Across the United States, consumers who opt to dine at Chipotle restaurants are likely to observe an increase in meal prices. The price hike comes courtesy of the company’s decision to raise its pay to $15 per hour, though the cost will ultimately be passed along to the consumer.
Chipotle, which is a fast-casual food chain specializing in Mexican cuisine, stated that menu prices may increase by as high as 4 percent in order to offset the negative business impacts that pay raises for its employees will entail. Per Chipotle, the $15 per hour minimum wage will take effect by the end of June.
Brian Niccol, who is the CEO of Chipotle, argued that “it made sense in this scenario” to engage in presumed investment in Chipotle employees, which would also help “get these restaurants staffed” while ensuring that a “pipeline of people” is available to support the fast-casual chain’s continued growth.
Consequently, Niccol added that it was essentially necessary to address “some pricing to cover some of that investment,” which effectively means calling for consumers to cover Chipotle’s investment.
In recent times, Democrats across the United States have vocally argued for increasing the federal minimum wage to $15 per hour, in spite of the adverse impact that such an increase has had on business operations and consumer costs.
However, while Democrats wanted a $15 per hour provision included in the recent COVID spending package, the provision ultimately was not attached to that particular spending plan.
In contrast, Republicans have, for the most part, opposed the increase in minimum wages. One reason underlying this opposition includes the increased cost to consumers, which is validated by Chipotle’s recent announcement. Moreover, other negative effects include forcing small businesses to eventually shutter, as well as killing various jobs that would have otherwise been available.
Moreover, critics of the increased minimum wage have also referenced various studies that illuminate an uncomfortable result: increased minimum wages ultimately end up harming lower-skilled workers more than anyone as a result of higher costs passed on to consumers. Thus, advocates of the $15 per hour minimum wage are ultimately pushing for a plan that harms the people they claim they want to help.
Chuck Schumer, who is a New York Democrat and the Senate Majority leader, has recently issued a call for Democrats to continue pushing for the passage of the Raise the Wage Act in the Senate. This act would require for the federal minimum wage rate to increase to $15 per hour by 2025.
Schumer argued that the increased minimum wage will “lessen the gap between the rich and poor.” He also argued that “working people” need to have a view that working hard will lead to a better life, as well as improved prospects for their children.
“When you work at subsistence wages, you can’t do it,” Schumer added.