economist at the Dallas Fed who found that states with universal E-Verify requirements typically saw substantial reductions in the number of unauthorized workers…

Orrenius’s research has shown that E-Verify mandates resulted in increased wages for low-skilled workers born in the United States or otherwise naturalized. In the states that have mandated near-universal E-Verify, the average hourly wages of unauthorized Mexican men fell nearly 8 percent after the requirement went into effect, while wages for U.S.-born and naturalized Hispanic men rose between 7 and 9 percent.

The E-Verify system is not included in Trump’s popular immigration-law reforms — which the Washington Post repeatedly describes as “hard line.” However, E-Verify is included in Rep. Bob Goodlatte’s pending House bill as part of a package deal with farmers seeking more than one million H-2C agricultural guest-workers.

Many business-first GOP politicians — such as House Speaker Paul Ryan, North Carolina’s Sen. Thom Tillis, Wisconson’s Sen. Ron Johnson, and Maine’s Susan Collins — are very eager to drive down voters’ wages by importing more replacement workers and suspending enforcement of immigration laws.

South Carolina’s Sen. Lindsey Graham has repeatedly told reporters to their faces that he wants more cheap-labor, blue-collar workers. For example, Graham told reporters January 21 that he is trying to bring in more people for low-wage jobs:

We need more legal immigration … I don’t want green cards just for computer engineers. If you are out there working in the fields, if you are a construction worker, I want some of those people to have a way to stay here, because if you are running a business and you have a guest worker who is really good, and would add value to our country, I want them to have a chance to get a green card. I just don’t want to be a country in the future of just computer engineers or high-tech people.

Graham also helps local employers import H-2B visa-workers for jobs in the area.

Collins and Graham are routinely described as a “moderate” by the Washington Post and other publications.

Democrats also seek to raise the inflow of foreign workers — and they also create “sanctuary cities” to prevent the repatriation of the low-wage foreign workforce which provides cheap services to upper-income Democratic voters.

But the Post‘s pro-migration writers also endorse the nation’s economic policy of growth via cheap-labor immigration. In March 2018, for example, a Washington Post reporter painted a positive image of a Texas meatpacker which uses cheap-labor refugees to hold down wages:

Under Trump, the U.S. government is for the first time in decades seeking to sharply restrict legal immigration, particularly the entry of people with few job skills, saying they compete with American-born workers and drive down wages. By limiting immigration and tightening the labor pool, the administration argues, competition will increase among employers, forcing them to raise the wages of blue-collar American workers left behind in the dust of galloping global capitalism …

[Local resident Stan] Corbin voted for Trump, but he does not agree with the president when he says the country needs a merit-based immigration system favoring those with advanced skills.

“What we need is people willing to work hard, and people willing to work at JBS,” he said. “Their children will grow up to be engineers. But right now in our country, there is a great need for laborers.”

Trump’s low-immigration policies are raising wages in a variety of locations, although national data shows little overall upward movement of wages.

His policies are delivering higher wages and overtime to many employees, including African-American bakers in Chicago, Latino restaurant workers in Monterey, Calif., disabled people in Missouri, high schoolers,  the construction industry, Superbowl workers, the garment industry, and workers at small businesses, and even Warren Buffett’s railroad workers.

However, wage growth is slow, in large part, because the huge percentage of Americans who have fallen out of the workforce since 2000 prevents a nation-wide “tight labor market” where employers have to compete for employees.

This upward movement of wages, however, may accelerate this summer as voters become more confident they can raise their wages by switching jobs – and become more willing to vote against cheap-labor politicians in both parties.

A Gallup poll released May 21, shows a record 67 percent of Americans believe it is good time to find good jobs, upping marketplace pressure on employers to raise wages in the run-up to the November election. “Sixty-seven percent of Americans believe that now is a good time to find a quality job in the U.S., the highest percentage in 17 years of Gallup polling,” Gallup reported.

Read the Washington Post article here.


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