Minimum Wage Study - MW Does Not Kill Jobs

[Loren Pechtel]

This will be worth watching. As it is, FF prices have increased dramatically in recent years, to the point where I just don't see the volume of business I used to and many FF places have been shutting down in my area (Burger King, namely and KFC seems to be struggling). Lots of people working from (and eating at) home, doesn't help either. On top of that, kiosks for ordering your food have taken off (especially at Taco Bell and Mickey D's) and I suspect will become more dominant as the new law takes effect. And robots for delivering food to your table will soon be here, if not already.

Exactly. As the minimum wage rises the point at which it makes sense to replace a worker with a machine is more and more likely to be reached. We have already seen a lot of labor saving stuff in the industry and raising the minimum wage will accelerate this transition.

 

[Loren Pechtel]

In the case of disability exemption to pay below minimum wage, isn’t that in large part because there is an agreement to provide the extra guidance coaching and protection that those employees require? And that these employees getting only $4/hour require extra subsidies to cover their daily living expenses while $4/hr won’t?

To me, the simplest thing is to just keep the exemption.
Disabled people have such individual needs and issues. A one size fits all solution like MW is probably a bad idea.
Tom

I would argue that having the MW in their hands allows them to get living conditions that do not require cooperation and support from the government, which may be difficult for the individual disabled people to navigate. While having the government can target that help and support at companies and corporations who have more ability to access systems like that.

Old idea: Pay Disabled worked less, assuming the company will use the difference to provide support services that are worth the difference, and then create living systems support services that the individual disabled people navigate.

New idea: Pay disabled people the same wage that everyone else in the living community is navigating so that they can compete on par, while government offers directed and financially overseen workplace support services.

I like the new idea better. It no longer assumes the $11/hr differential that the company saves is all being paid to support the disabled workers. Because that would be a terrible assumption.

And you are assuming that they can produce $15/hr of value. Many of them can't.

 

[Elixir]

A minimum wage may result in some job losses in some industries and increases in jobs other industries. As any honest and competent economist knows, it is an empirical question whether there is a net increase or decrease in job losses.

Correct--but every argument I see for raising the minimum wage completely ignores this and simply assumes that employees will not lose their jobs. Never addressing the economics is a pretty clear indication that the economics do not say what they want to say.

Every change - technological, climatic, economic - has effects that are secondary, tertiary and beyond. That’s the argument for Luddism or rejection of modernity, right?

 

[TomC]

you are assuming that they can produce $15/hr of value. Many of them can't.

Also that they can pay for their medical costs at $15/hr.

I have a clue about what a power wheelchair costs.
Tom

 

[DBT]

It is in the interest of employers to keep wage costs down, consequently they tend to pay as little as possible regardless of what they can afford or the market value being produced by their employees. Human nature 101. Therefore the need for an independent arbiter - the government - to set a minimum wage.

There is no way the government can possibly determine the market value that a given employee brings to a business because that's not a one-size-fits-all answer.

Thus your argument is inherently wrong.

Apparently it can, and it has worked. We have had minimum wage and conditions for many decades:

"The Australian Federal Minimum Wage has long historical roots going back to the 1907 Harvester Decision which established a 'fair and reasonable' wage to meet the needs of a working man and his family."

 

[bilby]

your side

You aren't in a conversation with a "side"; Your reply is to an individual, and you have a moral and social obligation to respond only to the points made by the individual(s) you're addressing, and not to points you might expect, hope, prefer, or imagine they might make.

Literally every time I see you reference "your side" on these fora (something you do with monotonous regularity), I immediately think "Loren is talking bollocks again".

That might well be unreasonable of me; But I would be derelict in my duty as a member of this odd little society if I didn't point out to you that this habit of yours is highly corrosive to the strength of your arguments; And if I didn't offer the following advice as a constructive criticism:

I would strongly recommend that if ever you type the phrase "your side" in a response to any post here, you stop; Reflect; And then re-word your post to only address actual claims made by the specific person you are responding to.

If you can replace "your side" with "you", without your post becoming a falsehood, then you should do so. If you can't, then you could significantly improve your reputation here by striking that part of your post before hitting "Post reply".

 

[TV and credit cards]

A living wage should simply be a part of doing business. If you can't pay it then your goods/services are not desirable enough to the customer.
The needs of the disabled and a decent life for them should be seen to by the rest of us.

Here parents of disabled children banded together and created a decent life for them complete with housing and employment for those who want it. We have housing for the disabled. Nice little free standing houses and they operate businesses: a cafe, horse ranch, ice cream shop, pet services, sell produce and coffee. And in this, they need not worry about being taken advantage of by moneygrubbing employers.

If your goods/services aren't desirable enough they won't exist--and the worker will be unemployed rather than in a low-wage job.

That's what your side always misses about this issue. If there were enough "good" jobs then the bad jobs would not find anyone they could hire. Thus the existence of the bad jobs proves that there aren't enough good jobs. "Living wage" is simply another incarnation of the infinite pool of wealth idea. (Since you make no attempt to determine if they can afford it the only conclusion is that the money you are trying to tap is infinite.)

No. There would be no bad jobs, ones that cannot afford food and shelter and the necessities in the area of the country the job is offered. What I propose is how the federal government operates. The lowest paying jobs are food service workers that are between $15-$20 an hour plus locality pay which is a minimum of 16.5% across the US and can be as high as 44.15% in San Francisco. Of course the feds throw in healthcare, retirement, and TSP. But one step at a time. We'll have to work on employers show some responsibility for the health of its employees and their well being after a lifetime of service at a later date.

 

[ZiprHead]

In California, we now have a new minimum wage law for fast food workers. Not sure exactly why FF workers are singled out for a raise, while others doing similar work are not, but that's the way the ball rolls these days:

New California law raises minimum wage for fast food workers to $20 per hour, among nation’s highest

SACRAMENTO, Calif. (AP) — A new law in California will raise the minimum wage for fast food workers to $20 per hour next year, an acknowledgment from the state’s Democratic leaders that most of the often overlooked workforce are the primary earners for their low-income households.

When it takes effect on April 1, fast food workers in California will have the highest guaranteed base salary in the industry. The state’s minimum wage for all other workers — $15.50 per hour — is already among the highest in the United States.

This will be worth watching. As it is, FF prices have increased dramatically in recent years, to the point where I just don't see the volume of business I used to and many FF places have been shutting down in my area (Burger King, namely and KFC seems to be struggling). Lots of people working from (and eating at) home, doesn't help either. On top of that, kiosks for ordering your food have taken off (especially at Taco Bell and Mickey D's) and I suspect will become more dominant as the new law takes effect. And robots for delivering food to your table will soon be here, if not already.

Burger King had a major franchiser go bankrupt causing hundreds of stores to close.

 

[thebeave]

In California, we now have a new minimum wage law for fast food workers. Not sure exactly why FF workers are singled out for a raise, while others doing similar work are not, but that's the way the ball rolls these days:

New California law raises minimum wage for fast food workers to $20 per hour, among nation’s highest

SACRAMENTO, Calif. (AP) — A new law in California will raise the minimum wage for fast food workers to $20 per hour next year, an acknowledgment from the state’s Democratic leaders that most of the often overlooked workforce are the primary earners for their low-income households.

When it takes effect on April 1, fast food workers in California will have the highest guaranteed base salary in the industry. The state’s minimum wage for all other workers — $15.50 per hour — is already among the highest in the United States.

This will be worth watching. As it is, FF prices have increased dramatically in recent years, to the point where I just don't see the volume of business I used to and many FF places have been shutting down in my area (Burger King, namely and KFC seems to be struggling). Lots of people working from (and eating at) home, doesn't help either. On top of that, kiosks for ordering your food have taken off (especially at Taco Bell and Mickey D's) and I suspect will become more dominant as the new law takes effect. And robots for delivering food to your table will soon be here, if not already.

Burger King had a major franchiser go bankrupt causing hundreds of stores to close.

Yeah, I can think of 2 BKs near me that closed recently that I used to go to. And I don't go to the other one that's still close by unless I have a coupon. There's usually only two or three customers inside when I go.

 

[ZiprHead]

In California, we now have a new minimum wage law for fast food workers. Not sure exactly why FF workers are singled out for a raise, while others doing similar work are not, but that's the way the ball rolls these days:

New California law raises minimum wage for fast food workers to $20 per hour, among nation’s highest

SACRAMENTO, Calif. (AP) — A new law in California will raise the minimum wage for fast food workers to $20 per hour next year, an acknowledgment from the state’s Democratic leaders that most of the often overlooked workforce are the primary earners for their low-income households.

When it takes effect on April 1, fast food workers in California will have the highest guaranteed base salary in the industry. The state’s minimum wage for all other workers — $15.50 per hour — is already among the highest in the United States.

This will be worth watching. As it is, FF prices have increased dramatically in recent years, to the point where I just don't see the volume of business I used to and many FF places have been shutting down in my area (Burger King, namely and KFC seems to be struggling). Lots of people working from (and eating at) home, doesn't help either. On top of that, kiosks for ordering your food have taken off (especially at Taco Bell and Mickey D's) and I suspect will become more dominant as the new law takes effect. And robots for delivering food to your table will soon be here, if not already.

Burger King had a major franchiser go bankrupt causing hundreds of stores to close.

Yeah, I can think of 2 BKs near me that closed recently that I used to go to. And I don't go to the other one that's still close by unless I have a coupon. There's usually only two or three customers inside when I go.

We had two close up here too at the same time. One is already being remodeled for another operation.

 

[Lumpenproletariat]

We'll have to work on employers show some responsibility for the health of its employees and their well being after a lifetime of service at a later date.

Why can't someone go into business, hire some workers as needed to serve the customers better, and not take on the role of being the babysitter of the workers? What is it about being an employer that requires one to also become a babysitter? What if a small company needs only 10-20 workers and is interested in providing a product or service but does not want to become a babysitting operation?

The grown-up thing is to just pay what is necessary to attract the needed workers, and then the workers act like adults and make their own choices on how to spend their money for better health care and well being etc.?

 

[TV and credit cards]

We'll have to work on employers show some responsibility for the health of its employees and their well being after a lifetime of service at a later date.

Why can't someone go into business, hire some workers as needed to serve the customers better, and not take on the role of being the babysitter of the workers? What is it about being an employer that requires one to also become a babysitter? What if a small company needs only 10-20 workers and is interested in providing a product or service but does not want to become a babysitting operation?

The grown-up thing is to just pay what is necessary to attract the needed workers, and then the workers act like adults and make their own choices on how to spend their money for better health care and well being etc.?

Not a babysitter but seeing to the health of one's employees makes for more productive employees.
A small company like any company has costs: building, equipment, utilities, etc. Caring for an employee who dedicates a lifetime of service to your company would simply be a part of doing business. Or we could just have the federal government provide healthcare for its citizens like the military does where medical professionals provide what you need when you need it, period. I think this country is wealthy enough to afford that.

A bowl of rice and beans would attract workers if all employers offered by way of payment were rice and beans.

 

[Elixir]

In California, we now have a new minimum wage law for fast food workers. Not sure exactly why FF workers are singled out for a raise, while others doing similar work are not, but that's the way the ball rolls these days:

New California law raises minimum wage for fast food workers to $20 per hour, among nation’s highest

SACRAMENTO, Calif. (AP) — A new law in California will raise the minimum wage for fast food workers to $20 per hour next year, an acknowledgment from the state’s Democratic leaders that most of the often overlooked workforce are the primary earners for their low-income households.

When it takes effect on April 1, fast food workers in California will have the highest guaranteed base salary in the industry. The state’s minimum wage for all other workers — $15.50 per hour — is already among the highest in the United States.

This will be worth watching. As it is, FF prices have increased dramatically in recent years, to the point where I just don't see the volume of business I used to and many FF places have been shutting down in my area (Burger King, namely and KFC seems to be struggling). Lots of people working from (and eating at) home, doesn't help either. On top of that, kiosks for ordering your food have taken off (especially at Taco Bell and Mickey D's) and I suspect will become more dominant as the new law takes effect. And robots for delivering food to your table will soon be here, if not already.

Burger King had a major franchiser go bankrupt causing hundreds of stores to close.

Yeah, I can think of 2 BKs near me that closed recently that I used to go to. And I don't go to the other one that's still close by unless I have a coupon. There's usually only two or three customers inside when I go.

We had two close up here too at the same time. One is already being remodeled for another operation.

Yeah such a shame. We had a Burger King, but it closed down. Now it’s a burger joint. You can get a burger for $14-18 and they’ll even give you kimchi with it.
I’m not sure why Bk failed but it obviously wasn’t because their prices were too high or they were paying employees too much.

 

[Jimmy Higgins]

In the case of disability exemption to pay below minimum wage, isn’t that in large part because there is an agreement to provide the extra guidance coaching and protection that those employees require? And that these employees getting only $4/hour require extra subsidies to cover their daily living expenses while $4/hr won’t?

To me, the simplest thing is to just keep the exemption.
Disabled people have such individual needs and issues. A one size fits all solution like MW is probably a bad idea.
Tom

I would argue that having the MW in their hands allows them to get living conditions that do not require cooperation and support from the government, which may be difficult for the individual disabled people to navigate. While having the government can target that help and support at companies and corporations who have more ability to access systems like that.

Old idea: Pay Disabled worked less, assuming the company will use the difference to provide support services that are worth the difference, and then create living systems support services that the individual disabled people navigate.

New idea: Pay disabled people the same wage that everyone else in the living community is navigating so that they can compete on par, while government offers directed and financially overseen workplace support services.

I like the new idea better. It no longer assumes the $11/hr differential that the company saves is all being paid to support the disabled workers. Because that would be a terrible assumption.

And you are assuming that they can produce $15/hr of value. Many of them can't.

$15 /hr isn't what it used to be. See so many people complaining about $15 /hr. I haven't worked for $15 an hour or less in nearly 25 years! $15 an hour is $31,200 a year (at 40 hours). I'd imagine the health care would cost at least 1/3 that.

But you aren't supposed to work there for a living... yeah... we are a services economy now, so this is one of those jobs.

 

[laughing dog]

We'll have to work on employers show some responsibility for the health of its employees and their well being after a lifetime of service at a later date.

Why can't someone go into business, hire some workers as needed to serve the customers better, and not take on the role of being the babysitter of the workers? What is it about being an employer that requires one to also become a babysitter? What if a small company needs only 10-20 workers and is interested in providing a product or service but does not want to become a babysitting operation?

The grown-up thing is to just pay what is necessary to attract the needed workers, and then the workers act like adults and make their own choices on how to spend their money for better health care and well being etc.?

Did you purposely contrast the baby babble about babysitters in the 1st paragraph and the 2nd paragraph about the "the grown-up thing ?

I ask because
1) no one is talking about "babysitting" workers or requiring employers to hire more workers than what they need, and
2) adults (at least rational humane adults) take care of one another.

 

[robnisch]

My anecdote. In 1979 I was making $14.50/hr.as a machinist. Now, I am skeptical of those inflation charts, but, that's over $60/hr today.
And, I had affordable insurance.

 

[Elixir]

1969 I was hired as a novice (ZERO experience) heliarc welder for $3.75/hr. Up to $4.50 a few months later. No benefits but it seemed like the pay was okay. According to conversion tables, that starting pay was equivalent to more than $29/hr in today’s money. And we can’t pay FF workers half of that?

 

[DBT]

It's the reason why unions were formed in the first place.

 

[Loren Pechtel]

A minimum wage may result in some job losses in some industries and increases in jobs other industries. As any honest and competent economist knows, it is an empirical question whether there is a net increase or decrease in job losses.

Correct--but every argument I see for raising the minimum wage completely ignores this and simply assumes that employees will not lose their jobs. Never addressing the economics is a pretty clear indication that the economics do not say what they want to say.

Every change - technological, climatic, economic - has effects that are secondary, tertiary and beyond. That’s the argument for Luddism or rejection of modernity, right?

I see no rebuttal, you're demanding we stick our heads in the sand rather than address an unpleasant reality.

 

[Loren Pechtel]

you are assuming that they can produce $15/hr of value. Many of them can't.

Also that they can pay for their medical costs at $15/hr.

I have a clue about what a power wheelchair costs.
Tom

It would be possible to subsidize medical separately, that's not an argument against it.

The reality is that employers will choose the most desirable of their applicants. We already see that in periods of higher unemployment those who are medically marginal generally can't find a job, there's always a more able-bodied person to hire instead.