Minimum wage, maximum sorrow for San Francisco bookstores

Minimum wage, maximum sorrow for San Francisco bookstores » AEI | Carpe Diem Blog » AEIdeas
Proponents of the minimum wage law government-mandated wage floor that guarantees reduced employment opportunities for America’s teenagers and low-skilled workers can’t possibly anticipate in advance all of the adverse and unintended consequences of artificially raising wages for unskilled and low-skilled workers. 

As an example of an adverse and unintended consequences that the citizenry of San Francisco didn’t anticipate last November when they overwhelmingly voted to increase the city’s minimum wage to $15 per hour by 2018, a San Francisco book store is closing. 

Reason? 

There’s a limit to how much a bookstore can increase book prices to offset higher labor costs because the publisher sets the list price of the book and it’s printed on the book cover.

From the website of Borderlands Books:

Borderlands is closing.

In 18 years of business, Borderlands has faced a number of challenges. The first and clearest was in 2000, when our landlord increased our rent by 100% and we had to move to our current location on Valencia Street. The steady movement towards online shopping, mostly with Amazon, has taken a steady toll on bookstores throughout the world and Borderlands was no exception. After that and related to it, has been the shift towards ebooks and electronic reading devices. And finally the Great Recession of 2009 hit us very hard, especially since we had just opened a new aspect to the business in the form of our cafe.

But, through all those challenges, we’ve managed to find a way forward and 2014 was the best year we’ve ever had. Overall, Borderlands has managed to defeat every problem that has come our way. At the beginning of 2014, the future of the business looked, if not rosy, at least stable and very positive. We were not in debt, sales were meeting expenses and even allowing a small profit, and, perhaps most importantly, the staff and procedures at both the bookstore and the cafe were well established and working smoothly.

So it fills us with sorrow and horror to say that we will be closing very soon.

In November, San Francisco voters overwhelmingly passed a measure that will increase the minimum wage within the city to $15 per hour by 2018. Although all of us at Borderlands support the concept of a living wage in principal 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 31st.