After 18 years in business, San Francisco bookstore Borderlands Books announced it will close in March, despite having its “best year” in 2014.
Why? According to the bookstore, it’s because of San Francisco’s upcoming minimum wage hike.
We’re tremendously sorry to announce that Borderlands Books will be closing in March. More info: http://t.co/hKZA1tTbsb
— Borderlands Books (@borderlands_sf) February 1, 2015
Last year, San Francisco voters approved raising the city’s minimum wage to $15 an hour by 2018, a wage Borderlands can’t afford to pay.
“Although all of us at Borderlands support the concept of a living wage in [principle] and we believe that it’s possible that the new law will be good for San Francisco—Borderlands Books as it exists is not a financially viable business if subject to that minimum wage. Consequently we will be closing our doors no later than March 31,” reads the statement.
Borderlands Books owner Alan Beatts doesn’t see a reason to delay the inevitable.
Beatts writes that a $15 wage would result in a 39 percent increase in wages—an expense he would have to make up elsewhere.
But he can’t. Unlike other businesses that can raise the prices of their goods and services in the face of a higher wage, bookstores have to grapple with the fact that books have a fixed price.
“All that I’ll say about increasing our prices is that it’s already hard to get people to pay the publisher’s list price for a book. How often have I heard people say, ‘I’ll just get it cheaper on Amazon’? I don’t think that enough people to keep us in business would pay a 10 [percent] or 15 percent surcharge to buy books at Borderlands,” writes Beatts.
James Sherk, senior policy analyst in labor economics at The Heritage Foundation, said minimum wage hikes result in job losses.
“The true minimum wage remains $0.00 an hour. Businesses will not pay workers more than the value they produce,” said Sherk. “A $15 minimum wage forbids anyone whose labor produces less than that from working—as this bookstores’ employees learned the hard way.”