Strategy consulting case interview: Is a $20 minimum wage good policy? (w/ BCG Consultants)

We've got another fresh business problem for Rocket Blocks experts to solve in today's mock interview. Today's case

asks an important public policy question and has candidates thinking about not just the revenue impacts, but also the impacts to multiple stakeholders for a big change the state is thinking about

policy. As a reminder, if you want to

policy. As a reminder, if you want to get better at solving complicated questions, you need to be practicing actively and deliberately. At the very least, pause this video each time a question is asked to try your own answer

out loud. And if you're feeling brave,

out loud. And if you're feeling brave, you can drop your sample structure into the comments and we'll leave some feedback on the first few folks who do so. Good luck and have fun casing.

so. Good luck and have fun casing.

>> Our client is a large US state and they are considering raising the minimum wage for fast food workers to $20 per hour, similar to California's recent policy

change. How would you help this state

change. How would you help this state decide if raising the minimum wage is the right decision? as context. Your

client is a senior adviser to the governor who wants to understand what happened in California and whether implementing a similar policy would be beneficial overall.

You have access to data on how wages, employment, hours worked, turnover, prices, and franchise performance have changed in California after the wage hike.

>> Great. Okay. Seems like an interesting case. Um, want to make sure I understood

case. Um, want to make sure I understood everything you said correctly. So, our

client is a large US state who is considering raising their minimum wage for fast food workers to $20 an hour, similar to what California recently did.

And so, they've hired us to help them understand if if raising the minimum wage in their state's the right decision. Um, our client specifically is

decision. Um, our client specifically is a senior adviser to the governor who wants to understand what happened in California and whether implementing this policy would be beneficial overall for

us. Um, and then we have access to it

us. Um, and then we have access to it sounds like all the macro data um to help make this decision. So, employment

data, price data, etc. Did I understand everything correctly?

>> That's correct.

>> Awesome. Okay. Um, couple clarifying questions before we jump in here. Um,

just curious what the main goal of the governor's office is with implementing this policy or considering this policy.

um like is there an economic goal, a social goal? What's kind of the ambition

social goal? What's kind of the ambition behind this potentially proposing this?

>> So the governor wants to improve worker welfare and incomes for low-wage workers. At the same time, also wants to

workers. At the same time, also wants to understand the economic and political trade-offs such as potential job losses, business closures, and price increases

just to see if the policy would help or hurt the overall state economy.

Got it. So, it sounds like it's a really economic goal that they just want to make sure works politically as well. Um,

so I think understanding kind of the economic pros and cons of of implementing this will be crucial. Um,

>> and then, you know, US states, it's they're they're quite different. And so,

I'm curious, is our state very similar to California in terms of things like cost of living, current wages, etc.? So,

we can assume like it'd be a similar scale to go to $20 an hour or we I don't know like um Wisconsin where minimum wage might be already baseline lower

than California. Like how does our state

than California. Like how does our state compare to California on kind of key KPIs?

>> Yeah. So, our state's pre-policy fast food wage is $12 an hour. So,

significantly higher than the the nationwide um minimum wage, the federal minimum wage. and our cost of living

minimum wage. and our cost of living index is 105 um versus 150 in California. So quite a bit lower. This means the same $20 wage

bit lower. This means the same $20 wage would represent a much larger relative increase and could have bigger impacts on business costs.

>> Okay, helpful context. So potentially a different decision than than what California was making here. Um okay, is it okay if I just take a few moments to to gather my thoughts before we dive

into the problem? Yeah, please do.

>> Fantastic.

Okay. Um, so in order to sort of solve this problem, I think there's two main buckets of of factors or I want to take a two-pronged approach of viewing this problem. One is starting with kind of

problem. One is starting with kind of macro factors and then the second I'm just going to call micro um which is the day-to-day business um employees, how is

it going to impact them? But the first bucket here of macro things I want to understand within this are just like a economic impacts and b kind of government or political considerations.

So within the economic impact um considerations I want to understand you know what is our state's GDP growing at today? What's unemployment like today?

today? What's unemployment like today?

What's we know the average wage growth?

You stated that but kind of just get a baseline of how is our state's economy performing today? um and if there are

performing today? um and if there are any red or yellow flags that we need to try to improve and how this policy could potentially impact those indicators. Um

I want to look at as well how California's economy was impacted by this change. So like how did

this change. So like how did unemployment change? How did um business

unemployment change? How did um business openings and closures change for example? So just understanding like the

example? So just understanding like the before and after the implementation in California, how did their economy change because that would give us an estimate of how this could impact us. So those

are like the economic factors I would want to understand. And then bucket B just kind of political government factors. I think I want to know do

factors. I think I want to know do voters want this in our state? Like is

this something that the majority of the state um is asking for? It sounds like cost of living is much lower in California, but I think there is just a general >> global upcourse. it's not even America

only and cost of living getting out of hand um with rising housing costs, education costs, healthcare, etc. And so I would imagine there's support for something like this, but maybe lesser

than California if our cost of living isn't as high. Um and then things like the likelihood of this getting approval in our state's legislature. Um is it

going to have buyin from from our state, for example? Is it a Republican Democrat

for example? Is it a Republican Democrat state? I'd imagine more democratic

state? I'd imagine more democratic leaning state this would be more likely to get approval and so before put a bunch of work into it just understand like the possibility of this getting approved and then other things are just

like the state budget and tax implications. So, um, like if we raise

implications. So, um, like if we raise the minimum wage, you'd think, okay, we get more, uh, income tax on that if wages just go up, but is there going to

be a decline in employment and then we have to pay more unemployment benefits, etc. or something like [clears throat] like what's the impact going to be on our state's budget? Because I think that's something we would have to

consider. Um, so that's like the macro

consider. Um, so that's like the macro factors I'd want to look at when making this decision. And then micro factors,

this decision. And then micro factors, which kind of relate to macro, but I think I'd want to understand how this is going to impact employees dayto-day. Are they

going to be asked to go part-time instead of full-time because they don't employers don't want to have to pay benefits anymore? Are employees going to

benefits anymore? Are employees going to get cut back on hours? Um, are there going to be layoffs? So, are people going to try to just have fewer employees? Like, what are what's going

employees? Like, what are what's going to be the impact or the estimated impact on employees daytoday? Um, and if we don't think it's going to be that big of

an impact, like they're going to just do their same job, um, their employment levels are going to stay the same at the same wages or at higher wages, we'd probably want to move forward with this.

And then I'd also want to look at just employers, so businesses like their ability to afford this. Like what is the average profit margin of small businesses or fast food restaurants in

our state? like how much wiggle room do

our state? like how much wiggle room do they have to um absorb this cost? What's

their ability to pass on price increases? Um is it a price sensitive

increases? Um is it a price sensitive insensitive customer base? Um and then just like that informs the closure risk I think like is there going to be a risk closure

risk or layoff risk. So those are like the different factors I would want to look at. In terms of prioritization, I'd

look at. In terms of prioritization, I'd probably want to start with this like bucket one of macroeconomic indicators and getting a sense of um maybe our

state's KPIs or how this impacted California would be like a couple potential places to start. And so

curious if you have any data on that.

>> Here's some feedback from Maddie.

Especially when the case is not just a traditional client thinking about profitability or growth, getting clear on what the goal is can be super helpful. One of the number one tips in

helpful. One of the number one tips in case prep is to not just go around memorizing frameworks. One of the

memorizing frameworks. One of the reasons is that there are literally infinite kinds of cases you might come across in your interview and you need to be prepared for one or more cases where you have to come up with something from

first principles. Abby does well here to

first principles. Abby does well here to create a straightforward framework that captures all the angles up for consideration with this move. Abby does

well to reference important outside information like how is our state more or less like California? Can we actually do this? This helps illustrate that she

do this? This helps illustrate that she is trying to solve the problem for real.

>> It's a great great idea. So, we're going to go in a little bit of a different direction. Let's let's kind of look at

direction. Let's let's kind of look at um workers. So, um we're going to look

um workers. So, um we're going to look at a little bit of a before and after.

Let me go ahead and share my screen. So,

we've got data from California um based off of 2023 and 2024. So, before and after the uh fast food wage increase, what do you observe from this chart and

what are the key implications for workers?

>> Yeah. So basically I see some key metrics of hourly wage, total workers, average weekly hours per work per employee, and then we have it

pre-increase and then post increase and how they compare. Um just going to take a few moments to to read the data here.

>> Okay.

>> Yeah. So, I guess two things really jump out to me is is one, the wage increase for California went from 16 to $20, which was much lower than our 12 to 20

that you mentioned at the beginning. So,

the increase for California was like a 25% bump. Um, and so for us it would be

bump. Um, and so for us it would be closer to like a 100% bump almost. And

so that's just something to be aware of.

The second thing that jumps out is just how this impacted um total workers and average hours worked per employee. So it

looks like total number of fast food workers went down by about 40,000. So um

that would be just shy of 10%. So the

number of workers decreased less than the wage increase offset which is a positive sign. But also hours worked per

positive sign. But also hours worked per employee went down. So people were just having their their employees work less to potentially save save money. I think

>> overall it seems like we have some um multiple effects that are ripple effects of the increasing wage. Um

but I think it's a positive signal that the hourly wage went up by 25% but number of workers only dropped less than

10%. Um, and so right now it seems like

10%. Um, and so right now it seems like this might be a good thing to to push forward based on on this data alone.

>> Yep. Can you go ahead and estimate the total weekly wages paid to fast food workers in California before and after and then let me know if total worker

income has increased or decreased?

>> Got it. Okay. So, total uh weekly income before and after and they want to know if it increased or decreased. So we just need

to compare total weekly income before and total weekly after. So um to do this calculation I'm going to take the average hourly wage

times number of workers times um average hours per worker per week. Uh

so wage times number of workers times hours. And I'm going to do that for both

hours. And I'm going to do that for both pre and post. So pre that would be the $16 hourly wage times the 500k workers times the 32

hours per week. Um so I'm going to multiply uh 16 by 32

>> which is going to be 16^ squar * 2. So

that's like 250 * 2. So 500 * 500k um 500 * 500k would be starting with 500

* 5 would be 20 um 500. So that'd be 2.5 million um time another 100. So it' be

about 250 millionish dollars before. Um and then after I would do the same calculation

which would be 20 um average $20 per hour times 460k workers times >> 30

>> hours per week. Um so that would be I'm going to take 20 * 30 because it's easier. So that' be 600. So then we just

easier. So that' be 600. So then we just do 600 * 460.

um 600 * 460 would be I'm going to first take 46 * 6. That's going to get me to

um 276.

Um so 276 and I just have to add my zeros. So that would be

zeros. So that would be um I add six zeros. So $276 million. So the

difference here is about $25 million between the two. So total and it went up. So total wages went up about 25

up. So total wages went up about 25 million after the increase here. And so

even though number of workers went down in average hourly workers per employee, it seems like the net benefit of this to the economy so to speak is is an extra

$25 million of annual or of weekly wages. um fast food sector, which is a

wages. um fast food sector, which is a positive.

>> Yeah. Okay. Really helpful. Thank you.

>> Here's some feedback from Maddie. It's

interesting that Aby's first insight includes information that's not on the chart. In this case, that our client's

chart. In this case, that our client's states relative minimum wage jump is higher than California's. She's taking

the new information that's being displayed and immediately organizing it and contextualizing it with the existing information that we have from the case and the client.

Abby does a good job to frame the new information in the context of the decision to be made. The question of the case is straightforward. Should we raise the minimum wage or not? And she ends her analysis here with a clear, this

data says we should push for an increase.

Aby's math setup and execution are solid. She uses shortcuts to quickly get

solid. She uses shortcuts to quickly get to an approximate answer that'll help drive the case forward.

>> So, moving on.

We now have some data um from California um that shows what's going on in the fast food industry. So, let me go ahead and share my screen with you

again. What does this data suggest about

again. What does this data suggest about the impact on businesses and consumers now that we've seen some data on the impact on workers?

Yeah. So I see average meal price, total fast food sales in dollar billions, and then number of fast food franchises in

23 and 24, which based on the previous chart was like pre the impact, post the impact. Um,

impact. Um, >> so the if I just kind of look through here, average meal price went up, which makes sense. It looks like it went up by

makes sense. It looks like it went up by about 15%. Um because I would imagine in

about 15%. Um because I would imagine in cost inputs go up, people want to pass those on to consumers, so they increase the cost of a meal. So the the price of

a meal went up about 15%.

Total fast food sales only went up modestly like that that looks like one or two 2% about. And so, um,

>> that's basically would signal to me that if prices are going up 15%. But total

sales are only up two, um, volume has to be going down. So, people are buying less meals, um, likely. And then just number of franchises went down by 300

out of 10,000, so 3%. Um, and so there were some business closures as a result of this. And so I think the the overall

of this. And so I think the the overall impact is as there's some like intuition here of yeah prices went up, volume of sales went uh volume of sales likely

went down and number of franchises went down and that's kind of um exactly what what you would expect. So consumers are paying more per meal, maybe eating out less often.

>> Um there's less options for them to choose from. And then for businesses,

choose from. And then for businesses, they are still making more in in total sales. It's just spread out over fewer

sales. It's just spread out over fewer stores. So maybe um the per store

stores. So maybe um the per store profitability went up. And so you might have this benefit, you know, more super business owners in good locations,

smaller locations or smaller franchises closed. And so just concentrated the

closed. And so just concentrated the wealth among probably better performing businesses would be my hypothesis, right? So better performing businesses

right? So better performing businesses stayed open. They're making more per

stayed open. They're making more per store. Um and then the the weaker ones

store. Um and then the the weaker ones closed. I think

closed. I think from this information um I I I don't can't really conclude if this is a net positive net negative.

There's uh truthfully like more negatives jumping out. Consumers are

paying more prices. There's less

businesses open and wealth is more concentrated among you know better performing stores. And so, um, I think

performing stores. And so, um, I think those are all negatives, but the average price went up less by the than the average wage increase, uh, from a percentage point. Total sales went up.

percentage point. Total sales went up.

And so, there's some kind of mixed indicators from what I'm getting here.

Um, >> okay.

>> So, I I truthfully don't to me this is a neutral kind of there's neutral information here on whether or not we should move forward.

>> Okay. Yeah, it is. It is conflicting and that's a helpful analysis.

>> Here's some feedback from Maddie. Abby

does a good job to explain why dictated might be changing before and after.

She's not just reading numbers out loud.

She's putting them in context for the overall case. Once she concludes her

overall case. Once she concludes her analysis, she again comes back to, hey, here's what this means for the decision on the table. There was an opportunity for Abby to revisit her original framework here to add more color to

these numbers and help arrive at a decision. For example, number of

decision. For example, number of operating franchises is a macro factor, but price per meal is a micro factor.

And organizing this new information in terms of your original framework can help to show that you're using that framework to solve the problem. In

practice, you can attempt to use your framework when you've shown new data in a case. If the new data doesn't clearly

a case. If the new data doesn't clearly fit into your framework in some kind of way, that's a medium-sized signal that maybe your original approach was missing some key angles. So, I'd like your help

here, and I've got a little bit of a longer question, so feel free to repeat it back to me um if you need me to repeat or um ask me to repeat any section here. Assume the total number of

section here. Assume the total number of labor hours required per franchise remains constant year-over-year and that labor costs make up of 30% of

total operating expenses in 2023.

In 2023, the average franchise had $1 million in total expenses.

So, first I'd like you to estimate the increase in annual labor costs per franchise due to the rise in hourly wages from 16 to 20% assuming no change in hours worked per store. Then, I'd

like you to discuss how this increase in labor costs might be offset by potential savings and reduced turnover and training costs given that worker turnover decreased by 25%

after the wage increase. And then third, what strategies might franchises use to manage higher labor costs?

>> Okay. Um, got it. So, basically the the total number of labor hours has to remain constant after implementing this change. Presently, labor costs make up

change. Presently, labor costs make up about 30% of opex and the average franchise has a million dollars of total expenses or operating expenses. So that

would imply like 300k of OPEX goes to labor. Um and then three questions going

labor. Um and then three questions going off of that is estimate the increase in annual labor per franchise due to the hourly wage increase. Discuss how um

labor costs might be offset by turnover savings and then if there are strategies that the franchises could use to um manage the higher costs. Uh so I guess

starting with the first question. So

estimate the increase in annual labor cost per franchise assuming no change in hourly wages. So

in hourly work hour hours worked. So if

there's 300k of wages today and the hours worked has to stay the same and the percent goes up of wages by 25% I would assume that just

like your wage costs go up 25%. So that

would be 300k scaling um by a quarter of that which is 75. So that your total wage costs would go up to about that 375k.

Is that correct?

>> Yep.

>> Awesome. Okay. And then um the turnover question, this is an interesting question, right? It it makes a ton of

question, right? It it makes a ton of sense of turnover is like I always hear about being quite costly. Um, and so given worker turnover decreased by 25

per percent, um, do we have any metrics that you can share on just like how much a turnover costs, how many employees the average franchise has or things like

that to to do this math?

>> Do you have any estimates? I'm happy to kind of go off of what your estimates are um, and give you sort of some framework to to kind of operate within.

Sure. I I mean um I think like one month of wages might be a good estimate for for turnover costs. I I don't quite know, but I would assume like for fast I

know in corporate jobs sometimes it's like a half a year. I would imagine a less training onboarding required job.

It's less. So I'm just going to assume for simplicity like one month of wages.

And if they're making like $20 an hour, they work 30-ish hours a week. Um 600

bucks a week times four. Let's just

assume it's about 2,000ish.

Um maybe 2500ish. Uh

>> yeah.

>> Worker. Does that sound like an okay?

>> That sounds that sounds like a good estimate. Yeah.

estimate. Yeah.

>> Okay. And then you would need to know how many um employees each store has to like calculate the impact and then apply

the turnover change. Um,

I think if I think about like I worked in an ice cream shop in high school, um, it was very popular, so it was like maybe bigger and we definitely had

probably like 50 60 employees in that store. And so given it was like high

store. And so given it was like high school workers working less shifts and things, I'd maybe cut that estimate in half and say it was like 25 to 30 workers per store of a franchise.

Does that because you'd have some people that are working more frequently than like a high school student picking up two shifts a week.

>> Um does that sound okay to you?

>> Yeah, I think that's I think that's a good um estimate. Make sense?

>> Okay. Um and then a 25% reduction in turnover. I'm just going to assume that

turnover. I'm just going to assume that um turnover today is 100%. Like I I think it's they're >> annual turnover is going to be quite

steep in these businesses. So they're

losing 30 employees per year and then if that drops 25% um they would be losing just like

a quarter of that. So about seven and a half employees per year >> um less. So they would be lose less. So

less. So they would be lose less. So

they'd be losing like 22 and a half seven and a half less. So they'd be saving seven and a half times two. So

that would be like um $15,000 annually, which doesn't seem like that much money if you think about uh they

have a million dollar of opex, $15,000 a year in savings seems like a very tiny drop in the bucket, especially if like the annual increase in labor cost is

$75,000. it doesn't seem like this is

$75,000. it doesn't seem like this is going to fully offset this or really have an impact like these turnover savings. Um, I don't want to forget your

savings. Um, I don't want to forget your third question. I I just saw it down

third question. I I just saw it down that I noted it down which is okay, how what are some strategies for companies to manage costs? I think I'd break this.

>> I mean, can I stop you?

>> You're you're absolutely right. Um, and

I apologize for interrupting you, but your your math seems right and and you know, you said it's an increase in 75,000 and and according to your estimates, it's an increase in about or

a savings of about 15,000.

What of your assumptions could really impact the amount that that's actually being saved?

>> Yeah, the the cost per turnover if my one month is >> way too low. Um

>> it's like $10,000 per ramp up of an employee then >> uh then you you can hit your your 75K um

because 7 and a half times 10. Uh so

that one or like the employees per store maybe my estimate was way too low and so there's actually way more employees and so your cost um so when your turnover is

reduced you're saving more on employee >> there there's fewer turnovers right so >> absolutely >> that's changed so I think if my assumptions were different um the offset

could be higher >> okay and then how does you think about the increase in wages and then the the

savings from decreased turnover compared to closing 300 stores and increasing sales. How do all of these things sort

sales. How do all of these things sort of play together?

>> Yeah, you would have to add them all up to figure out the total economic impact.

So, um they can't really be looked at in isolation because you need to understand the magnitude of all of these in total.

And so that's like kind of gets to the first bucket of my framework like what are some key economic indicators we want to look at and what are some key KPIs we want to look at because you need to sum

um the impact on all of these KPIs of a change like this to get the total estimated impact on the economy of a change um because there's things I think we all want higher wages but if that

means there's fewer jobs or if that means there's less hours worked maybe it is a net negative but then you also have to think about all the ripple effects.

And so what's if the goal is truly economic impact on society, you want to sum the economic impact of all these ripple effects and figure out how they changed before and after.

>> Okay, great. Thank you for walking me through that. You were about to walk me

through that. You were about to walk me through um what strategies franchises might use to manage these higher labor costs.

>> Yeah. Um, so strategies they might use.

I think I would look at this from a topline and a bottom line kind of standpoint. Whenever I think about, you

standpoint. Whenever I think about, you know, cost savings strategies. So from a topline standpoint, you could try to increase prices. Um, so straight sticker

increase prices. Um, so straight sticker prices, but you could also try to reduce discounts um to indirectly increase prices. You could try to get customers

prices. You could try to get customers to buy more. So maybe you do more bundling promotions. Maybe you do more

bundling promotions. Maybe you do more um you know change the way your menu is uh outlined so that people want to buy a side and a main or etc. Like there

there's some psychological impact of how you organize the menu where people feel like they need to get sides right so if um for example like if I go to a restaurant and it's tapas or something

like I know I have to order three or four of them versus if it's mains where I just order one. So maybe there's some way you can organize your menu to get people to order more things. So that

would be the top line is just the the lowhanging fruit is pricing, but are there other things we can do to increase revenue to um basically you're going to spread the cost the increase costs off

across a wider base of revenue. Um and

then the second thing on the bottom line, I think are there other ways that we can save money outside of labor to make up for this? So maybe it's like we can save on purchasing or supply chain

costs. So what we source our products

costs. So what we source our products from, I think franchises typically have a very strict procurement grid of like I have to pay this rate. It's like a rate card that I have to procure at. And so I

don't know if that would be feasible in a franchise model. Um but maybe there's also some automation things that they could do to increase um like productivity within the store or hire

less workers. Like is there anything

less workers. Like is there anything that um could be done? So there's

automatic hamburger flipping or automatic like delivery or maybe rather than walking the meal to a customer um like for example Culver's I know will

like walk the meal out to your car does the consumer have to come in to save that extra wage. So there's big automated machines but there's also little ways you can improve your

dayto-day to just reduce the amount of work a um an hourly worker has to do.

So, those would be some various ideas that I think are um these businesses could do to offset the wage increases.

>> Okay. Well, shout out Culver's and Butterburgers, a vastly underrated uh fast food institution.

>> Here's some feedback from Maddie. Abby

does well to ground her assumption in bits of context from her life and the case. FTE training cost in a corporate

case. FTE training cost in a corporate job, for example. Monthly wages for an employee, employee count of her ice cream parlor. Finding some way to make a

cream parlor. Finding some way to make a reasonable assumption is an important role for a consultant. So, you should get your practice in by coming up with ways to think through assumptions in all of your practice cases. Once Abby has

calculated her number, she compares it to what we already knows about the cost going up and says, "Hey, this doesn't really offset that too much." She's

always putting her new numbers and information into the context of the case. Abby does well to riff with Maddie

case. Abby does well to riff with Maddie as he pressure tests some of her assumptions. Just like a real consulting

assumptions. Just like a real consulting project, as your inputs shift, your conclusions might shift as well. Aby's

math is flexible here, and she's able to think and communicate algebraically the changing implications for the client depending on the changing assumptions.

Abby does well to have a simple structure for this brainstorm. Rather

than just lobbing out random ideas, she's organizes them to show she's thinking systematically.

>> Last question for you. How would you determine if the changes in the fast food economic landscape were driven by the wage itself as opposed to other macroeconomic factors like inflation, supply chain disruption or broader

consumer trends?

>> Yeah, like this is um kind of how you do an academic study or a regression study.

You have to have control variables. Um

and so I would think about what are other things that you can control for.

So this would probably be things like um I'd want to look at how um metrics look GDP growth, employment,

etc. before this change and like what was the norm um prior to this. So maybe

that's you look at a time series of how much does GDP or how much do wages increase year-over-year um without having this change. And then

other ways I'd want to look at this is just like benchmarking versus other states and stuff like how much are they growing when they didn't do this change because that would capture things like

>> um inflation impacts or more changes that are more macro um >> that are not just going on in our state that we need to control for. So that's I would just think of things that we need

to control for key KPIs over time and versus other states in in present and um control for those variables.

>> Great. Um well, if you were advising the governor, how would you re what would you recommend regarding this policy?

>> Yeah. Um I would personally recommend that um we do not imple implement this policy as is. I recommend this for two reasons. One, I think our state is

reasons. One, I think our state is different than California from a starting wage standpoint. So, we have a $12 minimum wage today versus California has 16. So, the percent impact of just

has 16. So, the percent impact of just doing a flat 20 um dollar impact uh $20 uh wage is going to be um a much higher

impact on our small businesses and things like that and is maybe not needed. And then two, I think um there

needed. And then two, I think um there are some ripple effects in terms of businesses closing down, less hours worked, etc. And I think we need to just investigate those in more detail before

moving forward with a yes, we should do this decision. Um but I think the main

this decision. Um but I think the main the main reason why I say no is we are a different state than California in terms of hourly wage today. I think this is a path to consider going forward, but

maybe there's a different wage rate for us. And so as a next step, we'd love to

us. And so as a next step, we'd love to do an analysis of what wage, minimum wage, makes the most sense for our state um and whether or not we could help you

implement that plan. But as of now, I I don't think the $20 um an hour plan is is best for our state.

>> Great.

Well, Abby, thank you very much for your uh your time today. This was a great case.

>> Thanks, Maddie. It was great um doing a case with you as well. Hey everyone,

it's Kenton Cavest here, the founder of Rocket Blocks. Thank you so much for

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