by Donna Martinez
Former Senior Writer and Editor, John Locke Foundation
You’d think government bureaucrats would understand that restaurants can’t operate without staff.
You’d think government bureaucrats would understand that when you subsidize something, you get more of it.
You’d think government bureaucrats would understand that it’s unfair to force restaurants to compete with government benefits.
You’d think. But too many bureaucrats and elected officials simply don’t get it – or simply don’t care about the perverse incentives they’ve created by piling on unemployment benefits.
One well-known Cary restaurant has given up, after trying hard to provide wages and benefits to keep up with the government. Here is the reality, as reported by Triangle Business Journal. Brigs founder David Brigham didn’t shy from explaining why the Cary location, which was owned by franchisees, closed on August 18 (emphasis is mine).
Brigham said extended federal benefits – $300 a week for people receiving state unemployment – is the reason the location’s usual staff of 30 workers had dwindled to fewer than a dozen. The federal supplement is set to expire in early September and, like other restaurants owners, Brigham hopes that will lead more people to return to work.
“It was hurtful to close a restaurant because they would rather sit at home than actually work for a living,” Brigham said, adding all Brigs employees make at least $15 an hour and receive free food during their shifts. He also said the staff was offered health benefits, but there was not enough participation so the insurer dropped the company.
Lives needlessly upended, all because the government pushed workers out of the labor market. It’s basic economics: you will get more of what you subsidize. And in this case, the government is subsidizing unemployment over work.