I don’t think it’s fair to compare Wal-Mart to Costco. It’s like comparing McDonald’s to The Olive Garden. If anything you should be comparing Costco to Sam’s Club.
CostCo and Wal-Mart work on totally different business models.
I can’t justify paying the guys at McD’s a big raise. The people that serve me at the drive thru are just terrible. Last night I had to repeat my order 5 times at the speaker box. I pull up and they have a radio/mp3 playing in there. :dubious: Yeah, I could see why it was hard hearing the sign orders.
I’ve learned to double check my order on the McD’s sign before I pull up and pay. Even then my order occasionally gets screwed up when they bag it.
If McD’s pays 1.5 times min wage then they need to can the high school and college kids and hire older more professional service staff.
Using your own scenario, the first part of which is probably accurate, there will be no net additional wages to redistribute.
Wages may be higher, but they’ll be distributed to fewer workers. If nothing else, the social cost will be higher as a result of workers being laid off or stores closing.
The Forbes article was including Sam’s Club in its calculations.
BTW, don’t companies like McDonalds usually pay differently depending upon location?
I mean, I have to assume someone working at a McDonalds in Manhattan probably earns far more than that same employee at McDonalds in some small town in Mississippi. Still less than they need to survive, but I would imagine local economy does play a role in salaries, doesn’t it?
Sure it does, that’s one reason I got a real chuckle yesterday to see that McD’s workers in Kansas City were demanding $15/hr, along with workers from NY.
Yeah right…for $15/hr in KC, you better have a degree, be a skilled tradesman…or at least be more qualified than the minimum to work at MickeyDeez.
Actually most of their workers are adults, at this point. If you had to work three jobs to make ends meet, your attentiveness and motivation might be a little slipshod, too.
Why do you think they will lay off people just to cover the difference? It doesn’t make much sense business wise. True, the total change in net wages won’t be 150%, but it won’t remain the same either.
Fact: you can not raise a family on McD wages without government subsidies.
That was the point in the Walmart / State of California issue.
So your Big Mac, may go up 68 cents…but how much will your taxes decrease?
Or, as in California, what if the states charge employers like Walmart to recoup the taxes used to subsidize their under paid workers.
IMHO Minimum wage should be calculated on the % of employees at a pay level that require food stamps, subsidized housing, free schools meals, …
Ex: If in Iowa, X% of people making $7.50 hr, require government subsidization, then the state recalculates the min wage.
Exceptions: workers under 18, or college students under 26
The bottom line is column A vs Column B. Do you want to pay for these subsidies, or the employer?
Before you reply, note that in 2013, you were working until April 18 just to pay this years taxes. meanwhile. McD shareholders received $10 billion 2006 - 2008. The Kroc family were billionaires many times over.
And as far as these low wage jobs being “temp jobs”…sorry, but I know people with a Masters Degree working at Walmart for many years, while trying to raise a family.
As long as we keep moving $20 per hour jobs to China, for many, there is no move up from a position at Walmart or McD’s.
An McD recently opened in a small town near me. Hundreds of former factory and office workers applied for the very few min wage positions.
Our hard-headed friends who are opposing the idea of increasing the minimum wage are actually advocating continued taxpayer subsidies for WalMart and McDonald’s. Every entry level WalMart employee gets a packet of useful information that includes information like how to apply for food stamps, the locations of local food banks, and free (i.e., community/government subsidized) health care. That’s because they KNOW that their employees can’t survive on the wages they pay, that they must take advantage of what little social safety net we have in America to survive.
Essentially, WalMart is like a big industry whose operations pollute the environment, but which is unwilling to pay for the cost of that pollution, and expects government to pick it up for them.
Our anti-minimum wage hike friends clearly approve of this arrangement, the unwilling subsidization of the profits of Wal-Mart and other cheap-ass employers, extracting wages from the taxes you and I pay.
It’s really quite peculiar behavior, since people who oppose hiking the minimum wage also tend to oppose extending the social safety net. Perhaps some of them will care to explain themselves.
On edit, I see that cougar and i made the same point at about the same time, in different ways. GMTA!
Well, let’s look at this step-by-step.
1: McDonald’s raises their wages significantly above their competitors.
2: Most of the unskilled workers in the area now want to work at McDonald’s.
3: But demand for McDonald’s is fairly inflexible, and they’ve never had a problem getting enough staff. They’re not going to open new franchises just to employ all the people that are suddenly applying to them. Really, the only difference is that they’ll be able to be more selective about whom they hire.
4: But since it’s an unskilled job, there’s not really much room to be more selective. As long as you show up for work on time and don’t steal from the register, there’s not much more that McDonald’s asks of you. Most employees probably already meet this standard, and the only reason there are any at all is that it takes a little time to discover the problem and fire them.
5: So McDonald’s ends up with largely the same set of workers: Mostly conscientious, plus a few who aren’t and haven’t yet been weeded out.
Net effect, not much. Oh, it will have some effect: Some of those conscientious employees might be a little more motivated to try for Night Manager at McDonald’s, rather than going for a just-above-minimum position at some other company, which means that other companies will have to compete a little bit harder to attract employees at that level. But it won’t be much.
I don’t know I’n Out well enough to argue, bu this pictureof an In 'n Out drive through sign indicates that they are significantly more expensive than the McDonalds aound here.
Argh! I oppose minimum wage increases but certainly do NOT support continued tax subsidies of those working these types of jobs.
I don’t support either. I am not sure if I’m the demographic from which you were hoping to get an answer, but I have a lot of reasons why I think this is a bad idea. Mainly, these jobs are not appropriate jobs on which to raise your 2.4 kids in the FIRST place! These are entry level-putting yourself through college-supplementing your income-first job while still in HS type jobs.
1.5 times a McDonald’s wage still isn’t going to afford a family with kids a “living wage”. And it shouldn’t. This is the type of job someone works at, discovers “THIS SUCKS”! And then (via the incentive of not wanting to do THAT for a living), starts working on an education and toward a job that pays an actual (and comfortable) living wage.
With walmart, raising wages and benefits by a dollar/hr will increase prices by about half a penny per dollar. So if walmart offered an extra $5/hr in wages and benefits prices would go up 2.5% (A $50 item will cost $51.25, etc).
As others have said though, government spending would hopefully go down. I don’t know how much though if it did.
And the clientele at walmart and McDonalds is not really higher class. So raising wages there will, I am assuming, not really do much to decrease income inequality since you’d just be increasing prices on poor, working class, middle class and upper middle class people to give the money to the poor. To decrease income inequality you’d have to raise wages at yacht clubs, BMW dealerships and the like.
Ideally, but that assumes there are higher paying jobs out there. If they are not, then the person is stuck (unless they are somehow able to start a successful business, of which the majority tend to fail within a few years). When I was a kid being a paperboy was a job that kids did. Now I see adults doing them. Same with working retail. There aren’t a lot of high paying jobs out there. Even some educated professionals are having a tough time.
Someone on another website said just today that she lives in the Williston, ND area and McDonald’s had to bring in workers from Southeast Asia because they couldn’t find people to work there, even though they paid $15 an hour. 
BTW, they also provided housing, which is important if you live in a town where a 1BR apartment starts at 2K a month if you can even find one.
I think it was on “All Things Considered” where I heard an interview with a woman who was a schoolteacher and the family had relocated to Williston so her husband could work in the oil fields, and she did indeed work at McDonald’s because the hours were flexible (they had school-aged children) and truthfully, once child care and other incidentals were figured in, she would end up making more money this way.
The basic McD cheeseburger weighs 114 grams/ 15 grams protein (pdf) In N Out weighs 268 grams/23 grams protein.
Sorry I was at work. OP here. One topic of my original question that I was hoping would be debated but really hasn’t: If one giant company raised wages for their lowest paid workers, would that then force other companies to raise wages as well.
If only one company did it, then the other companies at the same old wage structure should have a harder time attracting motivated employees. I think it takes one company to bite the bullet and make the announcement, hand in hand with announcing that the CEO is taking a 2% salary decrease. Then many other companies will fall in line.
I think my plan would cause wages across the board to go up, particularly low income people at very little cost to the rank and file. Or is it just not that simple? I don’t see how companies don’t realize that my plan would really increase their bottom line and standing in their community.
The first reply questioned this. Why do you think this would happen?
If there aren’t enough jobs at the higher wage company I doubt it matters. Costco pays $17/hr plus benefits, a lot of other jobs pay $8/hr with no benefits for similar work and education/skill level.
But there aren’t enough costco jobs to make a difference. So I personally don’t think it would matter. People are already lining up for jobs at McDonalds, applications drastically outpace openings without the higher wages. What are the people at taco bell going to do, quit and work at McDonalds? They have to stand in line, and there are already a line of people willing to take over for that guy at taco bell.
However a labor union can affect those changes, from what I understand of them. If employers are afraid of a union moving in they will offer better wages/benefits to their employees to head the motivation to form/join a union off.