[jt240z]

Minimum wage is being raised on a state and regional basis. An answer to your question would need to be answered by someone in NY, CA or DC.

I know Baltimore is considering it as well.

The push for a Federal minimum wage my take this to another level.  I'm sure that the effect on larger operations would be minimal and there would be some weeding out of poor operations, but startups may very well be reduced as well.  If the cost of that startup is greatly increased (doubling of labor costs) then they very well  maybe much less willing to make that jump.  Quotes from Arthur Blank and Bernard Marcus seem to indicate that Home Depot could never have been started in today's environment let alone a time when even small town America has to endure a $15 pay rate for even the most mundane working position.  The rules of supply and demand would be broken.  No matter how much someone was willing to take a position for less pay, the business would be unable to provide that or violate Federal law.  Just make me wonder where this would go.

[Stevie]

I call bs. Labor is between 1 and 3% according to studies I've seen. Closer to 1 at retail and closer to 3 at wholesale. Sure it will suck at first, but they will adjust. When the minimum wage does go up (I say when because it is inevitable), it will not go up in one go.

[narvin]

What do you all think will happen to the fledgling brew industry if minimum wage goes to $15/hr?  I'd be very concerned that small breweries would suffer greatly based on the wages I see here.

Fledgling?  The amount of money poured into breweries is huge right now.  If anything there are too many breweries who don't know how to make good beer.

[brewinhard]

What do you all think will happen to the fledgling brew industry if minimum wage goes to $15/hr?  I'd be very concerned that small breweries would suffer greatly based on the wages I see here.

 If anything there are too many breweries who don't know how to make good beer.

Totally agree to an unfortunate reality. I still find it so ridiculous that so many new brewpubs/breweries are opening up that simply aren't serving good beers. Get your s**t together before even thinking about opening one please!

[narvin]

Also, if Home Depot had never been started, we'd all be better off.

[jt240z]

I call bs. Labor is between 1 and 3% according to studies I've seen. Closer to 1 at retail and closer to 3 at wholesale. Sure it will suck at first, but they will adjust. When the minimum wage does go up (I say when because it is inevitable), it will not go up in one go.

Not BS at all.  Actually labor is more in line with 10 to 20% in the retail market depending on what type of retail business you're in.  That's according to the US Department of Labor.  I own a retail business so I'm speaking from experience here.  Doubling earnings at the bottom of the pay scale will not only effect wages at that level.  Wages will rise across the board as will the costs of products and services.  The results could very well be the stifling of new startups and  provide no real improvement in the cost of living. 

Not trying to debate the merits of a higher minimum wage.  I'm trying to understand the impact of wages on a startup brewery.

[Stevie]

You phrased it from a brewers perspective, not retail.

This is getting close to politics, so I will bow out.

[jt240z]

Sorry, not trying to be political.  Was just curious about how labor costs would effect the professional brewing industry.  I have a friend who's currently a Home Brew supply company owner and he is thinking of moving into the micro brewery and wine making industry.  This would be in the Atlanta GA area.

[jt240z]

You phrased it from a brewers perspective, not retail.

This is getting close to politics, so I will bow out.

Sorry, only quoted retail numbers because that's what I know and the figure of 1% was being thrown out.  Since this thread was speaking about brewery labor costs I was more curious to how those would be impacted.  I do have a friend that's thinking of doing a startup but he's trying to capture all the costs and labor was one aspect. 

[Thirsty_Monk]

I call bs. Labor is between 1 and 3% according to studies I've seen. Closer to 1 at retail and closer to 3 at wholesale. Sure it will suck at first, but they will adjust. When the minimum wage does go up (I say when because it is inevitable), it will not go up in one go.

Steve,

My labor cost is my largest ongoing expense. I have 12 people on books.

[jt240z]

I call bs. Labor is between 1 and 3% according to studies I've seen. Closer to 1 at retail and closer to 3 at wholesale. Sure it will suck at first, but they will adjust. When the minimum wage does go up (I say when because it is inevitable), it will not go up in one go.

Steve,

My labor cost is my largest ongoing expense. I have 12 people on books.

Exactly my point.  Labor costs are a major component to ongoing expenses.  If these costs are held low because of supply and demand for the positions, then what impact will we be seeing if those costs ramp up significantly?  We're trying to project costs going on into the future and this thread has got me thinking.

[Stevie]

Leos - you're operating with tasting room employees as well, correct? Do you also self distribute? If so, your labor costs will be higher but could be seen as offset by what would be spent by a distributor or bar owner.

My google skills are failing today, so I can't find the article where I saw the above.

[Thirsty_Monk]

Leos - you're operating with tasting room employees as well, correct? Do you also self distribute? If so, your labor costs will be higher but could be seen as offset by what would be spent by a distributor or bar owner.

My google skills are failing today, so I can't find the article where I saw the above.

Yes most of my employees work as BierHall servers. I self distribute but it is in limited area.

I look at it that I need to provide for employees adequate earning potential as they could live on the pay. This way they are better employees.

On the other side there is a question. Can I afford you?  So it comes down to focus on higher margins products.

If you exhausted business earning potential and by law we are required to pay more, then it become to be a math problem. You start charging more for your product.

[majorvices]

First off, minimum wage isn't going to go to $15/hr no matter what anyone says. But it may go up to $12. Regardless most "fledgling" operations are being built on the back of owner labor (read "free" labor) and volunteer labor. Once a brewery starts to see success it should be able to find a way to balance the books to accommodate the higher pay.

I'm hoping to raise our "minimum" salary this year to $12/hr that would apply after a probationary period.

[pete b]

The problem with wages/labor costs is that they are a self fulfilling prophecy in both directions across an economy. If the mindset across an entire economy is that employers must pay as little as possible to labor to maximize profits then far fewer people are going to be able to buy their product and they will continue to feel pressure to cut costs. If the mindset is pay as much as we can afford to attract and retain great employees then more can afford the product and higher wager are feasible. The problem is that people like Leos who understand this and want to pay good wages will feel its risky if their competitors are paying less. Without intervention the economy gets stuck in the low wage/slow growth cycle.