If people will do it for free, it is definitely worth less than $10/hr. If machines can do it for less than $10/hr, then when humans do the same labor, it is definitely worth less than $10/hr. How can you claim otherwise, without creating some special definition of “worth” that is different from what everyone else means by that word?
Remember, we’re talking about the value of their labor on the labor market, which is objective and quantitative, not their intrinsic worth as a person, which is subjective and qualitative.
Perhaps, but it didn’t really help, either. MW is like sticking your finger in the dyke when the water is rushing over the top. The problem is that we live in a world where people lack skills that employers value. Not just uneducated and lazy people, but high school graduates and people with college degrees who work their asses off just can’t compete with a machine or a pennies a day sweatshop worker in Cambodia.
And forcing people to pay their lowest paid employees more is like saying “let them eat cake”. It illustrates a fairly naive view of what is actually happening. The problem isn’t that heads of households who earn minimum wage aren’t making enough, it’s the fact that there are heads of households earning minimum wage at all. And raising the MW isn’t going to fix that problem, only exacerbate it.
Or, the problem is that the health and well-being of people and families has become more directly and universally tied to their value to employers at the same time that employers place less and less value on jobs at the bottom end of the income spectrum.
Can’t say this is the reason for sure, but one often hears about “non-agriculture payroll”, so there must be a reason in some instances for ignoring that sector.
In the industry I work in, which is apparently not large enough to be considered in government surveys, labor costs are around 90% of the company’s costs. Other than people, the only other thing the company pays for is a few computers and electricity. The company I used to work for claimed wages were 70% of their costs; most of the rest went to the mortgage and maintenance on the building.
Nobody gets minimum wage in these industries, though, so perhaps it is not really relevant to this discussion.
How does the government come up with those poverty levels? Here it’s pretty cheap to live, and a cheap apartment will only cost $5000 a year in rent. Which if you make $11,000 a year leaves you a $100 a week to spend on food, transportation, clothing, and other necessities. So you could live on $11,000 a year here. There are a lot of illegal immigrants who get paid less than minimum wage and seem to manage to scrape by. If they increase the minimum wage to $15/hr, I think many more businesses will turn to illegal labor.
However, where I used to live, housing was very expensive. Even the cheapest, tiniest, dump of a place would cost at least $12,000 a year in rent. If you only made the $11,000 poverty level, you’d be homeless.
Do I understand this correctly: you believe that minimum wage hikes will drive up unemployment and raise product prices, but you support it anyways? Why?
Dude, I don’t need a lecture on automation, particularly one that adds absolutely nothing to the discussion.
Not to mention that the marginal amount of automation purchased depends on the price of labor and the value of that labor. This is why there are still waiters and cashiers despite there being automated solutions that are much cheaper. The value proposition still doesn’t make sense in many cases because a robot is not a human.
But these increases are almost never overnight. For example, in CA, minimum wage won’t reach $15/hour until 2020 or 2021.
Yes, but the data is not really clear on when those behaviors become a net negative for society. That’s the crux of the issue. If $10/hour only means a few lost jobs that were crappy anyway, and it provides millions of people with a better life where they don’t have to rely on charity and government handouts, then we all benefit. If it means tons of businesses fold, then obviously we might be worse off. It’s really hard to guess what will happen, but most of the data I’ve seen seems to support the idea that raising it to around $10/hour will be fine.
My point is that these things were worth more before the machines showed up and made the particular task cheaper. With that said, machines dispense money and we still have bank tellers that dispense money. Machines can do my check out at the grocery and yet we still have cashiers.
I don’t think you can separate the two unless you have something like a basic universal income.
Our current minimum wage is notably lower on an inflation adjusted basis than minimum wage during the 1950’s. And of course I agree that our labor is overpriced if compared to labor in a poor underdeveloped country with no health, safety or environmental regulations where the median income is less than $1/hour. Dropping the minimum wage isn’t going to fix that. And a basic income is not sustainable if we have to let Cambodia compete directly with our labor.
There is little we can do to change heads of households making minimum wage short of protectionism. By global standards, EVERYONE in the USA is overpaid. Our doctors make too much, our lawyers make too much, our fast food workers make too much.
I can’t publish the data as it is confidential, but the software company I was VP Operations of (including finance) often had over 80% of costs going to salary and benefits. We had nobody earning anywhere near minimum wage.
Yeah, there are certainly fields in which labor is well over half, and sometimes a massive percentage, of total costs. Accounting, software development, sales, customer service are among them. They do not, to the best of my understanding, constitute a substantial portion of the labor market, nor do they generally staff at minimum wage (certainly excepting call centers and telemarketing slavepits).
Hate to beat a dead horse, but I just think spamforbrains’ argument fails here.
