Fast Food Workers Demand Higher Wages (to rent, loans, buying a home)

[Seth Parker]

Originally Posted by Tourian

People who work commission and earn tips would not be affected. There are already exemptions in writing that allow restaurant owners pay waitresses and bartenders less then minimum wage legally.

That's true, but wouldn't their minimum also go up? They have a server minimum that is legally set. I would assume that they would get the same treatment of an increase. Even if that weren't the case, a restaurant's labor is in the kitchen along with managerial staff. Again, costs would go up, prices would go up. There's no denying that.

Originally Posted by Tourian

That's the line, yes. That's what they want you to believe. Everything will just get pushed up that much more money as if it didn't happen. But it isn't true. But, like I said - we can just wait and see what happens in SeaTac. I loved while watching Fox one day as the pundits brought all the arguments presented here as definites, but one guy finally said, "Isnt this what America is all about?" I'm paraphrasing. "A group of people have decided to try something and we are seeing democracy at work. Let's just wait and see what happens."

First, who are "they"?

Second, link to where what I said isn't true? Every national minimum wage increase....ever causes the same things to happen. Inflation goes up. Prices go up. Corporations look for ways to offset labor increase via automation and outsourced work. That's not "what they want me to believe", it's fact.

The problem with individual minimum increases for a particular locality or business is that it's just that. Local. I have no doubt that it can work for certain businesses and places because that doesn't shift the entire national economy. Once it's regulated nationally, that's completely different.

[Seth Parker]

And let me be clear about one other point. I'm not against a higher minimum wage exactly. I'm against a nationally regulated higher minimum wage, especially one as drastic as jumping to $15. I would prefer it if each county/city/parish set their own minimum. That way, it's taken into account their current economic factors and costs of living. $15/hr in Limestone County is much different than it is in LA.

[Tourian]

Originally Posted by Seth Parker

And let me be clear about one other point. I'm not against a higher minimum wage exactly. I'm against a nationally regulated higher minimum wage, especially one as drastic as jumping to $15. I would prefer it if each county/city/parish set their own minimum. That way, it's taken into account their current economic factors and costs of living. $15/hr in Limestone County is much different than it is in LA.

I could get on board with that, but it shouldn't matter either way according to you. The local economy would adjust by raising the cost of goods and services until the new wage is too low again. Up until now, the minimum wage has crept up a few cents at a time. And over the years inflation has caught up. I've never seen this type of bump in wage implemented and the market immediately respond with that much more in gas, food, utilities, etc etc.

[Nlambert]

So here is one personal example that I can use when I managed a precision machine shop here in Huntsville two years ago.


I supplied literally hundreds of different aerospace parts for a local customer. We started to see material increases which dropped our margins well below acceptable levels. We were in the process of trying to go through various process improvement exercises to reduce our cost and keep customer pricing the same. We were already cutting back raises (as one piece to the puzzle) to help stabilize overhead rates. The customer came to us asking for a 3% price DECREASE on top of all this. No matter how I spun it, I couldn't come up with any way to get enough of a cost savings to be able to get our margins in the stable range and give the customer a 3% discount.

I looked a volume pricing, cheaper material suppliers (which the customer would not approve because they did not meet specs.... IE cheaper material = cheaper product), and even automating some functions to increase productivity and decrease operational costs. The money just wasn't there. Eventually we just had to tell the customer that not only could we not give a decrease (owner didn't want to cut jobs to automate), but we actually needed to increase pricing. The customer warned that if we increased pricing they were moving to another supplier. I took this as my queue to leave, and I did. But..... the customer eventually made good on that promise and left. The company still struggles to recoup the lost revenue.

I say that to say this. You can guess all you want at how raising the cost on a company by increasing minimum wage in an area that has little room for wage increases will affect the economy all you want. But just like the company I worked for these companies have to make a profit to continue to operate. And customers who aren't willing to pay the higher price will find other companies who offer similar products for better prices. We're already close to seeing fast food prices match sit down restaurant prices.

Buying cheaper materials (lower quality meats, buns, chicken, potatoes, etc...) will not go over well with customers. (Remember Taco Bell and the B or C quality meats?) Customers want cheap prices with decent quality. You cannot have all of that without keeping costs down, which includes wages. So where do they cut costs? By automating processes and eliminating jobs. If you don't think it will happen, think again. The robot we needed to do the job of two people was $40,000 in 2011 (or one machinist's yearly salary) and would do the job of two people. If one machine can do the same job as 2-3 people then automation is a no brainer. One machine would yield an RTI (return on investment) in less than 14 months. That is perfectly acceptable in most company's eyes.

At the end of the day companies are there to provide products to customers who want them. If the company needs to remain profitable and cannot afford to buy cheaper products, the last place they can cut costs is through labor. We will see these same people bashing companies soon because they no longer have any jobs.

[Seth Parker]

Originally Posted by Tourian

I could get on board with that, but it shouldn't matter either way according to you. The local economy would adjust by raising the cost of goods and services until the new wage is too low again. Up until now, the minimum wage has crept up a few cents at a time. And over the years inflation has caught up. I've never seen this type of bump in wage implemented and the market immediately respond with that much more in gas, food, utilities, etc etc.

There's a big difference. This way lets the free market work more than just a nationally regulated minimum does. LA's cost of living is much higher than ours. If their minimum went to $15, in all honesty, it probably wouldn't make that much difference out there. Move the minimum to $15 in some backwoods Louisiana/AL/MS town where the cost of living is extremely low and the poverty rate is above average, cost of goods will shoot up and any businesses already running on tight margins could be forced to shut down. A variable minimum allows them to fight through all of this.

[Tourian]

Originally Posted by Seth Parker

There's a big difference. This way lets the free market work more than just a nationally regulated minimum does. LA's cost of living is much higher than ours. If their minimum went to $15, in all honesty, it probably wouldn't make that much difference out there. Move the minimum to $15 in some backwoods Louisiana/AL/MS town where the cost of living is extremely low and the poverty rate is above average, cost of goods will shoot up and any businesses already running on tight margins could be forced to shut down. A variable minimum allows them to fight through all of this.

Big chains like Wal-Mart and McD's have the ability to not be affected by just one market. A Big Mac costs the same in Podunk Lower Alabama as it does in Los Angeles.

Prices may vary in Hawaii and Alaska.

[Nlambert]

Originally Posted by Tourian

Big chains like Wal-Mart and McD's have the ability to not be affected by just one market. A Big Mac costs the same in Podunk Lower Alabama as it does in Los Angeles.

Prices may vary in Hawaii and Alaska.

No..... they don't. You can even see this in Huntsville. Compare the price of a chicken sandwich at BK on University, Pratt, and Winchester. Winchester's BK is ~$1.00 more. That same chicken sandwich is less in Monroeville, AL (aka "Podunk Lower Alabama" as you call it) than it is in Huntsville. Take a ride and come back with your findings.

[Clark Hobbs]

Originally Posted by Tourian

Big chains like Wal-Mart and McD's have the ability to not be affected by just one market. A Big Mac costs the same in Podunk Lower Alabama as it does in Los Angeles.

Prices may vary in Hawaii and Alaska.

Lol. Have you ever traveled outside of Huntsville. The same McD's meal I get in Madison for $5 cost me $9 in LAX. They didn't even butter it before they gave it to me.

[NoleFanHSV]

Originally Posted by Clark Hobbs

Lol. Have you ever traveled outside of Huntsville. The same McD's meal I get in Madison for $5 cost me $9 in LAX. They didn't even butter it before they gave it to me.

A little old but and from 2010....


I'm Sick of Airport Food Price Gouging - Bon Appétit

"A Quarter Pounder value meal at a McDonald’s in Los Angeles costs $5.69. A Quarter Pounder value meal at McDonald’s in Los Angeles International Airport costs $7.19."


Apart of what you saw at the airport is just good old price gouging by the airports.

[Tourian]

So I guess when McD's nationally advertises their dollar value meal, you guys will happily pay more for it, cuz, u kno they didn't say how many dollars.. Or, do I have to convert my Alabama dollars for California dollars when I reach the state line? Right.

No, we're not talking about small change. We're talking differences of several dollars brought on by a big bump in minimum wage in one area of the country versus another. And I'm not talking about buying food while being held hostage in a theme park, movie theater or behind the TSA line at an airport.