If you live in North Vancouver you may remember the Irly Bird in Lynn Valley. You know, the little hardware store behind the garden centre? When completing home maintenance, nearly every Lynn Valley resident stopped at this location to get just one or two items they needed.
Of course, if they needed more, or something significant then most (not all) would go to the bottom of the hill and get what they needed from the much larger hardware store that had more selection and lower prices.
The Irly Bird employed many local Argyle Secondary School kids as cashiers, shelf stockers, or in the lumber yard. They knew where everything was if you asked – unless they were new. There was a lot of turnover. There was typically a manager on duty – often one of the employees that grew out of their position after a few years. They also hired some middle-age employees because they had to be open during school hours too. It was a second job for some of these.
They lived nearby, so picking up shifts wasn’t a big deal. On an average busy day, they could have hundreds of customers stopping in to buy a 2×4, or a box of nails, or a new caulking gun. You’d be lucky to get one of the 12 parking spots. On a slow day in the winter, it would be empty. One person stopping in at a time.
Then they closed. They couldn’t compete with Rona and Home Depot at the bottom of the hill. Not simply because of prices (they were always more expensive, but also carried more locally produced brands at higher quality). What happened here was a side-effect of the minimum wage, which was continually rising. This didn’t matter much for the big stores – they were going to be open no matter what, and could go to a skeleton staff if needed during slow times of the day.
But the small stores suffered by needing to keep at least a few staff on in order to stay open. So they started to close more frequently. People learned they’re not always open, so instead of going there, they would stop at the big store before coming home. Then, of course, Irly Bird had to close for good.
This isn’t a story about a poor business that got beaten out by bigger competition. This is a story about everyone in Lynn Valley now paying a significant price so that a small number of people can make an extra few thousand dollars a year.
Today, everyone must drive to the bottom of the hill to get to a hardware store – even when you only need one single damn bolt so you can proceed with the next part of your project. This is an added gas cost for everyone. Maybe only $3 per trip, but it adds up to tens of thousands for all of us in a year. This only adds to the already bad traffic situation, because there’s now dozens of trips across Highway 1 to get to the store and back.
This situation should elicit some questions, like:
How much is spent in gasoline?
What is the productivity cost to the Lynn Valley residents and others stuck in traffic due to the extra traveling time?
How much does it cost the city to maintain the roads incrementally more?
How many jobs were lost by Irly Bird employees?
How are the future earnings of the teenage employees that no longer have work experience affected?
How many jobs were lost by the producers of goods that only Irly Bird stores carried and didn’t have vendor agreements with the large retailers – who imported from China instead?
What is the total value of all the lost jobs, job experience, income, and extra costs associated with increased travel?What would that money have been spent on otherwise?How many jobs would that have created?What would those hypothetical job-holders have spent their money on and so on…?
Irly Bird is not the only store to have closed and business picked up by larger competitors, due to the same increase in the minimum wage. Multiply the answers to all the above for Radio Shack, Time Out Sports, Hockey Cards Plus, and numerous other retailers I used to frequent in Lynn Valley. There’s many more.
The minimum wage is only one example of a government regulation that has such a gigantic impact on how various participants in the market compete for resources (in this case, labour resources). Multiply the effect of this with those other regulations having similar effects and the damage to our economy and society is gigantic.