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Whenever labor costs go up, the cost of goods goes up.
Quote:
Originally Posted by Driller1
I just do not understand how anyone would question that statement.
It is very true.
It's not limited to just Labor Costs. It's all Costs.
Regulatory & Compliance Costs exist as part of Labor Costs, and also separate and apart from Labor Costs.
Cost-push Inflation is Regulatory & Compliance Costs levied by governments at various levels, which drive up the prices of goods and services.
At the risk of my comment being twisted and distorted, the ACA could be pushing wages higher in certain selected Skill-sets in some areas/regions of the US.
Why?
Cost-Accounting.
When I increase an employee's wages, I'm stuck with FICA and HI payroll taxes, but if there are no additional costs for SUTA, FUTA, worker's compensation, general liability insurance, casualty insurance etc etc etc, then it maybe cheaper for me to raise the employee's wage to dump more of the cost of the ACA onto the employee.
Again, that would have to be assessed on a case-by-case basis.
Costing...
If so few make minimum wage why the objection to raising it? The answer is-you're misleading people. Yes very few people make EXACTLY the minimum wage, but TONS of people make slightly more. $.10 above minimum wage is not suddenly living life.
I can't tell if you're ignorant, or intentionally trying to mislead people.
Raising the minimum wage would affect 24.8 million people according to the CBO. Thats basically 1 out of every 5 people employed.
Actually it will affect everyone. Even granted your CBO data is true it will affect more people negatively than positively.
What the Pew Research showed is that wages have gone up for low income Americans, just like it has for the rest of us, without raising the minimum wage.
Given the age of the typical minimum wage worker the increased demand from their higher wages will probably help those companies that sell video games and edible panties, not much help for any other companies.
Let's face it. If you are 30 years old and making within a dollar or two of minimum wage you need to take a hard look in the mirror and ask yourself "Why am I a dumbass?" You need to then ask not what the country can do for you but what you can do for yourself.
So what we have is a policy that will harm senior citizens and others on fixed incomes and the majority of American workers to subsidize the income of teenagers and morons. Some of these teenagers and morons will no longer have a job.
It is absurdly stupid to transfer wealth from jobs that require higher level skills to those that do not. It undermines educating individuals.
If wages or salary correlated to value produced, then why don't schools get more money to pay teachers who effectively save parents collectively millions of dollars in tuition fees by helping them get full scholarships to Ivy League colleges.
If a hamburger flipper effectively prevents 30 people from dying from ecoli by insuring that meat is prepared safely, is that worth more than minimum wage to a corporation, or perhaps corporate profits should rest on how well a guy making $7.50 can cook a hamburger.
1) Since 1979 the minimum wage has not kept up with inflation. But guess what? Those making minimum wage or less has declined from 13.4% of the workforce to 4.3% of the workforce. This is what you would expect. Wages have kept up with inflation for the majority of workers without any interference from government.
I would dispute that.
Quote:
A human being should be able to change a diaper, plan an invasion, butcher a hog, conn a ship, design a building, write a sonnet, balance accounts, build a wall, set a bone, comfort the dying, take orders, give orders, cooperate, act alone, solve equations, analyze a new problem, pitch manure, program a computer, cook a tasty meal, fight efficiently, die gallantly. Specialization is for insects.
-Robert A. Heinlein
The World today is not the same as it was in 1979. You now have over 800+ Skill-sets. At one time, the only Skill-sets were:
Warlord
Warrior
Witch Doctor
Priest/Priestess
Prostitute
Farmer
You've come quite a way.
The Law of Supply & Demand determines wages.
When you are seeking a job, you are not competing against all 10 Million Americans plus the 5 Million illegals.
You are only competing against those persons who have your Skill-set.
How many illegals are qualified to review and comment on bi-lateral agreements written in the Romanian Language?
ZERO. 10 years ago in college, I used to work as a dish-washer, so yeah, illegals might be competing against me there.
Suppose 500,000 Americans have your Skill-set. Even then, you're only competing against those persons with your Skill-set who have access to your Labor Market.
What grants access to your Labor Market? I don't know...you tell me......bus? car? internet connection?
How do you access your employer?
And it isn't a specific wage, like $17.430465/hour, rather its a wage bracket. Where you fall in that wage bracket dependent upon things like wisdom, leadership ability/potential, experience, loyalty, good-will, longevity, maturity, education and training. Granted those are somewhat subjective, but if your employer values them, you will be rewarded.
My point is that over time, as the number of Skill-sets increase, the Labor Pool shrinks...the Supply of Labor with Skill-set "X" decreases.
In spite of the pedantic musings by Liberals, the US is not Iceland.
The US is geographically huge in size compared to those miniature Nordic Kingdoms everyone fawns over.
An employer demands Labor with Skill-set "X", but the Labor is scattered all over the US and not everyone has access.
How do you bring the Labor to the employer? Or take the job to the Laborer?
Yes, geography impacts wages.
Quote:
Originally Posted by Volobjectitarian
Thanks for the info Mircea, but the Law of Supply & Demand vindicated minimum wage opposition at the outset.
When margins are good, competition for wages can result in reduction in margins and no increase in prices.
But, margins are NOT good, and for most businesses in this economy, margins cannot slip farther or the business falls into high risk of failure.
Bingo. A local restaurant has increased produce prices, increased energy prices, and the state increased minimum wage. They are afraid to raise prices even a smidgen and lose customers. But if they don't, they won't make rent, let alone have any $ left over for themselves.
An earlier poster said whoopie about having to raise prices 0.3% to offset increased labor costs. Do you own your own business? Most businesses are not looking to shrink their profit margins which an increase in minimum wage automatically accomplishes.
To those forum members knowledgeable in Economics who correctly predicted this would happen.....hats off to you.
You've been vindicated by real data.
And it didn't take long either.
It is my hope all of you continue to share the accurate knowledge of Economics that you have, in order to educate those who are uninformed and correct those who mislead others through misinformation or disinformation.
It's really important people have the best understanding possible, so that they do not make bad decisions that harm themselves or others financially or economically.
For every action in Economics, there is a reaction, and it doesn't always feel good or tickle.
For those of you who BOLO'd big time....you might want to try to learn something from those who know.
Vindicating...
Mircea
I'm just exhausted by the whole debate that's why I said the GOP should just let the Dems raise it. Opposing the minimum wage is like opposing pre-K, you maybe right but you'll lose politically. It's very difficult explaining things to people who struggled to graduate from high school or are sociology majors.
An earlier poster said whoopie about having to raise prices 0.3% to offset increased labor costs. Do you own your own business? Most businesses are not looking to shrink their profit margins which an increase in minimum wage automatically accomplishes.
Only a liar or moron would even propose a .3% increase as the result.
Let's get real. From the University of Massachusetts:
I think we can use their 2.7% figure as the bottom of the range. As I learned in Business 101 a nickel out of every dollar separates a successful company from an unsuccessful one.
And, the microest micro manager is the individual.
Last edited by Hyperthetic; 11-18-2014 at 11:58 AM..
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