evidence: An increase in the minimum wage increases firms’ costs and lowers their profits. Firms often try to pass that cost through to the consumer in the form of higher prices for their products. Some goods are made to be consumed where they are purchased, and others have no viable substitutes—haircuts, restaurant meals, electricity, water, and construction. Firms can raise the price of these goods and pass the minimum wage-related extra costs on to the consumer. Clemens also cites a study that argues that minimum wage hikes can be regressive because a large proportion of low-income households’ budgets go toward products and services made by minimum wage workers, such as restaurants. He even cites the 2019 Consumer Expenditure Survey to show that food (both at and away from home) accounts for 15 percent of the budget of low-income homes but only 10 percent of the budget of high-income homes. All of this means that the increase in the income of those receiving the minimum wage is thus smaller than it was intended to be. Other ways that firms can adjust to minimum wage increases is by making noncash benefits (such as pensions, health insurance, and paid leave) less generous. With a higher minimum wage, health insurance may become less generous for all employees, even the higher skilled employees not directly affected by the minimum wage. From their perspective, they would be worse off than before.