A struggle for good paying jobs? (Pittsburgh, Harrisburg: insurance, student loans, transfer)

[gladhands]

Originally Posted by tyovan4

Do you really not understand how this is going to work? It's Econ 101.
Labor costs are going to rise if the minimum wage is effectively doubled. Do you think that companies are just going to eat that cost increase from their bottom line, out of the goodness of their hearts? If so, please pass whatever you're smoking.

Costs rise. Companies want to maintain their profits. So, they raise prices to compensate for their additional labor costs that have been tacked on by pie-in-the-sky leftists. Price increases get passed on to consumers. So now, when I want to purchase the same goods or services that I wanted before the minimum wage increase, they end up costing me more as the companies passed their increased labor costs on to me in the form of increased prices. So its money out of my pocket, thus limiting my disposable income.

So yes, increased minimum wage will penalize working class people as it will have a detrimental effect on our disposable income - and such effects will be felt far more harshly by people such as myself rather than people such as you.

Actual economists, the kind who've taken more than Econ 101 have crunched the numbers and determined that McDonalds could increase it's minimum wage to $15/hr and maintain current profit margins with price increases somewhere between 6 and 20 percent. Worst case, $5 meal would cost $6, but the working poor would have TWICE as much money to pump back into the economy.

[SteelCityRising]

Originally Posted by eschaton

Third, the movement is probably necessary to combat the current economic stagnation of our economy. In the "recovery" from the Great Recession real wages have been flat, despite the unemployment rate continuing to edge down. If real wages for Americans do not rise, people do not have more money to spend, and since consumer spending tends to be one of the major driving forces of the U.S. economy, less jobs are in turn created. The vast majority of the wealth generated recovery have gone to the upper-middle and upper classes only. Even setting aside questions of injustice, this is bad from a standpoint of economic stimulus, because working people spend virtually all of the money they earn, while wealthy people only spend a portion of each dollar, saving quite a bit as well. And indeed, what we have seen is that investments have done well over the last six years, but consumer spending and job growth not so much.

Exactly why I'm voting for Bernie Sanders. We need an economic revolution in this country. It's shameful that we've been out of the Great Recession for numerous years now, yet the vast majority of the working-class has seen FLAT real wage growth while the virtually all of the economic gains have been going to the upper class. I've had one raise in 4.5 years that's been devoured by inflation during that time. It's easy to say "get another job", but what about my successor who gets stuck with flat wage growth, too?

[eschaton]

One more example for the peanut gallery:

Back in the 1970s, grocery store clerks made as much as autoworkers - solid middle class wages with a full benefit package. The clerks union (which was ****, and is still **** as the UFCW) decided to roll over and partner with management on two-tier hiring structures in the 1980s, where new hires came in as part-time workers with no benefits. The jobs by the 1990s became staffed mostly by high school students making minimum wage.

Labor costs were cut dramatically for grocery stores in the process. But groceries remain a high-volume, low-margin business - one which eked out small profits before, and still eke out small profits. Basically, it worked under both the old, high-wage model and the new, low-wage model.

Now, it may be true that the price of groceries dropped over this period. But if this is the case, it didn't make a determinate difference in real wages of working people. Annual wage growth for the bottom 60% of the U.S. was better from 1950-1979 than it was from 1980 to the present.

I think the example of how grocery stores used to work - how they managed to make profits, and consumers weren't sent to the poorhouse shopping - shows that the economy could adjust to higher-paid fast food workers without the average person seeing a real loss to their standard of living.

[PghYinzer]

People want cheap hamburgers, and the only way to do that is to keep labor costs down. The "food" itself cannot get any cheaper and corporations are not even going to consider the idea of making less money. Profits above people is the American way. We either move away from a disposable, cheap product (aka low wage labor) society, or accept that there will always be people who can barely get by, just so those who are a little more fortunate can have a $1 "hamburger."

[BigPizzaHutFan]

Pro ad.

[Lobick]

Originally Posted by PghYinzer

People want cheap hamburgers, and the only way to do that is to keep labor costs down. The "food" itself cannot get any cheaper and corporations are not even going to consider the idea of making less money. Profits above people is the American way. We either move away from a disposable, cheap product (aka low wage labor) society, or accept that there will always be people who can barely get by, just so those who are a little more fortunate can have a $1 "hamburger."

What does that even mean? All corporations are going to shut their doors if they can't maintain their current profit margins? Somebody else won't fill that void even if there's a profit to be made?

[tyovan4]

Originally Posted by gladhands

Actual economists, the kind who've taken more than Econ 101 have crunched the numbers and determined that McDonalds could increase it's minimum wage to $15/hr and maintain current profit margins with price increases somewhere between 6 and 20 percent. Worst case, $5 meal would cost $6, but the working poor would have TWICE as much money to pump back into the economy.

"What is more, a minimum wage is not free. Someone must pay. The common refrain that companies will shoulder the burden is the product of hope rather than evidence. If the cost is passed on to consumers, the minimum wage turns into a subsidy funded by a sales tax—a revenue-raiser that, again, falls heavily on the poor."
A reckless wager | The Economist

[BigPizzaHutFan]

Originally Posted by tyovan4

"What is more, a minimum wage is not free. Someone must pay. The common refrain that companies will shoulder the burden is the product of hope rather than evidence. If the cost is passed on to consumers, the minimum wage turns into a subsidy funded by a sales tax—a revenue-raiser that, again, falls heavily on the poor."
A reckless wager | The Economist

At this level of abstraction you can argue that excessive CEO incomes are placing a burden on the poor by making prices higher, too. It's just easier to pick on the poor and defenseless.


You didn't answer my question. Why should hard-working fast food workers suffer because you are incapable of working your way up?

[eschaton]

Originally Posted by PghYinzer

People want cheap hamburgers, and the only way to do that is to keep labor costs down. The "food" itself cannot get any cheaper and corporations are not even going to consider the idea of making less money. Profits above people is the American way. We either move away from a disposable, cheap product (aka low wage labor) society, or accept that there will always be people who can barely get by, just so those who are a little more fortunate can have a $1 "hamburger."

Hamburgers could be even cheaper if they were made by unpaid forced labor - slaves. We don't do that because we have decided that human rights - and the dignity of human labor - are to some extent more important values than consumers always getting the lowest price possible, and corporations always making the most money possible.

The line has already been drawn. Profits and low prices aren't the only concern in our nation. The question is more do we shift the line than anything. Considering fast-food workers do make living wages in other developed countries (where admittedly fast food is more expensive - I think big Macs cost $11 USD in Norway). Still, their national economies survive just fine.

[PghYinzer]

Originally Posted by Lobick

What does that even mean? All corporations are going to shut their doors if they can't maintain their current profit margins? Somebody else won't fill that void even if there's a profit to be made?

What I am saying is if company X raises wages, but not the price of their product, they will take a profit hit. That is clearly not what they want. So if forced to raise wages, they will raise the price of their product to compensate that and maintain profits. The majority of consumers want and buy cheap products, so they in turn support low wages because these companies are not going to decide to be kind hearted and make less profits in order to pay their employees more and keep prices the same.