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Not all employees work in a 'profit center' (e.g. manufacturing, sales) where their contributon can be easily quantified. Customer service (e.g. tech support that's not sales) doesn't produce direct revenue; what are those employees worth?
Every job can be quantified. From surveys to monitoring calls to supervisor input are just a few of the ways to tell how someone is doing a good job.
I work in a field that has no direct monetary value that can be calculated. That's why my boss's input is so important. He sees the tasks I am given and accomplish, and takes that into consideration when it comes time for a review.
Apparently, I'm worth quite a bit, even though I don't contribute directly to the profit. I'm getting another raise at the end of the month. I've made sure that my "worth" is something my company finds valuable. I take on ANY task my boss throws at me, and always make sure that I do the job in a timely and accurate manner. It's not always easy, like yesterday when I had to troubleshoot our shopping cart (I had zero web experience when I started at this company, but told my boss I was willing to try and figure it out. And I have.) I wasn't born knowing how to write code and design a website, but I've managed to figure it out. Being motivated, hard working and a little competitive helps.
Depends on the type of unskilled labor (is it physically demanding, exposed to temperature extremes, etc.).
Quote:
Originally Posted by SOON2BNSURPRISE
Untried unskilled laborers? It is ZERO. People are worth what they can provide the company with.
Quote:
Originally Posted by Foques
It depends on the value the said unskilled labor yields.
As a general, blanket statement, minimum wage is enough.
So basically, all of you believe that unskilled labor (secondary sector/simple control market) is not a true market set by supply and demand, but a oligopsony where employer willingness to buy alone drives pricing.
Which is exactly the argument made for why the minimum wage must be increased regularly with inflation! In a oligopsony, there is an incentive and capability for the employers to manipulate the market and access to information to force workers to accept a below market wage, essentially putting the power to push the floor of supply down, causing labor market deadweight that is captured by the employer.
no.
your work yields basic value, you should be getting a basic compensation. Current compensation is just fine. If you want to make more, make yourself more useful.
How was my mother/father supposed to support me? We all came here -only 3 of us. my routine was HS-PT job 1 - PT job 2 - PT job 3 - I would shower and sleep in School.
If you did not personally make enough money to eat or pay rent, or even had enough time to prepare food to eat. What did you do? Starve and go homeless? Or did your parents or siblings contribute to the cost of food and rent and help prepare feed, clean the home, wash clothes, etc? It is telling that you do not understand the enormous asset that is having an intact family (not to mention that you think that $500 is an insignificant amount of savings).
Quote:
Originally Posted by Foques
Most of the people are just lazy to learn a skill; and I see no reason why laziness should be rewarded.
Very false. The vast majority of people earning minimum wage do not have the social or economic capabilities to learn a new skill; many do not have the intellectual capabilities either. I certainly did not while I was earning minimum wage, yet today I am one of the top skilled workers in the country in an emerging profession.
A rule of thumb that I have worked with is people should bring in 3X what they are paid as a minimum requirement. Imagine how much happier people would be if they were told that the minimum wage did not exist anymore. Imagine how much more productive workers would be if they were now paid 1/3 of what they bring into a business. Instead of people fighting to make $15 an hour they could prove to the company that they are worth the $15 an hour by producing at least $45 of value. For the main streem media following readers, value means income to the business and not sales of the product. Lets say that a BigMac meal cost $7 but has an income to the franchise of $1.00 (And I have no idea what is the profit margin for a BigMac meal) The $1.00 devided by all the people that provided that Bigmac meal. Lets say that 4 people were involved with the process, the person making the food, walking the food over to the counter, the person taking the order, and the person cleaning up. So now we are down to $0.25 To justify making $15 an hour you would need to sell 180 Big Mac meals an hour. If someone knows what the actual profit margin is then it would be fun to complete the numbers. We can adjust sales to see if it is a viable thing to pay someone $15 an hour to work at McDonalds.
McDonald's target for franchisers is for revenue to be 5x total labor costs (which means that employees are bringing in ~8X what they are paid). The minimum standard is 26% labor; above that and the franchise can be closed, which translates roughly into 4x revenue to total labor cost and each employee bringing in approximately 6.4x what they are paid. (And even this is number is an underestimate when you consider individual crew members, because their pay is so much smaller than that of the store and assistant managers.)
But this gets tricky with your standard. Margin for franchisers is barely 5%. So while you might be spending on $20 on that $100 in revenue, the income is also only $5. Why? Because ~40% of the revenue straight goes back to the McDonald's corporation in franchise fees, advertising, and royalties. And that is on top of the 5-10% premium you have to pay for corporate approved supply chains. And then you have to pay rent to the regional franchiser (McDonald's version of MLM - you have to rent your store from a higher level franchiser who actually owns it).
So, it depends greatly on where we place "income to the business". If we set it purely at the franchiser, then clearly crew members are not worth what they cost. If we include income that flows to the corporation and regional franchisers though, then the crew members are already well under that 3X standard. All of this is also why corporate stores, in particular, are being targeted by this campaign. The corporate stores have margins near 60% instead of the 5% of franchisers and could much more easily absorb an increase in wages.
Customer service does create revenue. Ever hear of Nordstrom? It is only a 13 billion dollar company who has a stock at all time highs. If people wanted cheap clothing with no customer service then what is driving it up
no.
your work yields basic value, you should be getting a basic compensation. Current compensation is just fine. If you want to make more, make yourself more useful.
But see, the value proposition means that the value of your work is set by its productivity.
That's not how capitalism works. The value of your work is set by the market for supply and demand. If the employer cannot pay enough to derive a profit at the market clearing value for labor, then they don't get to stay in business. But in an oligosony, instead the employers have an ability to set the market wage through market control (normally through information control and collusion, both of which we have here) and great market dead weight where the cost of labor is below the market clearing value. This both keeps competitors out of the market and maintains excess unemployment in their labor pool. This results in a deadweight loss that is partially captured by the employer. If the market could go to market clearing value, unproductive uses of labor would go out of business and be replaced by more productive competitors who can pay better wages. Employees capture more of the market and earn higher pay. Employers capture less of the market and get less return on their capital. But the market is more productive.
That is why value proposition does not work, and also why there is a definitive value of unskilled labor regardless of how that labor is used.
Not all employees work in a 'profit center' (e.g. manufacturing, sales) where their contributon can be easily quantified. Customer service (e.g. tech support that's not sales) doesn't produce direct revenue; what are those employees worth?
Depending on the standard set and that standard does not have to be sales, it is very easy to determine who is performing and who is not performing.
McDonald's target for franchisers is for revenue to be 5x total labor costs (which means that employees are bringing in ~8X what they are paid). The minimum standard is 26% labor; above that and the franchise can be closed, which translates roughly into 4x revenue to total labor cost and each employee bringing in approximately 6.4x what they are paid. (And even this is number is an underestimate when you consider individual crew members, because their pay is so much smaller than that of the store and assistant managers.)
But this gets tricky with your standard. Margin for franchisers is barely 5%. So while you might be spending on $20 on that $100 in revenue, the income is also only $5. Why? Because ~40% of the revenue straight goes back to the McDonald's corporation in franchise fees, advertising, and royalties. And that is on top of the 5-10% premium you have to pay for corporate approved supply chains. And then you have to pay rent to the regional franchiser (McDonald's version of MLM - you have to rent your store from a higher level franchiser who actually owns it).
So, it depends greatly on where we place "income to the business". If we set it purely at the franchiser, then clearly crew members are not worth what they cost. If we include income that flows to the corporation and regional franchisers though, then the crew members are already well under that 3X standard. All of this is also why corporate stores, in particular, are being targeted by this campaign. The corporate stores have margins near 60% instead of the 5% of franchisers and could much more easily absorb an increase in wages.
Thank you for explaining this. I really had no idea how the company works nor did I have the time to look it up.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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Quote:
Originally Posted by ringwise
Every job can be quantified. From surveys to monitoring calls to supervisor input are just a few of the ways to tell how someone is doing a good job.
I work in a field that has no direct monetary value that can be calculated. That's why my boss's input is so important. He sees the tasks I am given and accomplish, and takes that into consideration when it comes time for a review.
Apparently, I'm worth quite a bit, even though I don't contribute directly to the profit. I'm getting another raise at the end of the month. I've made sure that my "worth" is something my company finds valuable. I take on ANY task my boss throws at me, and always make sure that I do the job in a timely and accurate manner. It's not always easy, like yesterday when I had to troubleshoot our shopping cart (I had zero web experience when I started at this company, but told my boss I was willing to try and figure it out. And I have.) I wasn't born knowing how to write code and design a website, but I've managed to figure it out. Being motivated, hard working and a little competitive helps.
One of the last projects I did as a management analyst in a previous career was to implement an automated call management system for the customer service people in a call center for on and off orders, billing questions etc. The sophisticated software (even better now) gives management a variety of performance reports that can be used for annual reviews, raises, discipline and staffing level management.
There is definitely a monetary value that can be placed on an employee based on the number of calls and speed of handling compared to the average.
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