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> 1/3 on wages, 1/3 on capital, 1/3 for everything else

You're criticizing businesses for following your prescription. They were 1/3-1/3-1/3. Wages went up. Quantity of labor demanded is being reduced to compensate.

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Exactly. And restaurants already operate on very tight profit margins (~5%).

If 1/3 of their cost went to labor in 2014 when the minimum wage was $10.74, the proportion will be much higher at a minimum wage of $15 in 2018.

Sure they could raise prices, but you risk pricing customers out, and as the one restaurant owner discovered, customers will still spend the same amount by ordering less or cheaper items.

>>> Sure they could raise prices, but you risk pricing customers out, and as the one restaurant owner discovered, customers will still spend the same amount by ordering less or cheaper items.

Wouldn't all their competitors face the same "problem"? So it wouldn't be a "problem" in the end?

Eating at a restaurant is a luxury not a necessity. Thus, if all the restaurants in a certain area were more expensive than what they were comfortable with, people might eat out less in general.

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