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Hi Nicholas,

I agree with you if the increase in minimum wage is slight or merely indexed to inflation perhaps. But if we're talking about a major leap--like to a true living wage--then some small business owners would take up some of the slack themselves--at least for a while.

Also, to get back to your argument: one thing to consider is that it can be a pain and a lot of work to grow a business. For various reasons opportunity cost isn't always a clear-cut issue.

For instance, what if you have a crew of workers in a service industry like lawn care or window-cleaning. Is your time always best spent going out to get new customers or doing expansionary activities? Not necessarily when you consider the overhead you may incur and capital outlay that may be required, and the fact that with more employees come more headaches too. Maybe for a while you would be better off trying to find ways to streamline your current operation, and increase its profitability.

Also, some businesses you can only grow so large before it requires that you undertake a major overhaul in your approach and structure if you wish to expand much further.

If you don't want to go deeply in debt and prefer instead a pay-as-you-go approach, there are additional limits to the speed at which you can expand. When I had a service busines that was how I operated.

All in all you make some good points and I'm just trying to show that it isn't completely cut-and-dried. Also I hope we haven't been talking past each other because of the difference in effect of merely raising the minimum wage to an index, or raising it to a "true" living wage.

An entrepreneur who does nothing but seek better opportunities (and perhaps clients as well;-)) had better have quite the cash cow business or a lot of financing/backing as a general rule. If you are in a lower profit margin type of business or a very labor-intensive business, I don't think the owner can always do things that way--at least not until he passes the invisible boundary from start-up/small to very well-established and some serious size. And every time you expand you have to keep hiring and eventually that means hiring managers and people to manage your managers or foremen, etc. Again there are often limits to the speed at which you can expand soundly unless you made a high initial investment in the business or are willing to go heavily in debt.

Thanks for your thoughts; I don't think I disagree with you as much as it might sound.