On Haircuts and Labor Market Distortions
Earlier today I went to get a haircut at Great clips, and had a fascinating conversation with my cutter. I had asked him how he likes his job, and he told me that while he loves what he does, the business has gotten considerably harder over the past few years.
Part of the problem is the wages. He told me that he makes the Californian minimum wage of $16 an hour. Even accounting for tips, that’s tough to live on in San Diego. But the real problem is that the minimum wage isn’t uniform. Under a recently signed bill, fast food workers in the Golden State must earn at least $20 an hour. So a bunch of this guy’s colleagues are quitting the business and moving across the strip mall to Jack in the Box where they can earn more money doing less skilled work.
And it gets worse. Those skills don’t come cheaply. I asked him what kind of training he needed to get in order to work for Great Clips, and he told me that California required him to complete six hundred hours in order to become a licensed hairstylist. That’s six hundred hours of unpaid effort before he ever earns his first dollar!
So there you have it. Six hundred hours of unpaid serfdom in order to earn four dollars less per hour than a burger flipper. You don’t need a PhD in economics to see what’s wrong with this picture.