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Wages in the US
 Bahamut.Milamber
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By Bahamut.Milamber 2014-02-16 03:43:26
BK offering food 10% cheaper then McD and Wendy's would have a business advantage over them.
BK offering food 10% cheaper than McD/Wendys would only have an advantage if they saw a corresponding increase in volume, and if they had no expectation that their competition would also lower their prices.
They would have an advantage if they could increase their profit margin by 10% while maintaining the same volume, at which point they would have the option of lowering their prices and possibly capturing more volume.
But that also is based on having enough information to accurately predict that the prime differentiator between those companies is price. I'd wager that the existing prices are similar enough that it isn't.
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By Shiva.Onorgul 2014-02-16 04:43:10
The statistics behind minimum wage are actually quite staggering. I'll take some quotes directly from Forbes.com, but the story seems to be the same across all sites that I visit.
"Only .66 percent of full-time workers and 1.7 percent of full-time hourly wage employees earn the minimum. Just four percent of minimum wage earners are heads of households working full-time attempting to raise a family, less than the percentage for all workers. Most employees collecting the minimum are teens or young adults or are working part-time. As a result, a 2007 study by the Congressional Budget Office figured that just one-seventh of minimum wage increases went to employees in poor families."
"The minimum wage is no weapon against poverty. Explained Wilson: 'Since 1995, eight studies have examined the income and poverty effects of minimum wage increases, and all but one have found that past minimum wage hikes had no effect on poverty.'"
Who would be affected the most by a minimum wage hike? Not down-on-their-luck heads of households, but rather teens, young adults, and unions. Why unions? Because unions often negotiate pay based on a percentage above whatever the minimum wage happens to be.
What happens to teens when the minimum wage rises? That's right, teen umemployment rates skyrocket, especially for minorities, even in good economies. A thought occurs to me when reading this data: how many low income heads-of-household make more than minimum wage but less than $10/hour? For instance, in my state, as with many others around the Union, the state minimum wage exceeds the federal minimum wage. So it'd be quite easy for someone examining minimum wage statistics to use the federal minimum wage as their guideline and conveniently get to ignore places like California, Washington, New York, Ohio, etc.
Even if the data is based on the local minimum wage rather than the federal minimum wage, the point still stands. I have been forced down to the bottom of the workforce by circumstance and am temping. My co-workers and I regularly get paid state minimum, but we frequently get jobs that pay upwards of 55 cents over that, too. Working for $8-$9 means we're technically not at minimum wage, so does that mean we're not in those reports? The average teenager that's been working at McDonald's for 3-6 months has probably had a 25 cent wage increase in that same time (at least, when I was a teen and working in restaurants, I got a nominal raise in that time period; things may have changed in the past 15 years).
Just remember: it's easier to lie with numbers.
Additionally, even in the worst of the recession, it was rather common for businesses in my area who were looking to pay as little as possible but to still entice applicants to offer a wage of about a dollar over minimum, even for moderately skilled white collar work. I once applied for an office manager job that would have literally required me to be the guy running payroll, handling incoming calls, playing assistant to the local manager, and doing some sales on the side, all to the tune of about $9/hour (there was some profit-sharing chicanery involved, I think). They were looking for someone with a couple years of experience, no less. That's an extreme example, I'll admit, but it has become very common for that kind of work to pay as little as possible in spite of requiring several years of training and experience and, most likely, a college degree, so they look at what the local minimum wage is and throw a nominal extra amount at it.
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Bahamut.Kara
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By Bahamut.Kara 2014-02-16 05:17:13
The statistics behind minimum wage are actually quite staggering. I'll take some quotes directly from Forbes.com, but the story seems to be the same across all sites that I visit.
"Only .66 percent of full-time workers and 1.7 percent of full-time hourly wage employees earn the minimum. Just four percent of minimum wage earners are heads of households working full-time attempting to raise a family, less than the percentage for all workers. Most employees collecting the minimum are teens or young adults or are working part-time. As a result, a 2007 study by the Congressional Budget Office figured that just one-seventh of minimum wage increases went to employees in poor families."
"The minimum wage is no weapon against poverty. Explained Wilson: 'Since 1995, eight studies have examined the income and poverty effects of minimum wage increases, and all but one have found that past minimum wage hikes had no effect on poverty.'"
Who would be affected the most by a minimum wage hike? Not down-on-their-luck heads of households, but rather teens, young adults, and unions. Why unions? Because unions often negotiate pay based on a percentage above whatever the minimum wage happens to be.
What happens to teens when the minimum wage rises? That's right, teen umemployment rates skyrocket, especially for minorities, even in good economies. Quote: In 2012, 75.3 million workers in the United States age 16 and over were paid at hourly rates, representing 59.0 percent of all wage and salary workers. Among those paid by the hour, 1.6 million earned exactly the prevailing federal minimum wage of $7.25 per hour. About 2.0 million had wages below the federal minimum. Together, these 3.6 million workers with wages at or below the federal minimum made up 4.7 percent of all hourly paid workers.
Forbes article stats you quoted:
1. Looks at full-time workers. Which, I assume, uses the same criteria as the BLS.
Quote: Data are for wage and salary workers age 16 and over and refer to earnings on a person's sole or principal job.
....
The distinction between full- and part-time workers is based on hours usually worked. These data will not sum to totals because full- or part-time status on the principal job is not identifiable for a small number of multiple jobholders. Full time is 35 hours or more per week; part time is less than 35 hours.
....
Data exclude all self-employed persons whether or not their businesses are incorporated. These statistics do not include independent contractors (self-employed) as employers are not held to the same Federal minimum employment standards but independent contractors are included in total workforce numbers.
2. Forbes is only mentioning minimum wage workers, I'm not sure if they looked at below minimum wage earners (this includes a variety of workers, tip earners, teens who can be paid lower by law, disabled workers, etc). According to BLS table 1, ages 16-24 makes up 50.6% of minimum wage or below workers and age 25+ is 49.4%. Table 6 states minimum wage or below workers 72.2% have a high school degree or higher, 8% have a bachelor degree or higher.
3. As to head of household numbers; I don't know where they came from.
4. I don't think anyone would argue that teenagers/young adults are the first to lose employment opportunities when anything economically changes. It is one of the reasons the economists that visited Davos in 2009 started calling the 18-24 year-olds the 'lost generation'.
I don't mind forbes articles but the lack of citations in that article with the amount of numbers they kept throwing out was severely annoying.
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 Bahamut.Ravael
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By Bahamut.Ravael 2014-02-16 05:21:37
Actually Onorgul, I'm really glad you pointed that out. I had the same thought but haven't had the chance to find any sources to give me an answer. A few of the points that I referenced still stand regardless, but it does offer a chance for a more complex argument.
And Kara, I also would like to have seen more sources/citations from Forbes. I won't rule out the possibility that whoever wrote the article took some liberty with available statistics to paint a particular picture. I'd be a hypocrite if I said otherwise.
Bahamut.Kara
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By Bahamut.Kara 2014-02-16 05:51:31
Btw prices are pretty much determined by supply and demand.
No they are not.
Each market/product has different variables which affect the prices of goods. These variables can change over time and the effect they have on the price can change over time.
Some of these variables include: competition, ease of substitutes, inelastic and elastic demand, currency exchange rates, tariffs/taxes, political uncertainty, environmental, publicity/marketing, supply of raw materials or finished product, demand of raw materials or finished product, willingness to pay, inflation, etc.
Not to just Viciousss:
I know everyone likes to point to their Micro 101 class as being the key to understanding how the markets work, but it is a bit (just a bit >.>) more complicated than the theories you learned there. This article (it is on a blog that most will not like but there are citations if you would like to read more) gives a simple explanation of behavioral economics and how this relates to supply/demand theory.
Supply and Demand have underlying assumptions that must be satisfied for that theory (really hypothesis) to work.
Quote: It is important to note that the standard economic theory of supply and demand is based on the premise that consumers make rational decisions. It assumes that consumers are utility maximizers, and that they rank their preferences in a consistent way (ie. if alternative A is preferred to B, and B to C, then A is preferred to C). It also assumes that the supply and demand curves are independent of each other (that shifts in the supply curve do not lead to shifts in the demand curve).
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Today, an ever-growing body of research shows that human decision making is anything but rational. Standard economic theory and the law of supply and demand do not tell the whole story of what is happening in the marketplace. Consumers do not determine what should be produced and in what quantity. Instead, they can be easily swayed by clever marketing strategies. Corporations are spending hundreds of billions of dollars every year to influence public perception and induce consumer demand for their products.
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By Sylph.Buckets 2014-02-16 05:52:23
The statistics behind minimum wage are actually quite staggering. I'll take some quotes directly from Forbes.com, but the story seems to be the same across all sites that I visit.
"Only .66 percent of full-time workers and 1.7 percent of full-time hourly wage employees earn the minimum. Just four percent of minimum wage earners are heads of households working full-time attempting to raise a family, less than the percentage for all workers. Most employees collecting the minimum are teens or young adults or are working part-time. As a result, a 2007 study by the Congressional Budget Office figured that just one-seventh of minimum wage increases went to employees in poor families."
"The minimum wage is no weapon against poverty. Explained Wilson: 'Since 1995, eight studies have examined the income and poverty effects of minimum wage increases, and all but one have found that past minimum wage hikes had no effect on poverty.'"
Who would be affected the most by a minimum wage hike? Not down-on-their-luck heads of households, but rather teens, young adults, and unions. Why unions? Because unions often negotiate pay based on a percentage above whatever the minimum wage happens to be.
What happens to teens when the minimum wage rises? That's right, teen umemployment rates skyrocket, especially for minorities, even in good economies. A thought occurs to me when reading this data: how many low income heads-of-household make more than minimum wage but less than $10/hour? For instance, in my state, as with many others around the Union, the state minimum wage exceeds the federal minimum wage. So it'd be quite easy for someone examining minimum wage statistics to use the federal minimum wage as their guideline and conveniently get to ignore places like California, Washington, New York, Ohio, etc.
Even if the data is based on the local minimum wage rather than the federal minimum wage, the point still stands. I have been forced down to the bottom of the workforce by circumstance and am temping. My co-workers and I regularly get paid state minimum, but we frequently get jobs that pay upwards of 55 cents over that, too. Working for $8-$9 means we're technically not at minimum wage, so does that mean we're not in those reports? The average teenager that's been working at McDonald's for 3-6 months has probably had a 25 cent wage increase in that same time (at least, when I was a teen and working in restaurants, I got a nominal raise in that time period; things may have changed in the past 15 years).
Just remember: it's easier to lie with numbers.
Additionally, even in the worst of the recession, it was rather common for businesses in my area who were looking to pay as little as possible but to still entice applicants to offer a wage of about a dollar over minimum, even for moderately skilled white collar work. I once applied for an office manager job that would have literally required me to be the guy running payroll, handling incoming calls, playing assistant to the local manager, and doing some sales on the side, all to the tune of about $9/hour (there was some profit-sharing chicanery involved, I think). They were looking for someone with a couple years of experience, no less. That's an extreme example, I'll admit, but it has become very common for that kind of work to pay as little as possible in spite of requiring several years of training and experience and, most likely, a college degree, so they look at what the local minimum wage is and throw a nominal extra amount at it.
It also only mentions full-time workers. Most of the poorer people I personally know work 2 or 3 part-time jobs as top income earner for the family.
Bahamut.Kara
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By Bahamut.Kara 2014-02-16 06:10:53
The BLS statistics I posted and the forbes article also only discusses federal minimum wage. This means the statistics for state minimum wage earners are not listed in those statistics.
http://www.ncsl.org/research/labor-and-employment/state-minimum-wage-chart.aspx
22 states, according to that website, currently have a higher minimum wage than the federal limit.
Bahamut.Ravael
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By Bahamut.Ravael 2014-02-16 06:35:16
In other words, we're dealing with a very complex issue where it's difficult to take a side because nobody really knows what the actual consequences will be. I stand by my previous idea, though. Smaller, more frequent increases in the federal minimum wage based on inflation seem like a reasonable idea. If there's an argument against that, I'd really like to know what it is.
Another argument I've heard is to increase the minimum wage for people over a certain age. I believe 25 was the cutoff point. I'm not sure how that would pan out, because although it wouldn't kill the teenage employment rate like a regular minimum wage boost, it could cause problems for unskilled laborers over 25 looking for work.
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By Arziet 2014-02-16 07:16:25
If you read the entire thing you would understand I recommended putting the subsidized welfare program funds already being paid out to be re-diverted into subsidies to help higher wages. The companies do not loose money. Love when folks answer things they did not even take time to fully read. The USA is now competing in a world economy. The purpose of business's is to seek maximum profit, that means doing whatever they deem necessary. If they need to ship jobs overseas then they will do so. The only way to keep jobs local would be to provide incentives to hire local, and forcing them to pay ridiculous wages ($10 is f*cking ridiculous for easily replaceable unskilled labor).
I know most people here don't follow the finer details of world economics but I do. Manufacturing is finally coming back to the USA, plants are being built in the USA (in non-union states btw). This is because the rising middle class in China has raised the cost of production to a point where an advanced automated facility in the USA can produce the product at the same cost or cheaper then a less advanced manual labor driven facility in China.
A federal minimum wage as high as $10 USD would be giving an advantage to China and delay the return of the manufacturing jobs stateside.
So congrats you would score a "victory" that would cost your economy jobs and business in the long run at the expense of unskilled workers being paid more in service jobs that can't be shipped overseas.
EDIT: to keep response in one post.
the idea is not just an idea of minimum wage, as I would agree to keep the current wage min. for part time working class students. which may have to fall under the same stipulations that health care currently does of how to define "dependent student." Independent students who work full time and also struggle with balancing school full time with night classes would be categorized as independent adults. The issue I am posing is not just the minimum wage, but a "living" wage. One that makes sense if a full time independent worker who has to fully support a household, even if they are single with no children could do so. My thought is simply to re-divert funds from welfare which I believe only cause social apathy, generation poverty, and dependency on these programs.
My wife and I both work within and around these programs. Her as a assistance program worker, and myself with HUD. The system we have no is failing IMO to do anything but create the problems stated above.
Lakshmi.Saevel
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By Lakshmi.Saevel 2014-02-16 07:28:16
Quote: Another argument I've heard is to increase the minimum wage for people over a certain age. I believe 25 was the cutoff point. I'm not sure how that would pan out, because although it wouldn't kill the teenage employment rate like a regular minimum wage boost, it could cause problems for unskilled laborers over 25 looking for work.
That wouldn't work well as companies want to pay their people the lowest possible to retain them. This is the key point that most of the posters on this site don't understand. They attempt to vilify companies for choosing to pay their easily replaceable unskilled / semi-skilled workers so little, as though they are somehow entitled to some arbitrary payment. Supply vs Demand is what sets the wage for a particular job, not employee value. If there are 100 positions and 1000 people qualify for them, the company will pay the lowest possible to retain 100 people. It doesn't matter how difficult the job, its all about easily replaceable a worker is and everyone is replaceable.
If people want to have a high pay they need to learn to make themselves expensive to replace, or rather acquire such a skillset that many companies are head hunting you and thus your current employer needs to pay a high wage to retain your services. This is why I hate unions and am glad my field remains non-unionized. Union's fix wages based on seniority not on actual value, it protects older less skilled members from competition from younger more skilled members.
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By Arziet 2014-02-16 08:00:50
Saevel, I do believe that buying into the very mentality you seem to have is what brought America down to its economic knees. I am a 1st generation American myself, although my wife roots go back about 200 years in the states. Although i agree with a competitive workforce, being that I had to struggle and work damn hard to make my own way to find the comfort I have. I do realize that not everyone is able to push or drive so hard. I am so disappointed that my full post was simply chalk up to a minimum wage debate.
It is my fault, as I wrote it in a ranting manner after reading a silly article. I would just like to restate my main point again since it has been missed.
1. social welfare cost us a lot of money, which is primarily collected by the under-worked and underpaid low skilled labor.
2. The training programs we have for working men/woman seem to be doing little to lift families out of generation poverty as my wife and I witness everyday.
3. More and more families are joining the ranks of poverty requiring greater dependance on social welfare. Due to this I do not see this large part of our nations budget shrinking but rather growing.
4. IF we shrink the budget for these programs it has been proven that once a certain level of poverty has fallen below a certain line the apathy is broken and violence and crime ensues. Social welfare is not only to help out the poor but also to keep the poor content enough to avoid crimes of monetary opportunity.
5. IF we keep dumping blind money into a failing system with will only create more financial hardship for our country and create great dependency on these programs.
6. all that being said I believe that re-diverting some of these funds into a living wage program would allow some of the workers who are skilled and where valuable in their field before the economic downturn to lift their families out of poverty and dependence of social welfare.
7. I am not certain anything can be done to fix generational dependance on the system as it has already been ingrained in some families.
8. although i do believe as stated in #7 that something like this will prevent the rise of more families sinking into generational poverty.
9. These issues are more complicated than a morning coffee rant can repair but the discussion has to start some where. This is a global economy but do we really want America to fall more than we already have as a country of strength and values.
10. A strong nation, like a strong person, can afford to be gentle, firm, thoughtful, and restrained. It can afford to extend a helping hand to others. It's a weak nation, like a weak person, that must behave with bluster and boasting and rashness and other signs of insecurity. ~Jimmy Carter
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By Jetackuu 2014-02-16 08:28:57
Yeah, the social programs that are demonized so much, are basically just corporate subsidies because they get away with paying people too low.
That wouldn't work well as companies want to pay their people the lowest possible to retain them. This is the key point that most of the posters on this site don't understand. They attempt to vilify companies for choosing to pay their easily replaceable unskilled / semi-skilled workers so little, as though they are somehow entitled to some arbitrary payment. Supply vs Demand is what sets the wage for a particular job, not employee value. If there are 100 positions and 1000 people qualify for them, the company will pay the lowest possible to retain 100 people. It doesn't matter how difficult the job, its all about easily replaceable a worker is and everyone is replaceable.
No, people understand that companies do that, and that's why they vilify said companies.
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By Asura.Kingnobody 2014-02-16 08:50:43
Not likely since the cost of their food is not determined by labor costs but rather by their competition and what their customers are willing to pay. Any increased production costs, if substantial enough, would probably be offset by changes in labor. While true, increasing minimum wage effects all employers, not just your competition.
Since everyone's costs are going to go up, everyone's prices are going to go up, all at the same time. The amount that will go up will vary, and then cap at a specific amount due to, as you said, competition and consumer.
But since everyone's costs are going to go up (not just fast food, but everyone), and everyone's prices are going to go up, that is called (gasp!) artificial inflation!
Labor changes will also occur, but it will still be minor compared to the artificial inflation that arises.
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By Asura.Kingnobody 2014-02-16 08:52:01
Quote: Another argument I've heard is to increase the minimum wage for people over a certain age. I believe 25 was the cutoff point. I'm not sure how that would pan out, because although it wouldn't kill the teenage employment rate like a regular minimum wage boost, it could cause problems for unskilled laborers over 25 looking for work.
That wouldn't work well as companies want to pay their people the lowest possible to retain them. This is the key point that most of the posters on this site don't understand. They attempt to vilify companies for choosing to pay their easily replaceable unskilled / semi-skilled workers so little, as though they are somehow entitled to some arbitrary payment. Supply vs Demand is what sets the wage for a particular job, not employee value. If there are 100 positions and 1000 people qualify for them, the company will pay the lowest possible to retain 100 people. It doesn't matter how difficult the job, its all about easily replaceable a worker is and everyone is replaceable.
If people want to have a high pay they need to learn to make themselves expensive to replace, or rather acquire such a skillset that many companies are head hunting you and thus your current employer needs to pay a high wage to retain your services. This is why I hate unions and am glad my field remains non-unionized. Union's fix wages based on seniority not on actual value, it protects older less skilled members from competition from younger more skilled members. You got to stop bringing logic and historical facts to this website. Several posters can't handle it!
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By Asura.Kingnobody 2014-02-16 08:56:54
Another argument I've heard is to increase the minimum wage for people over a certain age. I believe 25 was the cutoff point. I'm not sure how that would pan out, because although it wouldn't kill the teenage employment rate like a regular minimum wage boost, it could cause problems for unskilled laborers over 25 looking for work. It wouldn't kill the teenage employment rate, it would kill the teenage unemployment rate.
Then we have a new issue: 25+ no-skilled employees unemployment rate will skyrocket. Those who tried to go to college and failed due to too many parties will see their lives shattered when they turn 25. Those that never tried in the first place would also see their lives shattered since the only skill they know is flipping burgers and running a cash register.
But it will define minimum wage's employment to what it truly is: A way for high schoolers or college students to earn a little cash on the side outside their studies. Not as a career goal to pursue and achieve throughout one's life.
And yes, triple post. Bite me!
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By kasain 2014-02-16 09:39:40
Any corporation who gets subsidies off the taxpayers in millions, should not have employees so low paid that they work full time or close to it and need government assistance.
In addition if a company pays under 5% tax or whatever number like GE, "General electric, 0% tax. They actually got a check from the government, and if any employee needs food stamps, housing or whatever off the government, again the corporation should be billed.
A nations offers a corporation its people, their education and its info structure to make profits off of. If the corporation does not pay tax or its employees need our help for basics then the corporation should be panelized.
I am not necessarily for minamum wage, but people who work should not have to rely on welfare for basic needs.
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By Odin.Jassik 2014-02-16 09:41:40
This is because the rising middle class in China has raised the cost of production to a point where an advanced automated facility in the USA can produce the product at the same cost or cheaper then a less advanced manual labor driven facility in China.
Just to clarify, the actual production costs are not that cheap, the lack of international shipping and tariffs makes domestic production cheaper. If you ask me, that's a good thing. Manufacturing jobs are largely unskilled but usually carry a more competitive wage and benefits package than other unskilled work. They also offer a density of employment that most jobs don't.
The big difference between US and Chinese manufacturing has to do with methods. In the USA we utilize highly automated production facilities with extremely high upfront capital costs but high production volume. China use's manual facilities with significantly lower automation in favor of using cheap human labor instead. Investing in China is cheaper then investing in the USA due to this difference in start-up capital. Business's aren't blind, they are constantly watching what's happening and trying to predict the short and long term future to best position themselves. They saw what union's were doing to US domestic production and chose to invest in an environment where unions couldn't hold their investment hostage. Quality issues can be factored into a cost analysis, a union manager shutting your production line down and costing you millions of USD can't.
Now that certain states have made it abundantly clear they want no part of unions, China is developing a middle class and starting to be belligerent towards foreign companies, there is an incentive to invest to exorbitant amount of capital into a high-tech automated production facility. These facilities require semi-skilled and skilled labor and often provide training programs for their workers.
The reason a national minimum-wage is such a bad idea is that it sends a message that the federal government is now going to try to legislate labor instead of allowing the states to handle it. That's a huge disincentive to companies to invest stateside where states often compete with each other to attract those business's.
Currently Texas, Georgia and Oklahoma are all growing local manufacturing base's. Arkansas, Alabama and Louisiana are all looking into altering their policies to try to attract manufacturing. Notice something all those states have in common politically.
I've been in a lot of manufacturing facilities in the last few years, and aside from automotive/electronic facilities, they aren't all that advanced. The facility I work in just bought our first high speed laser. I am pointing out how primitive the overseas facilities are in order for our to be much more efficient.
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also, for the people arguing over whether prices will increase if the minimum wage does. Most of the places that people think about when they hear "minimum wage" actually don't pay the minimum. As well, even if they did increase the minimum wage to above what those companies offer, the increase in cost to customer will be at a lower rate than the increase in labor. So, technically both are right, but raising the minimum wage won't actually help the poor. We need to be creating more skilled jobs, not paying unskilled ones better.
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By Shiva.Onorgul 2014-02-16 10:14:58
We need to be creating more skilled jobs, not paying unskilled ones better. While this is true and a big part of why earlier generations had an easier time supporting themselves was due to having a stronger manufacturing sector in the US, there's still a demand for so-called unskilled jobs that needs to be filled.
I see it every day and I wouldn't be surprised if you have, too. Trucks need to be unloaded, floors need to be swept, shopping lots need to be maintained, and snow needs to be shoveled. My family has a history of working with both children and adults who are physically and/or intellectually disabled. Some of them can do some of those menial jobs (though the Americans with Disabilities Act has made companies less willing to do so because of liability to lawsuit -- good intentions, lousy consequences), but not all of them, at least not at an appropriate level of speed and efficiency. So companies still need folks to do it.
To argue against my own point, though, I've noticed a lot of companies in my area who will pay above minimum wage for reliable, "unskilled" labor. No one will be sweeping floors for $20/hour, to be certain, but warehouses compensate decently for a strong back and an eye on product safety and construction companies are regularly looking for unskilled labor who may, in time, become apprentices and move up.
Not everyone can engage in what we call "skilled labor," though, in part because of the "labor" aspect. A remarkable number of women I've met are barely capable of lifting 30 lbs. on a continuous basis, so expecting them to unload 50 tons of semi tires from a truck is never going to happen (side note: I have done that and it really sucks -- humans are not meant to shift things heavier than themselves). Other people have disabilities or persistent injuries.
The question in my mind, then, is what constitutes unskilled work. Minimum wage largely applies to the service sector, everything from Wal-Mart to the local laundromat. We absolutely need bodies in there running registers, stocking shelves, and doing all the other little things that keep retail and service operating. Moreover, the service sector is one of the few places where a flexible schedule is possible. A mother who can only work part-time, a student (of any age -- if people are going to say "go to college," they need to remember that people do) who needs to juggle classes, or anyone else with other obligations to fulfill. Some of them might just need some pocket money or supplemental income, but not all, and is it helping anyone to keep them underpaid? It comes right back around because those people who essentially must do unskilled work will also be the ones applying for government aid, thus increasing everyone else's tax burden.
Those who tried to go to college and failed due to too many parties You live for making an *** of yourself, don't you? Your point is accurate, but the way you deliver it is just noxious. People pause their education for many good reasons, the kinds of reasons that can also put one out of the job market for a period of time.
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By Odin.Jassik 2014-02-16 10:24:41
Well, there's really no clear line between skilled and unskilled work as people put it. Yes trucks need to be loaded and unloaded (this could previously be done simply with a fork truck and 1 driver, but increased weight distribution regulations and fuel costs dictate hand loading many things now). So what we have done, at least in that arena, is reduce the number of skilled jobs and created unskilled ones.
I agree there will always be some dirty, crappy jobs that need to be done, that's not really the point. What we need to do is focus on the cultural stigma toward a lot of trade skills, because at this moment, there are millions of trade skill positions going unfilled. Creating reasonable paths to those skills for young people should be paramount.
Another big problem is that many of the low skill jobs (something that requires mostly OTJ or effortless certification like pest control or clerical) are either being outmoded or outsourced. Many positions have become so niche, there is virtually no market for those skills.
Bottom line, we need to focus on creating more mid-level jobs and providing paths to those jobs. A 4+ year degree is not reasonable for most of the kids coming out of school right now, their earning potential is as high or higher with a trade degree, and minimum wage jobs need to be first jobs or second incomes instead of the baseline for the next generation.
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By Thunderz 2014-02-16 10:26:04
People Making minimum (or slightly above that) most likely don't have a retirement plan provided by their employer
They are broke now and will be broke when they retire in Canada people like this end up using government subsidies (essentially a sort of welfare) because their retirement chq just doesn't cut it. So the concept of minimum wage by itself is not enough (even if bumped up to 14$/hr)
We need a better $/hr and retirement program (for everyone)
my 2cent (think this is a universal problem)
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By Shiva.Onorgul 2014-02-16 10:43:15
Bottom line, we need to focus on creating more mid-level jobs and providing paths to those jobs. A 4+ year degree is not reasonable for most of the kids coming out of school right now, their earning potential is as high or higher with a trade degree, and minimum wage jobs need to be first jobs or second incomes instead of the baseline for the next generation. This is exactly why I advocate specializing in high school or possibly even sooner. Our one-size-fits-all general education curriculum is really doing most people a disservice, as is the weird assertion that everyone should go to college. Academics like me are what post-secondary education is for. Many positions, even white collar ones, don't benefit meaningfully from it. It's why people look with so much askance on stuff like a communications degree (and why they totally misinterpret a bunch of arts degrees).
That said, I know a lot of folks with degrees and certificates and specializations who aren't using them. My brother has an associate's degree in video editing and some experience working in television but presently works with disabled adults and loves it. There's so many stories of lawyers opening bakeries and similar that I really do think that our approach to education (in re: employment) is flawed. It's not like someone who was trained as an electrician even 10 years ago can just jump back into the job because of how things change, though similarly someone who knows how an old furnace works is better equipped to fix it than someone who just finished training. It's all a bit muddled.
People Making minimum (or slightly above that) most likely don't have a retirement plan provided by their employer Retirement options here in the US are not very impressive, even for salaried workers. Pensions and the like are pretty much dead outside of government work (which is why government jobs are so sought-after in spite of having only middling salaries) and virtually everyone changes companies often enough that employer-provided retirement plans are a bad idea for everyone involved.
Bahamut.Milamber
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By Bahamut.Milamber 2014-02-16 10:57:33
It's not like someone who was trained as an electrician even 10 years ago can just jump back into the job because of how things change
That's not a good comparison, as the basic principles haven't changed and there hasn't really been a paradigm shift in how electrical installations are done (barring large scale projects). Local codes may have changed in the meantime, but it wouldn't take much to read up on what those changes have been.
By Arziet 2014-02-16 10:58:04
Even making a higher income and living a simple lifestyle, it is hard to save as much as we would like for retirement. With what they say inflation will do and how the dollar with depreciate by the time we retire combined with very small returns on safer investments we are just not sure no matter how much we save we will have enough. Not even sure social security will be worth much in 20+ years. My family is from Mexico so we may just end up retiring there, since we can stretch our dollar nearly 5-7 times there.
I agree it is not just an issue in the US, but a global issue. Not that I support the idea but I see many more countries nationalizing resources, increasing social welfare, creating trade barriers, and large scale market regulations. This global transition as at such a rapid scale along side the booming world population something has to give some where. Praying for better leadership in the next round of elections.
By Arziet 2014-02-16 11:06:42
It's not like someone who was trained as an electrician even 10 years ago can just jump back into the job because of how things change
That's not a good comparison, as the basic principles haven't changed and there hasn't really been a paradigm shift in how electrical installations are done (barring large scale projects). Local codes may have changed in the meantime, but it wouldn't take much to read up on what those changes have been.
I am a contractor myself, and these things change in small ways, but most the changes are more so streamlining the process to make the end result if projects to be the same regardless of which company is doing it.
I have to agree the skills once learned are very easy to reincorporate.
Side Note: The skilled construction field is becoming harder and harder to find employees in. With stronger laws in place and companies demanding fully licensed, insured, bonded, skill certified work it makes it super hard to find these people in the work place. After you find a couple of good workers 3/5 will fail a background check, drug test, or fail to have a clean driving record. IF you can make it past that point with a person the remaining 2 may or may not be happy with the wage. As the unions fall apart some of these guys loosing their jobs still expect $30-60/hr. I can barley pay my self those wages let alone anyone else.
Ragnarok.Azryel
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By Ragnarok.Azryel 2014-02-16 11:38:45
Minimum talent nets you minimum wages.
I’ve seen several mentions of the fast food industry in this thread, and if McDonald’s has come to be considered as a “career option” in this country, then we, my friends, have far bigger problems at hand.
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Bahamut.Milamber
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By Bahamut.Milamber 2014-02-16 11:40:15
Pensions and the like are pretty much dead outside of government work (which is why government jobs are so sought-after in spite of having only middling salaries) and virtually everyone changes companies often enough that employer-provided retirement plans are a bad idea for everyone involved.
The lack of stability is a pretty problematic sign. Unless the stars align, there is some measure of spin-up time before you get full utilization out of someone, and you have reduced efficiency as they exit a position. Employee churn is an expensive problem, particularly in areas where contracts have associated penalties for late delivery.
But speaking of retirement programs, here's yet another new trend from our corporate overlords which gives no benefits whatsoever to employees.
Bahamut.Milamber
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By Bahamut.Milamber 2014-02-16 12:07:21
Minimum talent nets you minimum wages.
I’ve seen several mentions of the fast food industry in this thread, and if McDonald’s has come to be considered as a “career option” in this country, then we, my friends, have far bigger problems at hand.
Such as looking down on people for the jobs that they perform?
Is there something particularly wrong with being a farm hand? A shoe salesman? A plumber/electrician/carpenter/general contractor? A welder? A rancher? An electronic component assembler? A seamstress/tailor? A photographer? A fast-food worker? A doctor? A lawyer (all jokes aside)? A janitor?
I'm in no way saying that you have to pay all of the above equally.
But you shouldn't be essentially stating that these people are worthless, or bring little to no value to the table.
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By Phoenix.Amandarius 2014-02-16 12:14:35
No one said they are worthless. That is straw man, brah.
That actually isn't the purpose of a business. The purpose of a business is to provide a service or product.
Ideally, the business will want to maximize its profits for a given set of variables; but that isn't the point of the business.
This seems to be something which is forgotten or misunderstood.
Asinine. The service or product is the means to make profit, which is the goal of business.
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By Sylph.Systematicchaos 2014-02-16 12:16:36
Minimum talent nets you minimum wages.
I’ve seen several mentions of the fast food industry in this thread, and if McDonald’s has come to be considered as a “career option” in this country, then we, my friends, have far bigger problems at hand.
Such as looking down on people for the jobs that they perform?
Is there something particularly wrong with being a farm hand? A shoe salesman? A plumber/electrician/carpenter/general contractor? A welder? A rancher? An electronic component assembler? A seamstress/tailor? A photographer? A fast-food worker? A doctor? A lawyer (all jokes aside)? A janitor?
I'm in no way saying that you have to pay all of the above equally.
But you shouldn't be essentially stating that these people are worthless, or bring little to no value to the table.
Some of those are worthy career options, but some jobs are not careers. They are jobs better suited to high-school age workers, or older people simply working for health insurance or to supplement what they already have. Working for McDonalds should in no way, shape, or form, be able to feed a family of 4, or 2 for that matter, unless they are ordering from you.
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Server: Asura
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By Asura.Kingnobody 2014-02-16 12:37:40
Phoenix.Amandarius said: »No one said they are worthless. That is straw man, brah.
That actually isn't the purpose of a business. The purpose of a business is to provide a service or product.
Ideally, the business will want to maximize its profits for a given set of variables; but that isn't the point of the business.
This seems to be something which is forgotten or misunderstood.
Asinine. The service or product is the means to make profit, which is the goal of business. Don't forget, profits are evil and we should arrest anyone who is trying to make money, for they are evil and should be punished/killed.
Edit: Sarcasm is hard.
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http://www.nationalreview.com/agenda/371175/federal-minimum-wage-too-high-long-term-unemployed-reihan-salam
Wealthy suggest a training wage under minimum wage to "stimulate" hiring and training of long term unemployed...
The real issue on bottom line profits are that consumer spending is flat-lined. This leads to business growing profits on the backs of employees with lower wages, less or no benefits, and only offering part time work. If a business is suffering from a lack of business caused by a lack of consumer spending, lowering the wage to $4 (training wage) an hour won't create any more jobs because business still isn't experience any increase in consumer spending. Where is the money coming from to hire new workers ? Instead business would just exploit this, replacing good paying existing jobs with lower paying jobs to streamline their profit margin. On the flip side, if the basic cost of living is $14 an hour for a single person working a full-time job as it is in most states, raising the minimum wage to anything less than this basic cost of living will also result in only negative consequences, ie. jobs cuts, reducing of hours, higher consumer prices, because still there is no increase in consumer spending for business to afford that. It is only after wage is higher than the basic cost of living that there would be an increase in business through consumer spending which could offset such a raise in wage. To be clear .... if it costs $14 an hour working a full-time job just for the basics in cost of living, they can raise the wage to $13 an hour and the only business that will benefit from that wage increase are landlords, banks, utility companies, transportation, and the tax man. The rest of the businesses out there are SOL because consumers still won't have one penny to spend stimulating the economy. This issue at hand is not an issue of class inequality, ie. rich vs. poor, it is an issue of inequality in wage vs. cost of living. Minimum wage is as counter-productive as the cost of living and they have no problem with the cost of living rising every year. They have allowed this problem to occur and have let it get out of hand. You can't fix this with education so everyone has a college degree because the payoff on that after a person pays off the debt of that education and is actually contributing to economy growth won't have results for decades. You also can't fix this problem with subsidies and bailouts, the ONLY solution is for wage to be higher than the cost of living so the result is massive consumer spending and real economic growth.
http://www.usgovernmentspending.com/year_spending_2013USpn_13ps2n_400010
Reason for using "~" is these figures (%) change quarterly and this is for general ideal.
The US government spends (Not including Medical, since my personal belief is everyone should have medical care) ~2.6% of the ~$16 Trillion (2.1% GDP impoverish family medical welfare, to make a point) ~416 Billion/yr (2.6%) & 336 Billion/yr. (2.1%). Also which is not listed under welfare spending but rather "Agriculture" spending are the food stamp programs which amount to ~80 billion/yr. totaling ~832 Billion/yr.
http://cnsnews.com/news/article/federal-food-stamp-program-spent-record-804b-fy-2012
http://aspe.hhs.gov/poverty/13poverty.cfm
The poverty guidelines in the US. are roughly $12k/yr. Single +4k/yr. per additional household member. This is the equivalent to having a part time job(32 hours a week) with no benefits at minimum wage. Consider ~15% of the US lives in poverty, with a population of 314 Million, nearly 47 million people live in poverty which in turn creates the need and dependency of social welfare. 22% of these citizens are children who have no recourse for their situation. Leaving ~36.5 million working age Americans in the pits - dependency.The government spends nearly $17-18k/yr. per individual person in poverty. This does not include tax subsidies for programs like EIC which pays out about 1.2 Billion a year to low income families with dependent children. This is small dent in the big picture. Link for reading.
http://www.pewstates.org/projects/stateline/headlines/a-renewed-push-for-earned-income-tax-credit-in-states-85899539729
Getting to the point, if we where to take the over 22k/yr. spent in welfare services and divert them into a living wage subsidy supporting a higher base minimum wage of nearly 2x ($14.5) the current minimum wage for persons who are working age (18+) [maybe keep lower minimum wage($7.25) for ages 15-17 who are restricted to part time and often live as a dependent]. we would in turn begin to nullify the need for such large social welfare. as this wage would create independent earning as well as stimulate economic growth via increased purchasing power.
Why should this be a government subsidy? Look, the government is already paying this money out. We know we can not trust corporate America to care for the well being of their country and those who work for them. A subsidy would both benefit employees and lesson the bottom-line of the employer.
I truly feel the original intent of social welfare has long been lost to the stepping stone it was meant to be. It has become a crutch for generational poverty and a means to create social apathy and dependency in the impoverished and working class of America.
If we can start to take the right steps now on matters like this as well as clean up some other issues in our country and government we may be able to set forth a bright and lucrative future for our children.
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