Having never heard this phrase “living wage” before, I checked the article linked in the OP.
The article states :
Does this mean a father, mother and two children ? Or does it mean one parent and three children ?
Am I right in saying that the proponents are suggesting that somebody who works as a ‘burger-flipper’ should be paid enough to support a spouse and two other children ? Where I live, ‘burger-flippers’ are school children and uni students (not including the manager). Shouldn’t you get a better job if you aspire to have a lifestyle that includes two children AND a spouse who stays at home to raise them ?
I wouldn’t shed a tear if the minimum wage was increased locally. Anyone who only pays their employees minimum wage is a dickhead who deserves to be driven out of business.
Productivity isn’t a good measure for all jobs.Jobs where specific tasks have to be completed , such as for example, unloading trucks, are different from jobs where a large part of the job is being present during specified hours, such as burger flippers,cashiers, receptionists If a worker suddenly learns to flip burgers twice as fast as he used to, you can’t simply pay him twice as much per hour and have him work half as many hours and get the same results.
They’ll only be able to quit one job if prices don’t go up. And if there’s a big jump in the minimum raise,they will. Because it won’t be only the minimum wage workers who’ll get a raise. Say the burger flipper is actually only making minimum wage, and gets a raise from $5.15 to $10.50/hr. You won’t be able to get supervisors at $7.50/hr or assistant managers at $10/ hr anymore. They’d rather flip burgers.If the assistant manager pay gets too close to the general manager’s salary, he’ll need a raise too. A modest .25/hr raise wouldn’t have this effect, but neither would it lead to people being able to quit one of their jobs.
Does anyone have a cite for how many people are paid the minimum wage, and not just a little above? I worked in fast food places all through college, and have relatives still working in service industries, and it seems that at least around here, most “minimum wage” jobs actually pay more than the minimum ( but still not enough to live on), at least after a couple of months. In which case a modest raise in the minimum wage might not have any effect at all. If the burger flipper is already making $6.00/hr, and minimum wage goes from $5.15 to $5.65/hr, he’s not getting an automatic raise.
It is pure arrogance to assume that you know what businesses can and can’t afford.
I’ve run small businesses where after all the bills were paid, there was barely a minimum wage left for me. If I had four employees and I was forced to raise their salary by .25 per hour each, I would have been out of business.
Economically speaking, when the price of something is set by supply and demand, then by definition there are people ‘on the margins’ who could not afford to pay a penny more. In other words, if you drew a graph, where the lines intersect you’ll find your marginal businesses. Increase their cost by even a small fraction, and you push them past the line and force them to cut their labor force or go out of business.
When the minimum wage is raised, there are two possibilities: 1) no one was making minimum wage in the first place, in which case the new minimum has no practical effect, or 2) you WILL cause unemployment.
There are no options for ‘taking it out of profits’, or businesses ‘finding a little extra money’. This is pure wishful thinking. If businesses has so much profit that they could raise wages, then the laws of supply and demand would have already required them to do so unless there is a huge labor glut. But if labor is scarce, then businesses have to compete for it. That means the cost of labor naturally rises to the point where businesses cannot justify paying a cent more. Force them to, and bad results happen.
Here’s another downside to minimum wages: They make the economy less flexible. Let’s say that everyone in an area is employed, and making $10/hr. So you raise the minimum wage to $10. Now the economy tanks, and profitability falls. Without a minimum wage, businesses have the option of lowering wages to compensate. But if they hit a legislated wage floor, then the only option left is to cut the amount of labor they pay for, either by cutting hours or laying people off.
There is no such thing as a free lunch. You can not make people richer by passing laws.
Maybe I’m just a cold hearted bastard, but maybe a couple with two children should consider their monetary position before having said children. Why should the government subsidize their choices in life just because they are poor ones?
I did that. Not flipping burgers, but working in an office. I did it for seven years, going from $10/hr to $12.60. During that time, we went from no kids to three kids.
It was in 1998-99 that I took some computer programming courses and started earning significantly more.
I would like to believe this, Sam, and in fact I imagine it’s generally true. And yet we have Wal-Mart, the nation’s largest private employer, embroiled in a bunch of lawsuits about stiffing their hourly workers. This leads me to believe there’s something wrong with the current system of wages; however, I agree that you can’t create wealth by fiat.
Supermarkets and grocery stores run on very low margins. Typically they only make a few cents on the dollar. They also happen to be one of the largest employers of minimum wage workers.
Good for them but Federal jobs don’t have to worry about market forces like businesses do. They collect taxes, set a budget and run a deficit if they have to.
Anyone who pays more than market wages is a naive fool who WILL be driven out of business unless they have a way to offer a superior product or service.
I’m a little disappointed that no one answered my question on what a “living wage” actually is.
No, but you could have half as many people working per hour on that shift. In the case where there is only one person, maybe they could start to do other more skilled tasks with their free time.
There can be some confusion here because I was addressing someone who was arguing against any minimum wage increase when the OP talks about an instant jump that doubles it. I’ve argued against that jump but have pointed out that there are trade-offs either way.
I don’t see why the proportion of people that lose their jobs wouldn’t be close to the number of people who could quit one job or at least work fewer hours.
True, but in the long run it raises the bar. Significant, steady, and modest increases eventually raise the wages of others near the bottom.
Sam Stone,
I’m actually currently working in my own business, I have a clue. Considering the amount of hours that I’ve put in, I sometimes make less than minimum. But I wouldn’t build a business model on paying people that little. It’s unethical in my opinion. If they can only earn you business minimum wage, hire somebody better. Folks like McDonald’s have structured jobs purposefully, so that any trained monkey can get the job done. It makes for a high profit margin, but simple jobs where even high school kids don’t work to their full potential.
Let’s talk about what you said, 4 employees at 40 hours plus an extra .25/hr. This comes out to about 40 bucks a week and a 5% raise in labor costs. Can you afford to fire one of these people? Probably not. This would cause a 25% labor reduction far in excess of that persons hours. More than likely you would cut hours and find ways to make your employees more productive. This is a bit nebulous,I know, but you haven’t said anything about what kind of business you’re in. In the case of a burger joint, some people will work fewer hours and only come in during the very peak hours. Those who are left will find ways to make work more efficiently and take on more responsibility.This is only fair since they’re making more money. I’ve seen this happen, it’s not magic.
Even if it did cause a business to go under, I think another one that was more competitive would take it’s place. If you think it’s fair for a worker to be held to supply and demand why not a business?
Most of the businesses that I’ve worked for, even the small ones, had a much larger room for error. Income could vary from week to week on a much larger margin than 40 bucks a week. A single sale or foul weather could have much more influence than that.
I’ve seen plenty of waste and ill spent money in any business I’ve ever worked for. Yet they still manage to be quite successful. Your belief that are already regulated market somehow guarantees perfect eficiency is obviously false. Otherwise, there would be no room for innovation or improvement in the way that people run businesses. Yet this happens all the time.
I think a rise in minimum wage should have very little effect on the economy since hopefully few people are making that anyway. Minimum wage raised during the Clinton years, yet the economy was still booming and the jobless rate was relatively low.
Minimum wage laws are not intended to help low-paid workers; they’re intended to protect well-paid workers from competition, in particular, union workers.
How do I know this? Because the legislation typically does not make exceptions for those who would be quite happy to work for lower-than-minimum wages, such as:[ul][li]Those whose income supplements a main earner, such as a spouse[]Those whose work may not be worth minimum wage, like a temporary worker or a teen-ager []Some part-time workersRetired people[/ul]By the way I was fired from a summer job at a small costume jewelry plant, when the minimum wage was raised from $1.00 to $1.10 many years ago.[/li]
It’s silly that a retired person can be a volunteer in a hospital, but cannot be paid a small amount for her work. It’s silly that a young person can be paid less than minimum wage only be going through the rigamarole of defining the job as “internship”, rather than work.
Ok, msmith. Here is WV_Woman’s official definition of a living wage:
I think a living wage is the amount of money per hour it takes in your area to keep you off of welfare. If you are paid a living wage, you should be able to feed yourself, clothe yourself, have some form of transportation and live in some kind of habitation that is decent. It doesn’t have to be the Taj Mahal but it should be habitable.
I’m in a household of 3. For us to simply pay our bills requires about $1100 a month. I realize this sounds nuts to some people but we do not have a car payment, and thus don’t carry full coverage on the car, and we have a VERY small house payment. That makes a big difference. So in the city I live in, I’ll take a stab and say that for a household of 3, you would need a take home pay of at least $2200 a month, minimum.
Now ask me how many jobs in West Virginia provide that
Just like if you are planning to have kids, you should factor your income in…if you are starting a business, you should factor paying living wages for your employees into your business plan.
Perspective, you don’t understand that your ‘waste and money ill spent’ argument is nothing more than wishful thinking. You don’t like it that people make as little as they do. So you want a law passed, and ‘waste and ill spent money’ is the imaginary source of wealth that will provide all this extra dough.
No, businesses are not 100% efficient. That’s not because they’re all a bunch of slovenly slackards who would rather be lazy than make money. It’s because running a high-efficiency business is damned difficult, and most are not managed that well.
There’s nothing about increasing the minimum wage that will magically improve the management skills of these companies. They’ll still be wasteful, and they’ll still have to lay people off.
And what’s this nonsense about it being immoral to have a company that pays people minimum wage? What if there is a product that is only deliverable if the people involved make that much? Are you saying that the world should just do without it? Even if people want to do the job at that price?
This is a ridiculous argument. Businesses like fast food outlets are extremely labor intensive. Small increases in labor costs get reflected in higher prices. Yet, the consumers that buy their product have limits to what they can afford. There are no magic solutions here. Raise the minimum wage, and companies that hire minimum wage laborers have to increase their prices. If that makes them uncompetitive, they go out of business. They don’t magically become more efficient, or somehow learn to be just as productive with less labor. Some may be pressured to find some increases in efficiency, and others may buckle under the pressure and fold an otherwise profitable organization.
And let’s remember that we’re not talking about people starving here. That ‘living wage’ is about three times the average income for the rest of the world. Even the poorest in the U.S. live lives of incredible wealth compared to the average person in the 3rd world. So it’s not like we’re at the breaking point here. A minimum wage that high is nothing less than an attempt to redistribute income, and not part of a social safety net which is what the minimum wage was supposed to be.
Chris Rock said it so I’ll quote: “When somebody pays you minimum wage what they are saying is ‘Look, if I could pay you less, I would, but it’s against the law.’”
Maybe my attitude towards this is colored by the experiences I have had. Every single employer I have ever known to pay minimum wage has been a complete SOB who thinks that their employees should thank God that they’re working for them and earning a whole $5.15 an hour.
In my experience, the lower the pay, the worse the employees are treated.
They should be afforded whatever someone is willing to pay them, not what the government forces people to pay them.
Many businesses gave signing bonuses and much higher salaries. The secret is that the people applying for the job have to ask for them. You can’t expect a business to willingly cut profits if they do not have to. But if there are more jobs then workers, the workers have the power to make demands.
I am all for that. If they come up with the decision on their own, without governmental interference, that is great.
This could work if businesses chose to do it on their own, but the government should not force them to. A business can choose to pay according to how much gets done rather than the time spent doing it, and this can lead to increased productivity (and less time typing messages on the Straight Dope during work hours).
True, but if it costs $13 for a #6 and a Coke, then many people will just decide to cook their own burgers made from foreign grown cattle.
This is caused by the silly belief that you don’t really have a skill unless you have a piece of paper to prove it. Businesses would do well to stop believing this falsehood. As someone once told me, “College is the greatest scam this country has going.” You spend all those years in school learning very little and get paid so much more just because you have a degree. Everything I learned in undergraduate school I could have learned in a few months tops. It is the degree, not the knowledge and skills, that people look for.
My thought exactly.
I do.
You are not the only cold-hearted bastard with this point of view.
Businesses are always held to supply and demand. The trouble comes when the government steps in and throws the whole supply and demand curve askew.
Please make this connection a little clearer for me. Minimum wage has consistently been far below union wages. The living wage idea comes closer, but you could also look at it as simply giving everyone the equivalent of a union job. It seems like this would actually hurt unions as no one would want to pay their dues anymore.
[QUOTE]
How do I know this? Because the legislation typically does not make exceptions for those who would be quite happy to work for lower-than-minimum wages, such as:[list][li]Those whose income supplements a main earner, such as a spouse[]Those whose work may not be worth minimum wage, like a temporary worker or a teen-ager []Some part-time workers[/QUOTE][/li] Quite happy huh? Ask people already working for minimum wage if they want to take a pay cut and they’d say “Sure I’m already making too much money!” Right.
As for the ones who aren’t working, the first two presumably have the option not to work if the minimum wage is too low.
Please support your assertion that teenagers and temp workers are only worth minimum wage with something besides the tautological “that’s what they get paid.” Productivity figures would be helpful.
I’ll buy the senior citizen argument as hopefully they’ve already socked enough money away, and they’re not working for a living.
OK so if you say that it affects African Americans unequally than you have to say that people are not paid what their worth already or that African Americans are just worth less (I won’t go there). So the argument that people with minimum wage jobs could not be worth more than what their paid instantly goes out the window.
But let’s take a look at some “evidence” presented from your links.
"But as the minimum wage rose in the 1960s and 1970s, the unemployment rate for blacks roughly doubled compared with whites – to 37.7 percent for black teens by 1980, compared to 18.5 percent for white teens. "
Maybe Walter Williams makes a better argument somewhere else, but this alone is laughable. There were millions of things affecting the economy from the 1960’s to the 70’s. I suppose you could also link unemployment to the rise in popularity of the drug culture if you wanted to.
"According to the Employment Policies Institute, 215,000 additional jobs for teens should have been created in 1995, but the minimum wage hike that year killed them – a 3.5 percent drop in job opportunities. " OK according to people who probably have never published a study that said raising the minimum wage might be good for anything, there might have been additional jobs created and somehow these imaginary jobs that never happened were cancelled out by the minimum wage increase. How convincing.
Temp worker checking in here. Most temps are highly skilled and most of the time when I go to a new place, I end up doing the job better than the regulars.
