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Yesterday I came across a New Zealand “business owner” who tweeted support for the increase in the minimum wage and declared that they are already paying their employees a ” living wage.”

Frustrated yesterday by ACTs tweet today saying that the raising of the minimum wage is detrimental to businesses. I firmly believe that if you can’t afford to pay your staff enough to live then you shouldn’t be employing staff. I’ve paid a living wage since my business began.

Twitter

Let’s look at her “business”:

  1. She teaches swimming using the local school’s pool.
  2. The pool and changing facilities received a massive upgrade with most building materials and labour was provided free by Bunnings and another company.
  3. The local council and Community Trust provided a “significant” amount of the funding.
  4. Members of a Waterpolo club volunteered time as well.

First: Great community spirit, and well done to all involved. Seems like a nice bunch of people

My point is that it is not a real stand-alone business, it is, in reality, an NGO run as a business.
Normal (and most by far) businesses:

  • Do not have access to facilities provided at below actual real cost (long term) (no capital cost etc)
  • Do not have access to free start-up funding
  • Do not have access to free labour
  • Have barriers to entry to industry: need a pool for starters
  • Do not have nil international competition
  • Do not have a lack of local neighbourhood competition…which relates to needing a pool
  • Do not have competition that is reducing (ie the schools themselves are closing/not using pools)

I also suspect that there is no capital gain for the business, as facilities (ie the major assets) are owned by the school/community.

Compare this so-called business with a coffee shop, a restaurant a bar or a clothing shop.

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