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Not necessarily. At a fast food restaurant a typical worker processes hundreds of dollars worth of sales for $7.25 an hour. Do you really think raising that wage to $9.00 per hour is going to drastically raise prices?
Moreover, there is the macro-economic effect. When wages are raised, those who got the raise can spend more and thus increase sales in the economy, thereby increasing economic activity which can offset the need to raise prices.
In the food service jobs I have had (burgers, pizza), the corporate bean counters had all the numbers worked out. Labor costs usually represented about 25 percent of sales volume (not sure if management salaries are included in that 25 percent).
Based on that, plus expected efficiencies from paying higher wages (e.g. lower turnover, higher productivity), I would expect prices to increase up to 5 percent under a $9.00 minimum wage, perhaps less if management salaries are included in the 25 percent above).
Husband should have a term life insurance policy of about 10 times his annual pay. So when he dies, she gets a 750,000 payout, which should allow her to instantly pay off the house and cars and anything else they owed money on (let's say 350K total), and then continue to raise and pay for the children over the next 6 years (with some of the remaning 400K) while she figgures out how she's going to earn an income to support herself.
20 year, term policies cost around 250 bucks a year, less than most people pay for their HOA dues. Cheap by any definition.
I'm not insurable. What should uninsurable breadwinners do?
But yes I agree that those who are insurable should have term insurance for 10 times their annual pay. My high school GF collected $1 million on her 18th birthday and she was set for life. First thing she did was buy a house on the Jersey Shore (three blocks from the water) and sick away the other $900K. When I looked a few years ago, her house was worth $1.5M.
Employers hire workers when they need them. Raising minimum wage will not prevent CVS from hiring workers that they need to keep customers coming back (And, yeah, "just enough" is the standard.). Conversely, CVS won't hire or keep more workers than they need, as if they're running some charity, if we all agree to keep minimum wage stagnant while everyday costs rise. And, as far as raising prices is concerned, the trend toward razor-thin profit margins has, and continues to, be the trend in retail, so this isn't nearly as great a concern as many posters have made it out to be.
Poor people should be able to have milk in the refrigerator too. Just because my college-educated butt makes multiple times minimum wage does NOT mean that I work harder than the cashier at Dunkin' Donuts. In fact, I know that I do not. Just because I have the ability to command a higher salary than many of my fellow Americans, does not mean that somehow they aren't entitled to living within some sort of American standard. (And, yes, I consider not sending their children to bed hungry despite working hard all week as falling within that standard.)
Most are not higher than federal, only 19 are higher.
Earlier this week I read one source which claimed that 23 states have a higher minimum wage. But I think population is a better measure of the extent of coverage, and I believe most Americans live in states with a higher minimum wage.
If you have 4 people running a McDonalds on a Wednesday night, one making $7.85, one making $8.60, one making $9.50, and another making $10.00, each working a 6 hour shift, increasing the bottom 2 to $9/hour is going to cost you a whopping $9.30 extra plus taxes. As a percentage of say, $2,500 in sales, that's not much.
as a percentage of profits, which is the realistic way to view this, that is SEVERAL percent of profits for that night.
Until the franchissee's finance team tells mgmt how many heads to cut overall to offset it.
Think they won't, and you have proven stupidity. Last time when it went to $7.25, Hardees and several others franchissees started using remote drive through people taking orders. That way, a call center, whether on or off shore, could have 50 people, instead of 100 locations having one each. Cut 100 jobs, share the costs, each facility gets hit for 1/2 an employee, where they had one per before. They simply had cameras showing food prep people the car and face of the customer, so they could match it up, w/o the customer ever knowing the first voice he/she heard was 1,000 miles away..or 5,000.
Over 90% of American economists oppose minimum wage. It's ESP. Detrimental when it outstrips inflation. What happens if there is deflation like in the 1930s? Black unemployment has gone up and stayed relatively high since 1930 when the first federal minimum wage came into law.
Actually, it's usually more like slightly less than half oppose minimum wage.
For example, this survey:
Table 2: Klein & Stern’s 2003 survey of AEA members
Minimum wage laws :
1. Support strongly 28.4%
2. Support mildly 18.9
3. Have mixed feelings 14.4
4. Oppose mildly 17.8
5. Oppose strongly 20.5
Have no opinion 0.4
But couldn’t job losses of 1 to 2 percent be worth it, if the remaining 98 to 99 percent get a wage increase? This isn’t the trade-off, for two reasons. First and most important, the majority of youths are already earning more than the higher minimum that is typically proposed. For instance, in a study of a proposed minimum-wage increase in California to $7.75 from $6.75( back in 2005) economist David A. Macpherson of Florida State University and Craig Garthwaite of the employer-funded Employment Policies Institute found that, of 1.48 million California youths with jobs, 79 percent earned a wage higher than $7.75, and there’s no guarantee that these workers would get an increase. Some, but probably not most, would get what are called “spillover benefits” because of the new pressure on the wage structure. That is, they would get higher wages than before due to employers’ desire to maintain a differential between the wages of the lowest-paid and the wages of those further up in the wage structure.
Second, because the minimum wage does not make employees automatically more productive, employers who must pay higher wages will look for other ways to compensate: by cutting nonwage benefits, by working the labor force harder, or by cutting training. Interestingly, the Economic Policy Institute (EPI), a union-funded organization in Washington that pushes for higher minimum wages, implicitly admits the last two. On its website EPI states, “employers may be able to absorb some of the costs of a wage increase through higher productivity, lower recruiting and training costs, decreased absenteeism, and increased worker morale.” How would an employer get higher productivity and decreased absenteeism? By working employees harder and firing those who miss work. How would an employer lower training costs? By training less.
Nor is raising the minimum wage a good way to reduce poverty. The usual stereotype is a minimum-wage parent with no other family members working. But that’s an extremely small segment of minimum-wage workers.
signed
David R. Henderson ,professor of economics at the Naval Postgraduate School in Monterey, California. and editor of The Concise Encyclopedia of Economics (Warner Books, 2007), a book that communicates to a general audience what and how economists think. Henderson also writes frequently for the Wall Street Journal and Fortune and, from 1997 to 2000, was a monthly columnist with Red Herring, an information technology magazine
Let's say half the people earning minimum wage need to live on it and half do not. Let's say a hypothetical increase of X in the minimum wage causes MW employment to decrease by 5 percent.
The job losers (if any) are likely to be the younger, less experienced workers who do not need to live on that wage. (And historically high turnover in MW jobs may entirely mitigate actual job losses through attrition.)
The people who need to live on MW come out ahead, and any losers will generally be those who do not need to live on that wage.
And exactly what 'nonwage benefits' do minimum wage workers enjoy now? I have NEVER had an employer-provided benefit, so this term is meaningless in my experience, rendering the claim nonsensical.
as a percentage of profits, which is the realistic way to view this, that is SEVERAL percent of profits for that night.
Until the franchissee's finance team tells mgmt how many heads to cut overall to offset it.
Think they won't, and you have proven stupidity. Last time when it went to $7.25, Hardees and several others franchissees started using remote drive through people taking orders. That way, a call center, whether on or off shore, could have 50 people, instead of 100 locations having one each. Cut 100 jobs, share the costs, each facility gets hit for 1/2 an employee, where they had one per before. They simply had cameras showing food prep people the car and face of the customer, so they could match it up, w/o the customer ever knowing the first voice he/she heard was 1,000 miles away..or 5,000.
These companies are always trying to cut costs, it's not as if a minimum wage increase is going to wake them from their slumber and cause them to spring into action to try to increase efficiency, they're already doing that. If they can save some money by going to the system that you mentioned, they're going to do it, whether minimum wage increases or not.
The increase in the price of beef from the drought is costing them much more than $10 a shift. Where are the mass layoffs from that?
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