Right, but arbitrarily declaring that a specific wage level is the true one does not make something a cost to the business. We, collectively, decide that people should not make less than X. That does not make each person's labor worth X in a free market, and it does not make X the 'true' cost of paying a person. If we, as a society, decide that people should make at least X, then we, as a society, should subsidize wages below X until it is X.

The gap between the free market value of someone's labor and a 'living wage' is not an externality. It is not a secret cost that businesses are shirking. It is a social obligation that we made up because we want our citizens to have a certain standard of living, and that's fine, but we should all pay that together.

Companies should pay people what their labor is worth, and we should all make up the difference together, if that's what we believe is right.