Minimum Wage

[OmegaRuby and AlphaSapphire]

Where I live it's 9.10. But the cost of living is also somewhat higher than in the east and southern parts of the country (but not too much as we don't live in a big city).
I think that the minimum wage should be adjusted for inflation (including deflation to keep it consistent) and wait and see what happens after that. If it doesn't lower income inequality it may be something else than livable wages that's the issue.

 

[Oryx]

Minimum wage jobs were never meant to be livable wages. The only reason it's getting expected now in the US is because the job market is horrible here and 9 times out of 10 when they talk about new jobs being added to the economy, they are minimum-wage, service-sector jobs. People aren't leaving their current jobs because there's nothing with comparable benefits to go to, and new job seekers are left with few options.

This is something I've discussed with my mother before that I think has sone merit - she argues that there should be a mininum wage for those above 18 and a minimum wage for minors. She sees the minimym wage as you do, not meant to live off of, and furthermore meant for jobs that are so simple high schoolers can do them. The divide would be hard to police though - what about older people still living at home? What about minors that financially support themselves at home? It's a difficult concept, but I think it has potential.

 

[LuckyLucario2000]

Minimum wage jobs were never meant to be livable wages.

Wrong! Franklin D. Roosevelt, the president who WROTE the minimum wage bill, and abolished the social atrocity of child labor said that the minimum wage law was made so that people could make a decent living and not live in poverty.

Quit parroting right wing propaganda.

I work at a retail store for minimum wage (8$/hr) and I do three times the amount of work my head management has to do. CEOs do next to nothing and they live like kings. So don't give me that "It was never meant to be a livable wage." crap because you didn't even know what the minimum wage law was intended for when it was created in 1937. You may want to brush up on your history my friend.

The minimum wage is basically the company you work for saying "Hey, we'd pay you even less, but it's illegal.". Had the minimum wage kept up with inflation, it would currently be around 21$. But hell, I'd be happy with 12$ an hour. I work hard at my job, even though it is minimum wage. So don't you say that people who work for minimum wage's jobs are easy. Retail is far from easy. You have no idea of the crap minimum wage workers have to put up with. Go look at Tales From Retail and you'll start to grasp it.

 

[Konishi]

This is something I've discussed with my mother before that I think has sone merit - she argues that there should be a mininum wage for those above 18 and a minimum wage for minors. She sees the minimym wage as you do, not meant to live off of, and furthermore meant for jobs that are so simple high schoolers can do them.

Some problems with having a dual minimum wage:
1. There wouldn't be equal pay for equal work.
2. Employers might become more inclined to hire teenagers, instead of people who need the jobs a lot more.

The divide would be hard to police though - what about older people still living at home? What about minors that financially support themselves at home? It's a difficult concept, but I think it has potential.

Some countries have separate minimum wages for youths and adults. It isn't a difficult policy to implement/police. The divide is at a certain age. The year of birth would be on ID such as drivers licences, passports, birth certificates, student IDs etc.

 

[Konishi]

A common right wing myth about the minimum wage, is that any increase would result in an increase in unemployment.

Most minimum wage jobs are fixed and necessary for the firm (or other workplace organisation) to function. For example, a fast food outlet would need a fixed number of staff cooking, cleaning and operating the tills. Raising (or lowering) the minimum wage slightly is highly unlikely to affect the number of workers the firm hires.

Another thing to consider is the increased consumption due to higher wages. Employers pay more in wages, but get some of that money back due to the increased consumption. The increased consumption would increase incentives for production and investment, potentially leading to more people hired.

Employment data usually shows no evidence of increased unemployment when a minimum wage is increased. The minimum wage doesn't cause significant levels of unemployment unless it is raised too high.

 

[Konishi]

Another right wing myth is that minimum wage is 'unfair' and 'unnatural' because people aren't paid the market rate they are 'worth'. In the most capitalistic economies, those who work the hardest and create the most wealth, get paid the least, while an asset owning robber class usurp the wealth and do very little work.
The minimum wage helps shift the market closer to the principle of 'a fair day's pay for a fair day's work'.

 

[Addy]

This is something I've discussed with my mother before that I think has sone merit - she argues that there should be a mininum wage for those above 18 and a minimum wage for minors. She sees the minimym wage as you do, not meant to live off of, and furthermore meant for jobs that are so simple high schoolers can do them. The divide would be hard to police though - what about older people still living at home? What about minors that financially support themselves at home? It's a difficult concept, but I think it has potential.

I know in Ontario, where I live, we do have a minimum wage for those students under the age of 18 and those who are over the age of 18 which is considered "adult min wage".

But to the point about surviving on min wage. As a single adult if I lived with a roommate and shared a 2 bedroom apartment, I could barely survive on min wage working 40 hours a week and paying all my bills which include repayment of my student loans. There are tonnes of families out there that only have 1 adult working and they barely survive. Yet when people demand that the min wage be increased, law makes complain. When they do raise it, just a tiny amount, companies raise their prices so you are automatically back to square one.

 

[LuckyLucario2000]

A common right wing myth about the minimum wage, is that any increase would result in an increase in unemployment.

Most minimum wage jobs are fixed and necessary for the firm (or other workplace organisation) to function. For example, a fast food outlet would need a fixed number of staff cooking, cleaning and operating the tills. Raising (or lowering) the minimum wage slightly is highly unlikely to affect the number of workers the firm hires.

Another thing to consider is the increased consumption due to higher wages. Employers pay more in wages, but get some of that money back due to the increased consumption. The increased consumption would increase incentives for production and investment, potentially leading to more people hired.

Employment data usually shows no evidence of increased unemployment when a minimum wage is increased. The minimum wage doesn't cause significant levels of unemployment unless it is raised too high.

Conservatives love to get people to go crazy over falsified information because they make it seem quite believable and know that their constituents will not look into the information any further beyond what they're told, because they trust they're being told the truth.

 

[PokemonLeagueChamp]

The minimum wage requirement can cause unemployment if/when machines start replacing workers in certain areas. Self-checkout machines already exist in a lot of retail stores. If minimum wage is pushed up, some stores might try to figure out how to deal with it, but a lot will probably just start going automated to cut expenses. This option didn't exactly exist in the past, but it does now. Up the minimum wage enough and larger corporations able to afford machine replacements will utilize them where possible. The fact is, the reason most businesses exist is to make money, not to provide employment. Just because you can legislate a higher minimum wage, don't expect human nature to change any because of it. Small businesses will just have a more difficult time than they're already having, and large corporations will just get rid of what minimum wage positions they can. Honestly, I'm surprised Wal-Mart hasn't pulled that move yet.

 

[Livewire]

I wouldn't go so far to suggest that companies would go to automated machinery to replace workers as a way to skirt the minimum wage hikes. Maybe in grocery stores, you'd see more self-checkout lanes, but I don't see that as a major thing. If anything, servicing and maintaining the machines in the long run, would be more expensive to deal with than to just pay a person a $10 minimum wage.

 

[Kanzler]

The price of wages is more elastic than the ability of workers to give out their labour - you can get away with paying people tiny wages because people don't want to die. It's kind of unfair that some people argue that people should be paid what "the market will pay them". Unlike a pure market where people can refuse to buy a certain product if it costs too much, people can't really refuse to work if they're paid too little - the price of exiting the labour market is called death. These are my arguments for why we shouldn't place free market assumptions on labour, because it doesn't work that way.

 

[rexmorgan]

It is not enough for our financial needs. It is a challenge to budget small amount of money. In break with most merchants, Costco's CEO says he supports President Obama's call to increase the minimum wage. But while the President hopes to raise it to $9 an hour, Costco would let it go even greater, to $10.10 an hour.

 

[4freemarket]

"I wouldn't go so far to suggest that companies would go to automated machinery to replace workers as a way to skirt the minimum wage hikes. Maybe in grocery stores, you'd see more self-checkout lanes..."

Why would one not expect employers in every industry to replace manpower with automation any time it can? This is exactly what has happened since the beginning of the machine age. The flying shuttle brought down the cost of making cloth even as it replaced scores of independent hand looms working in private homes.

More recently, McDonalds is experimenting with machines that take bags of potatoes from the freezer to the grease, to the serving rack without the touch of human hands. Warehouse stores are offering various samples by the customer swiping his/her member card. If grocery stores can do self check-out, why shouldn't fast food places expect you to place your order and pay for it w/out having the possibility of misinterpretation. Various "family" restaurants are placing touch screens on their tables and "allowing" the patron to order his/her own meal. Farmers are experimenting with different types of fruits, etc. that are amenable to mechanical pickers.

No, business must cut costs to stay competitive and stay in business. (Labor is both one of the highest percentages and least fixed of total operating costs.) We, as consumers, demand the best value for our dollar. In our own economic self interest, we as consumers will continue to seek the best value.

 

[for him.]

In my opinion, minimum wage should be lower. Higher minimum wage values encourages companies to cut back and not make new jobs for the economy. Yes, it sucks that there are people who have to live off of it, but can't. Minimum wage isn't something people should live off of.

 

[Livewire]

In my opinion, minimum wage should be lower. Higher minimum wage values encourages companies to cut back and not make new jobs for the economy. Yes, it sucks that there are people who have to live off of it, but can't. Minimum wage isn't something people should live off of.

None of that is really true. Increasing the minimum wage, in several studies, has shown no adverse effects to employment or hiring. If that were the case, a company like Costco that pays very high wages right off the bat to unskilled workers would have foundered and been buried in Chapter 11 Bankruptcy a long time ago.

And right, people shouldn't have to live off of minimum wage, especially if it's low and doesn't jive with the cost of living. But it's a sad reality that many people all over the United States and abroad do so, some with even less than that. So the logical pathway is to raise it, not lower it.

Why would one not expect employers in every industry to replace manpower with automation any time it can? This is exactly what has happened since the beginning of the machine age. The flying shuttle brought down the cost of making cloth even as it replaced scores of independent hand looms working in private homes.

More recently, McDonalds is experimenting with machines that take bags of potatoes from the freezer to the grease, to the serving rack without the touch of human hands. Warehouse stores are offering various samples by the customer swiping his/her member card. If grocery stores can do self check-out, why shouldn't fast food places expect you to place your order and pay for it w/out having the possibility of misinterpretation. Various "family" restaurants are placing touch screens on their tables and "allowing" the patron to order his/her own meal. Farmers are experimenting with different types of fruits, etc. that are amenable to mechanical pickers.

No, business must cut costs to stay competitive and stay in business. (Labor is both one of the highest percentages and least fixed of total operating costs.) We, as consumers, demand the best value for our dollar. In our own economic self interest, we as consumers will continue to seek the best value.

Because it doesn't fit into every industry as easily as you claim? People buy from other people, not robots. When we start to see medical androids taking care of people instead of nurses, then that might apply. And remember, people still need to service the systems, program the things, etc. So there's always a labor component in some way shape or form.

 

[4freemarket]

"People buy from other people, not robots."

Really? Have you heard about a company called Amazon? Have you not seen pictures of the Automat of yesteryear? They are making a comeback in a number large cities today, and yes, restaurants are starting to "let" customers order their own wood via touch screen.

"When we start to see medical androids taking care of people instead of nurses, then that might apply."

And you think that cannot, will not, happen? Certainly we will not see robots changing bandages anytime soon, but we are already seeing virtual medicine being practiced. It will not take much to allow a central nursing station to replace 90% of what the nurse does when s/he goes into the room.

"Because it doesn't fit into every industry as easily as you claim?"

Change does not have to come to EVERY industry but every time labor saving changes come to one industry it affect all industries.

Can we agree that because of the need for certain skills, because of certain working conditions, etc. that certain workers should make more than others, that semi-skilled workers should make more than unskilled workers and skilled workers should make more than semi-skilled workers?

What happens to the roofer making $15/hr if the minimum wage doubles to $15/hr? Will the roofer's wage stay at $15/hr? If it took double the minimum to entice the roofer to suffer the heat and brave the danger, will it not take double the minimum wage for that roofer to remain a roofer, or will he stay on the ground and use his proven dedication to the workplace to displace the previous $7/hr worker? No, his employer will pay him more to do the same work. To do that he must charge the customer more for the job. Higher wages without greater productivity = inflation.

Is it not logical for every worker to expect to receive a similar increase as the minimum wage worker? Should the nurse not expect to make "X%" more than the nurse aid who now expects to make "X%" more that the custodian who now makes $15/hr.? Of course, every worker is going to expect an increase. What happens when wages go up without a corresponding increase in productivity? Inflation.

A manufacture sets the prices of shoes at $50/pair because that is the prices at which willing buyers will pay for the total available output of shoes. What happens when a large number of new buyer have new money to buy shoes? The manufacturer will, of necessity, raise the price of shoes to the point where supply and demand are now equal.

"If that were the case, a company like Costco that pays very high wages right off the bat to unskilled workers..."

GREAT! If certain stores can pay more than minimum wage, more power to them. They get to pick and choose from a wider base of applicants. Their buying power allows them to have certain efficiencies that the Mom & Pop store simply does not have. Mom & Pop stores simply cannot compete of price. Maybe on service like home delivery, or actually knowing the merchandise and how to help the customer pick the right product, but not on price. There fast becomes a point that even the extra services are not enough to keep the doors open for Mom & Pop.

"So there's always a labor component in some way shape or form."

Agreed, but it will be the low cost, unskilled, labor that will be eliminated first.