I've been doing this for decades now... I've had to deal with a number of minimum wage increases. The first reaction we have is to slim down, and get rid of lower performing employees. The second is to raise prices. In a steady-state dream world we will always be at maximum efficiency and would only raise prices because everyone would be necessary. But we are fairly large, and unproductive people come and go.
But in the long run what happens, prices go up, cost of living goes up, taxes go up along with the deadweight losses therein... so purchasing power of a minimum wage worker actually decreases despite being paid more.
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