Minimum Wage

[cow451]

Of course, couldn't the argument me made that public aid is part of the problem? If Wal-Mart employees didn't have the option of going on public aid, then they would either need to cease being Wal Mart employees or Wal Mart would have to give them a raise. The more employees leave for better paying opportunities, the more Wal Mart has to pay to remain competitive. This could happen as an aggregate of individuals leaving or demanding higher wagers, or more likely collectively, as unions would likely have more persuasive power over employees if the employees relied exclusively on their wages. I suppose the other option for Wal Mart in that scenario is to rely exclusively on the labor of people who really don't need the money (e.g., students and homemakers), but these people tend to be particularly unreliable employees.

One of the major reasons behind "safety net" programs is to cut down on rioting in the streets and armed revolution. Hungry homeless people in large numbers tend to take to the streets.

 

[stamperben]

Why not require workers to take jbs that have a wage to meet their needs?

Why didn't they think of this in the first place?

 

[iluvatar5150]

Why not require workers to take jbs that have a wage to meet their needs?

Do you really think it's necessary to mandate that people take better-paying jobs? Don't you think most people would take better paying jobs if they could get them?

Why didn't they think of this in the first place?

Seriously.

 

[dies-l]

What someones labor is supposedly worth changes on a regular basis. Often the amount spent by the employer* ends up being the least amount of money they can get away with paying the employee while still obtaining their services. Numerous factors contribute to this wage including minimum wage laws. A modest raise in the minimum wage would cause a small alteration of one of those factors that already comes into play.

The results from past instances of minimum wage increase should be worth more than all the studies and predictions combined. It shows what actually happened when the minimum wage was raised in the past. This evidence clearly shows that modest increases in the minimum wage do not cause significant changes in unemployment.

* What many consider to be the indicator of what a persons labor is really worth.

But, for smaller scale employers, it is entirely possible that $10.10/per hour could exceed the actual value of an employee's labor. Let's say that you offer a service for which is paid a fee of $50/hour, according to the prevailing rate in the community. Let's say that the total costs of providing said service (overhead, advertising, supplies, etc) is $40/hour. This means that, at a $10.10 minimum wage, the employer loses $.10 for every hour of service performed. The value of the employee's labor cannot, by any calculation, be said to exceed $10.00 per hour.

But we also need to consider that, if the employer is not making any money, the employer will not remain in business. So, the value of the employee's work is going to be affected by how much the employer needs to make for it to be worthwhile to remain in business. Otherwise, the employee doesn't have a job anymore. Also, considering that the MegaCorp outlet down the street is able to provide the same service at a total cost of $20 per hour, and so charges only $45/hour for the service, raising pricing to cover costs isn't an option, unless the employer is able to convince the community that it makes sense to pay a much higher fee just to support small business. Experience shows that that doesn't happen; however, the employer may find that employees may enjoy working at a smaller company so much that they might be willing to work for $7.50/hour. With an increased, minimum wage, that arrangement is illegal, and so the smaller company is forced out of business.

 

[dies-l]

Sort of.

The availability of public aid certainly gives employers the opportunity to offload some of their expenses onto the public, but removing public aid altogether means removing aid for people who really need it. Removing aid just for people who are also working incentivizes people to not work.

IMO, the better option is to require employers to pay enough to make an average employee not eligible for aid. This puts the burden where it ought to be while still affording help to people who need it and incentivizing workers to find jobs.

But, what of the small employer who cannot afford to pay a high wage, with employees who do not need a high wage.

 

[dies-l]

One of the major reasons behind "safety net" programs is to cut down on rioting in the streets and armed revolution. Hungry homeless people in large numbers tend to take to the streets.

Yes. Bread and circuses!

 

[iluvatar5150]

But, for smaller scale employers, it is entirely possible that $10.10/per hour could exceed the actual value of an employee's labor. Let's say that you offer a service for which is paid a fee of $50/hour, according to the prevailing rate in the community. Let's say that the total costs of providing said service (overhead, advertising, supplies, etc) is $40/hour. This means that, at a $10.10 minimum wage, the employer loses $.10 for every hour of service performed. The value of the employee's labor cannot, by any calculation, be said to exceed $10.00 per hour.

Actually, it's the value of the product/service that's low and the business itself is unsustainable. If you have a business that, say, requires a whole ton of electricity, but doesn't generate enough revenue to cover the cost of the utilities, that doesn't mean that the electricity is any less valuable - it means that your service isn't valuable enough to cover the cost of providing it.

But we also need to consider that, if the employer is not making any money, the employer will not remain in business. So, the value of the employee's work is going to be affected by how much the employer needs to make for it to be worthwhile to remain in business. Otherwise, the employee doesn't have a job anymore.

I think we should do away with the notion that "having a job" should be a goal unto itself, regardless of how much money that job actually pays. Working for peanuts isn't much better than not working at all.

Also, considering that the MegaCorp outlet down the street is able to provide the same service at a total cost of $20 per hour, and so charges only $45/hour for the service, raising pricing to cover costs isn't an option, unless the employer is able to convince the community that it makes sense to pay a much higher fee just to support small business. Experience shows that that doesn't happen;

That's not true at all. In fact, many small businesses are finding that the best way to survive (and thrive) is to go high-end/boutique and cater to people who ARE willing to pay more. For all of the reasons already mentioned, small businesses can't compete against low-end high-volume stores, but they can definitely compete in areas that require more service and attention to the craft. I've worked in one boutique shop like that and I was just reading an article yesterday about the explosion of the American bourbon distillery industry. IIRC, cheap bourbons (< $15/bottle) have only seen modest growth over the last decade (9%), whereas premium and ultra premium bourbons ($35+/bottle) have seen over 10x that (96%). Exports to certain countries have grown by something like 9000%. The craft beer business has seen a ton of growth, too, despite costing upwards of 5-8x more than Bud Light or Keystone.

however, the employer may find that employees may enjoy working at a smaller company so much that they might be willing to work for $7.50/hour. With an increased, minimum wage, that arrangement is illegal, and so the smaller company is forced out of business.

If you let the small employer pay lower wages, you have to let the big employer do it, too. Now the big employer has just reduced his overhead and can drop his prices, which means that the small employer has to drop his prices to compete. In order for the small employer to drop his prices, he has to reduce his overhead (including wages) again. And again, if he drops his wages, then the big employer gets to reduces wages even further. The result is that the employees make less and less for the sake of "low prices."

 

[iluvatar5150]

But, what of the small employer who cannot afford to pay a high wage, with employees who do not need a high wage.

We aren't talking about raising the minimum wage to anything exorbitantly high. We're talking about raising it to a point where somebody can survive on it.

If you can't afford to be in business while paying your employees enough to survive, then you can't afford to be in business. Period. I would say the same thing if we were talking about electric rates, security expenses, cleaning services, office supplies, or whatever. Part of your responsibility as a business owner is figuring out your market, how to market and price your products appropriately so that you can continue to afford to stay in business, and also whether or not your products/services are even appropriate for that market - because not all products/services are appropriate for all markets. I couldn't very well open a Bugatti dealership in rural northern NY and then complain that Bugatti charges too much for their cars, because my customers don't want to pay $1m+ for a car that can't drive in the snow. It's not Bugatti's fault I made a poor business decision and I shouldn't expect them to give away cars to subsidize my poor decisions. Likewise, I shouldn't open a business in an area that can't support my business, then complain that my payroll expenses are too high because my employees want to eat and pay rent, and I shouldn't expect them to give away their time and labor because I made poor decisions.

 

[cow451]

Yes. Bread and circuses!

Bread and jobs is the idea.

 

[MikeCarra]

Of course, couldn't the argument me made that public aid is part of the problem? If Wal-Mart employees didn't have the option of going on public aid, then they would either need to cease being Wal Mart employees or Wal Mart would have to give them a raise.

What a great idea! So basically if people are against slavery they should simply NOT BE SLAVES! It's a foolproof plan!

AND it means we don't have to ask the "market leaders" to change their behavior.

The more employees leave for better paying opportunities,

Where are all these opportunities at again?

 

[MikeCarra]

Why didn't they think of this in the first place?

Remember: minimum wage workers are STOOPID.

 

[stamperben]

Remember: minimum wage workers are STOOPID.

yeah, imagine all of them throwing out all those $35/hour job offers so they could work at Wally World.

 

[ThatRobGuy]

WalMart should be forced to take on the REAL costs of their business. That includes NOT foisting off on PUBLIC AID their employees.

According to one study from the Democratic staff of the U.S. House Committee on Education and the Workforce: "According to the report, Walmart had more workers enrolled in the state’s public health care program in the last quarter of last year than any other employer, with 3,216 people enrolled. When the dependents of those workers were factored in, the number of enrollees came to 9,207."

This means they are not paying the full cost of their business.

I could easily succeed in the market if I only sold and made money and didn't have operating expenses.

One Wisconsin store was estimated to cost the TAXPAYER $900,000 in public assistance for the Walmart employees.

No, it just means that they're the largest retail employer. Anyone who works retail pretty much makes the same as a Walmart employee (meaning they'd be eligible for all the same benefits), it's just because Walmart employs so many that the stats turn out like this...

Walmart having 3,000 people enrolled in state programs is no better or worse than 30 small retail stores all having 100 employees a piece enrolled in the programs...

I guess as a consumer the bigger question is: WHY DON'T YOU DEMAND INCREASED WAGES?

Or do you LIKE MAKING UP THE DIFFERENCE FOR WALMART?

By demand increased wages...do you mean demand artificially inflated wages?...because the way you present it is economic blackmail.

"Hey, if you don't pay this guy $20/hour for performing a service that's only worth $8/hour, then we're just going to make you support him with your tax dollars instead!"

In terms of retail jobs, the Walmart folks don't have it as bad as some others...

According to the business insider,
The average Walmart "associate," Wake Up Walmart reports, makes $11.75 an hour. That's $20,744 per year.

Another interesting article you may want to read:
Target -- The Emperor Has No Clothes! | Ralph Nader

While this article isn't particularly flattering to walmart either, I think it does describe the scenario I mentioned which is that walmart isn't worse than any other retailer in terms of wages, it just happens to employ more people thus making those low wages more visible to the public.

I have a cousin who works at Hot Topic (which is a retail store) and she makes only $9/hour...does that mean we should start protesting hot topic?

 

[ThatRobGuy]

Remember: minimum wage workers are STOOPID.

If anything, it's your side that's suggesting that...no ours.

We're saying that they need to take some responsibility and be resourceful (that's how you talk to an adult)

You're saying "well, it's okay (pat on the head) we'll just get the government to make that mean old store give you some more money" (which is how a person would talk to their 9 year old)

...you're essentially saying "we'll get the government to make sure you get more money since we know you'd never be able to do it on your own"

...we're essentially saying "you don't need the government to make them give you more money because you have the potential to make more than that on your own"

 

[iluvatar5150]

By demand increased wages...do you mean demand artificially inflated wages?...because the way you present it is economic blackmail.

"Hey, if you don't pay this guy $20/hour for performing a service that's only worth $8/hour, then we're just going to make you support him with your tax dollars instead!"

That's essentially what's happening now. Employers have figured out a way to offload the cost of their labor supply onto the public by taking advantage of the social safety net.

What's being advocated is shifting that cost back onto the employers

I have a cousin who works at Hot Topic (which is a retail store) and she makes only $9/hour...does that mean we should start protesting hot topic?

Wal-Mart is a large driver of many of these low wages. They have (and have used) their large size and industry muscle to force suppliers to outsource production and cut domestic wages. While WM is certainly not the only guilty party, they're definitely the leader of the pack.

 

[stamperben]

If anything, it's your side that's suggesting that...no ours.

We're saying that they need to take some responsibility and be resourceful (that's how you talk to an adult)

You're saying "well, it's okay (pat on the head) we'll just get the government to make that mean old store give you some more money" (which is how a person would talk to their 9 year old)

...you're essentially saying "we'll get the government to make sure you get more money since we know you'd never be able to do it on your own"

...we're essentially saying "you don't need the government to make them give you more money because you have the potential to make more than that on your own"

No, our "side" isn't suggesting that at all. What we're saying is the fact that the jobs to meet their economic needs ARE NOT THERE. That makes a claim that workers should be mandated to seek employment that meets their needs STOOPID.

 

[iluvatar5150]

If anything, it's your side that's suggesting that...no ours.

We're saying that they need to take some responsibility and be resourceful (that's how you talk to an adult)

You're saying "well, it's okay (pat on the head) we'll just get the government to make that mean old store give you some more money" (which is how a person would talk to their 9 year old)

...you're essentially saying "we'll get the government to make sure you get more money since we know you'd never be able to do it on your own"

...we're essentially saying "you don't need the government to make them give you more money because you have the potential to make more than that on your own"

We're essentially saying, "Companies should have to foot the bill for the true cost of their labor expenses."

You're essentially saying, "It's ok for the taxpayers to subsidize employer payroll if the employer finds it profitable to hire people desperate for work and willing take whatever wages they can get, regardless of whether or not those wages are sufficient to survive on."

 

[MikeCarra]

If anything, it's your side that's suggesting that...no ours.

We're saying that they need to take some responsibility and be resourceful (that's how you talk to an adult)

You lead a blessed life and you obviously don't have a lot of contact with a large number of Americans.

You're saying "well, it's okay (pat on the head) we'll just get the government to make that mean old store give you some more money" (which is how a person would talk to their 9 year old)

Not really.

But since we are talking about treating people like adults: since when is it acceptable to say: "I wanna make a zillion trillion dollars and not pay for anything to help me make my money!"

Which is effectively what WalMart says when they FAIL TO PAY THEIR EMPLOYEES SUFFICIENTLY TO AFFORD BASIC LIFE MATERIALS.

As I noted in an earlier post, but WalMart employees have shown up often to be very high users of public aid. The study I cited earlier found that ONE WALMART SUPERCENTER in WI cost taxpayers $900,000 in public aid costs.

ONE WALMART SUPERCENTER.

Why? Because Walmart wants to make a zillion trillion dollars and they do that by NOT PAYING THE TRUE COSTS OF THEIR OWN BUSINESS.

So let's drop the whole "talk to adults" angle.

I'm seeing a LOT of special pleading on behalf of the wealthy here and almost no compassion for the poorest members of our society.

I see people lobbying on behalf of vast wealth and blaming the poor for their position.

I don't understand what kind of world one must live in to arrive at that position.

 

[ThatRobGuy]

No, our "side" isn't suggesting that at all. What we're saying is the fact that the jobs to meet their economic needs ARE NOT THERE. That makes a claim that workers should be mandated to seek employment that meets their needs STOOPID.

So it goes back to what I said before then...you're advocating the artificial inflation of wages to meet the needs of the employee (essentially, advocating a system in which your employer works for you instead of the other way around).

I'm advocating a system in which the wage is dictated by the complexity and rarity of the skill required to do that job.

If you have a job that can be performed by a 14 year old with little to no previous training (who's more than happy to do it for $9/hour), then that job isn't worth $14/hour for a 35 year old who wants to do it.

I made reference to this in another thread, but there are ways to get out of minimum wage jobs...financially aid for education as well as student loans (that don't have to be paid back until 6 months after graduation) are readily available.

That's how I got out of my minimum wage gig that I had when I was 20.

...but the responsibility is still on the individual to take advantage of the things that are within their control.

Here's some interesting data to look at:
Tables 1 - 10; Characteristics of Minimum Wage Workers: 2012


- almost a third of minimum wage earners don't have a high school degree (making the choice to drop out of school or stay in school; or if you've dropped out, the choice to get a GED are within the individual's control)

- Even just an associates degree dramatically reduces the chances of being stuck at minimum wage (which is a very attainable degree, even for someone like myself who had to work during the day and take classes at night)

- half of minimum wage earners are between the ages of 16-24 (likely not supporting large families or working their way through high school/college)

 

[ThatRobGuy]

You lead a blessed life and you obviously don't have a lot of contact with a large number of Americans.

But since we are talking about treating people like adults: since when is it acceptable to say: "I wanna make a zillion trillion dollars and not pay for anything to help me make my money!"

Which is effectively what WalMart says when they FAIL TO PAY THEIR EMPLOYEES SUFFICIENTLY TO AFFORD BASIC LIFE MATERIALS.

As I noted in an earlier post, but WalMart employees have shown up often to be very high users of public aid. The study I cited earlier found that ONE WALMART SUPERCENTER in WI cost taxpayers $900,000 in public aid costs.

ONE WALMART SUPERCENTER.

Why? Because Walmart wants to make a zillion trillion dollars and they do that by NOT PAYING THE TRUE COSTS OF THEIR OWN BUSINESS.

So let's drop the whole "talk to adults" angle.

I'm seeing a LOT of special pleading on behalf of the wealthy here and almost no compassion for the poorest members of our society.

I see people lobbying on behalf of vast wealth and blaming the poor for their position.

I don't understand what kind of world one must live in to arrive at that position.

Actually, I used to be poor...

Grew up in a household of 5 that only had a household income in the 30k's...

No money for college from mom & dad so I had to take out large loans from the bank to pay for it and work full time during the day then take classes at night (leave at 6am every day, didn't get home until 10:30pm...wake up, repeat)

...is that the kind of blessed life you're referring to?

...and as I posted before, Walmart employees are the highest users of public aid because walmart is one of the biggest retail employers.

If walmart was replaced by 100 small retail companies, then instead of one company having 3000 people on public aid, we'd simply have 100 companies with 30 people a piece on public aid.

Retail is retail...it was never designed to be a high paying career path.

Not to mention, if the government forcibly disbanded walmart and 100 small companies emerged in it's place, it'd just be a matter of time before one of them would keep growing and growing and taking business from the others until we'd have another walmart again.

If Walmarts goal was strictly to get rich by underpaying everyone, then why would they simply pick one group of their employees to underpay? (the Retail workers)...why not not underpay everyone (the store managers make a fairly decent wage...their corporate employees make a decent wage...if the goal was really to just screw everyone over, wouldn't they be underpaying them as well?)