Minimum Wage - the fallout!

[Commander Keen]

So, you would rather the govt. subsidize income for those working minimum wage jobs?...and somehow raising the minimum wage to a point where people don't need govt. assistance won't work either? You can't have it both ways...if you want droves of people off govt. assistance the minimum wage will have to go up substantially.

Some people, it seems, are doomed to forever be a drain on society. They simply don't want to put in the work necessary to get of the government teat.

Many people think they will make more I'd the minimum wage goes up. For a short while after a minimum wage hike that could happen. Then prices for goods and services will increase to offset increased costs due to the higher minimum wage.

The folks at the bottom of the barrel will still be at the bottom, but what has happened to everyone who makes more than the minimum wage? They've essentially taken a pay cut, because their wages haven't gone up (unless they're union, and their wages are tied to the minimum wage) but prices for goods and services have.

And we haven't even mentioned increased competition for these jobs due to the wage increases. People who wouldn't take a given job for $8/hour all of a sudden might not think that job is beneath them at $15/hour (even if their buying power won't have increased much, if at all).

And what about automation? A kiosk or automatic burger maker doesn't complain, doesn't no-call-no-show, or need benefits to work. The costs for these machines are coming down all the time, and higher operating costs associated with human workers make the RoI look pretty goods after a while.

Will the people who refused to learn to do anything other than make fries or take an order be qualified to operate or repair the automated equipment that replaces them? Highly doubtful.

Lastly, let's assume that these workers get an increased wage and do start bringing in substantially more money than before, with no downside. How many if them have the financially savvy to parlay those increased funds into something substantial (retirement fund, college fund, paying off existing debts, etc.) rather than big screen tv's, a fancy new car at 10% interest for 7 years, or some other status symbol? I know it doesn't account for everything, but many poor people are that way because they make poor choices and do not live within their means.

*whew*

 

[dennishoddy]

And what about automation? A kiosk or automatic burger maker doesn't complain, doesn't no-call-no-show, or need benefits to work. The costs for these machines are coming down all the time, and higher operating costs associated with human workers make the RoI look pretty goods after a while.

Will the people who refused to learn to do anything other than make fries or take an order be qualified to operate or repair the automated equipment that replaces them? Highly doubtful.

There are those that will step up and get the education and subsequent pay of a skilled labor to repair these machines. Automation doesn't always take jobs away. It provides incentive to get out of the burger flipper jobs.

 

[Commander Keen]

There are those that will step up and get the education and subsequent pay of a skilled labor to repair these machines. Automation doesn't always take jobs away. It provides incentive to get out of the burger flipper jobs.

If these people are so willing to step up to get the training for that higher-paying job why wouldn't they go ahead and do that for an existing job? Why wait until they're about to be replaced by a machine due to a minimum wage hike?

 

[YukonGlocker]

You can't drive people off subsidies by giving them more.

Earned wages aren't subsidies.

And what if raising the minimum wage doesn't help either. The article in the OP shows evidence that it may not. It shows that at least some people are still getting assistance and just working fewer hours.
How is that better?

For most people making minimum wage, doubling their salary would place them at an income that is above the level required to qualify for govt. assistance. There will always be con-artists, but a story about a few people working around the system doesn't at all explain how the system is affecting the vast majority. Again, what is the prevalence of such behavior? Most jobs actually require you to be a work for certain number of hours per week, or you'll be fired...one can ask to work less, but very few companies/employers will entertain such ridiculousness because they'd have to hire more employees.

 

[dennishoddy]

If these people are so willing to step up to get the training for that higher-paying job why wouldn't they go ahead and do that for an existing job? Why wait until they're about to be replaced by a machine due to a minimum wage hike?

Its not the burger flippers that typically step up, although I'm sure some see the light when the option is no job, or the opportunity to get ahead in life. Not all burger flippers are neer do wells. Some may have been forced into that situation. There are state programs that offer job training if a person wants to change the field of work they are in.
When I said "there are those" I wasn't pointing out any demographic.

 

[YukonGlocker]

...Lastly, let's assume that these workers get an increased wage and do start bringing in substantially more money than before, with no downside. How many if them have the financially savvy to parlay those increased funds into something substantial (retirement fund, college fund, paying off existing debts, etc.) rather than big screen tv's, a fancy new car at 10% interest for 7 years, or some other status symbol? I know it doesn't account for everything, but many poor people are that way because they make poor choices and do not live within their means...

I won't lose any sleep over what they, or you, or anyone, is spending money on. People working full-time, and currently in poverty because they are stuck in a minimum-wage job (among many other reasons, many not because of personal issues/choices), will use the income to *not* live impoverished. What kind of life could you afford on $1256 per month (current minimum wage) or even $2600 per month (proposed minimum wage), especially if you live outside Oklahoma in places where the cost of living is much higher?

And nobody, yet, has addressed the issue of the govt. subsidizing most everyone now making minimum wage. Corporations/big-businesses are receiving govt. subsidies that make minimum-wage earners seem like a drop in the ocean...if you're advocating for shutting off the govt. subsidy faucet to those in poverty, why not advocate the same to corporations?

 

[Commander Keen]

And nobody, yet, has addressed the issue of the govt. subsidizing most everyone now making minimum wage. Corporations/big-businesses are receiving govt. subsidies that make minimum-wage earners seem like a drop in the ocean...if you're advocating for shutting off the govt. subsidy faucet to those in poverty, why not advocate the same to corporations?

I hadn't even started in on the concept of corporate welfare, but why again are so many grown adults who may well have a family doing the low-to-no-skill low-paying jobs that used to be almost entirely the domain of high school and college kids?

 

[YukonGlocker]

I hadn't even started in on the concept of corporate welfare, but why again are so many grown adults who may well have a family doing the low-to-no-skill low-paying jobs that used to be almost entirely the domain of high school and college kids?

"grown adults": There's lots of reasons why that I'll try to detail later if I have more time.
college kids (you mean adults?): if you keep them at current minimum wage, they'll be sucking the govt. tit to pay for college

 

[Defnestor]

Raising the minimum wage raises all wages, even jobs that are not union-tied to the minimum wage, must pay more or employee satisfaction will plummet, and productions will suffer. So the miner gets a raise, and the truck driver gets a raise, and the guy at the forge gets a raise and the guy stamping spatulas out of steel gets a raise, and the food service supplies warehouse forklift driver gets a raise, and the clerk at the supply store gets a raise, and so the price of a spatula goes up before it even gets into the hand of the burger-flipper. Therefore, the price of a burger nearly doubles at the few restaurants that can afford to remain open. Suddenly a bunch of people are without work, and the higher prices of everything (including burgers) drives the cost of living up, until the government handouts have to be adjusted so the unemployed poor can buy a burger.

Naturally, if there were not minimum wage law, companies would pay almost nothing, because the best business strategy is to make sure your employees are too unmotivated to perform and bitter enough to drive all your customers away. The company I work for hunts for the best talent, and pays for it. We have to keep raising our prices to balance our workload. If we could find enough qualified people, we'd expand even faster. Too many people are content to draw government checks or want to coast on minimum wage (at least once it magically gets large enough to provide their wants and needs), to become skilled enough to be desirable employees.

 

[Sanford]

IMO, it's just going to cause more people to fall into poverty. The bottom end moves from $5 to $15. The next step up gets a bump from $6 to $16. The higher the bump goes, the lower the percentage of increase. Very shortly prices increase across the board to make up for all the bumps. Net result? Average buying power at all levels decreases due to the "compression" (making the lowest earners closer to the average earners). The subsequent decrease in "value" for education and skills training (why should anyone work hard to earn so little more than those who didn't?) will in turn create more of the "lowest" earners. And the cycle will keep repeating as long as a government minimum wage exists. Perhaps the best thing the government could do would be to gradually phase out the minimum wage entirely, allowing the market adjust appropriately.