Starbucks CEO Comes Out In Favor Of A Minimum Wage Increase

[ProSense]

Starbucks CEO Comes Out In Favor Of A Minimum Wage Increase

By Annie-Rose Strasser

Howard Schultz, the Chief Executive Officer of Starbucks, has added another pro-worker notch to his belt: support for increasing the minimum wage.

Schultz already has a relatively good reputation on workers’ issues; his company offers health care to all of its employees, and doesn’t mind spending more on health care than on coffee. Starbucks also launched, in 2011, a a pro-jobs effort where patrons could donate to a loan program that helps small businesses keep jobs and hire...In an interview with CNBC, Schultz said, “I am a supporter of the minimum wage going up“:

Howard Schultz, the head of the global coffee giant, told CNBC Wednesday that “the minimum wage issue is a double-edged sword,” because while boosting it would mean higher wages for workers, it may also discourage businesses from hiring more people.

“On balance, I am a supporter of the minimum wage going up,” he said. “We’ve got to be very careful what we wish for because some employers — and there could be a lot of them — will be scared away from hiring new people or creating incremental hours for part-time people as a result of that wage going up.”

Last week, House Republicans voted down a proposal pushed by Minority Leader Nancy Pelosi (D-CA) that would have raised the minimum wage to $10.10 an hour. The Senate has made no motions to improve the wage. Sen. Elizabeth Warren (D-MA), however, has pointed out that the minimum wage would be $22 an hour if it had been adjusted for inflation and worker productivity. Indexed to inflation alone, it would not stand at $10.40.

Schultz is joined in his support for an increased minimum wage by Costco CEO Craig Jelinek. Jelinek, however, has said he would actually like to see it rise higher than $10 an hour.

http://thinkprogress.org/economy/2013/03/21/1755231/starbucks-ceo-minimum-wage/

[Sherman A1]

1. Good news

of course begging the question of starting pay at Starbucks, but I assume that would vary by market to a degree.

[ProSense]

2. Raising the minimum wage should be a top priority

It's one of the fastest ways to begin to address income inequality.

[laundry_queen]

3. He's smart and here's why

when the minimum wage goes up, it won't make minimum wage workers suddenly go out and buy large purchases. They are living pretty bare bones right now, but with a small increase in income, they will start making smaller purchases that make themselves 'belong' and feel better overall. They will treat themselves with small things (there is a name for this effect on the economy but the name escapes me at the moment), like a fast food meal, a 6 pack of beer, or...fancy coffees. Lest anyone think his support for a raise in minimum wages is entirely selfless this will probably benefit Starbucks more in sales than it will hurt them in higher wages. I'm sure he's looked at the numbers and projections. So he's probably not just some social activist as much as he is a smart business person.