When the Gold Rush Ends, the Pick and Shovel Dealers Suffer Most


If you got a chuckle out of the idea of some California state employees getting temporary pay delays, all that laughter's gonna die in sorrow when you hear this tale of woe.

Because of the Golden State's overdue budget, state employees who don't have recently locked-in contracts are only receiving federal minimum wage. (Their pay will be restored once the budget is passed.) If that doesn't melt your flinty bosom, consider the plight of restaurateurs in the state capital. From the Service Employees International Union Local 1000 newsletter comes the cruel news that state employees can't keep stuffing their pieholes on $7.25 Per Hour:

"Minimum wage is going to kill us," said [Art] Vallejo, who owns three restaurants near the Capitol. "No one can afford to eat out on minimum wage … I pay my dishwashers more … I'll have to close down at least one restaurant and lay off staff because of this."

Like many local businesses, Vallejo was hanging on by a thread until the end of furloughs, hoping that business would soon bounce back.

"Furloughs hurt businesses all over Sacramento," Vallejo said. "Minimum wage will finish the job furloughs started and kill off scores of small businesses."

Minimum wage will cost the state economy $1 billion a month and cause the loss of more than 5,000 private sector jobs, according to a recently completed economic analysis.

"We all depend on state employees," said Rob Kerth of Sacramento's Midtown Business Association. "Our small businesses will be collateral damage from minimum wage."

These public sector workers and their trickle-down economic theories…