Is California doing so well that they can provide $15/hr minimum wage? (2014, wages)

[BodegaHead]

Nah, this place is f*cked. $15 an hour in California is equivalent to like $2-10 an hour anywhere else in the US except Hawaii and NYC. I call the $100 bill a Frisco $10 and the dollar a Frisco penny.

$15 an hour is a better wage for low skilled workers but they will still be POBARd(Priced Out Beyond All Reconotion). It will probably end up jacking prices on other things up too screwing those of us in the middle incomes even more than we already are.

[CA4Now]

"The argument given against paying a living wage in fast-food restaurants is that workers are paid according to their skills, and if the teenager cleaning the grease trap wants more money, he should get an education. Like most conservative arguments, it makes sense logically, but has little connection to economic reality. Workers are not simply paid according to their skills, they’re paid according to what they can negotiate with their employers. And in an era when only 6 percent of private-sector workers belong to a union, and when going on strike is almost certain to result in losing your job, low-skill workers have no negotiating power whatsoever."

The “middle class” myth: Here’s why wages are really so low today - Salon.com

[EclecticEars]

"Is California doing so well that they can provide $15/hr minimum wage?"

Honestly, no.

Maybe, maybe the Bay Area, Orange County, and West L.A., with their currently low unemployment rates, can most effectively provide this. But, otherwise, $15/hour will crucify small businesses in places like the Central Valley, Imperial Valley, North Coast, and Inland Empire, and even in less wealthy areas in Los Angeles County and the Central Coast.

Terrible, terrible idea.

[2sleepy]

Why not look at the real evidence of the impact of raising the minimum wage?

1950, when the minimum wage went from 40 cents an hour to 75 cents an hour, an increase of 87.5 percent. The entire raise took effect on Jan. 25, 1950, just 90 days after the passage of the law that authorized it. What happened then? Data sources from that era do not allow for the kinds of analyses that economists have used to evaluate the impact of more recent minimum wage increases. But this much is known: In December 1949, the month before the raise kicked in, the national unemployment rate was 6.6 percent. By December 1950, when the 75-cent minimum had been in place for nearly a year, it had fallen to 4.3 percent. By December 1951, it was 3.1 percent and by December 1952, it was 2.7 percent.

Study: Raising wages to $15 an hour for limited-service restaurant employees would raise prices 4.3 percent

If average inflation meets the Federal Reserve’s target rate of 2 percent per year between now and 2020, the Murray-Scott bill’s $12 per hour minimum wage (federal) would be equivalent to about $10.87 in today’s dollars. When fully implemented, the increase in workers’ income from a minimum wage of this value would cause SNAP spending to fall by an estimated $5.3 billion each year in today’s dollars, saving taxpayers more than 7 percent in overall SNAP expenditures.

[Marv101]

It's a very stupid rule from a party with a multi-decade history of producing them and which always turn out to be devastating for the middle class.

[mysticaltyger]

Originally Posted by d_vader123

Apparently there are clauses in this bill that could drop it down if the economy gets hurt by this, but still. Is your economy doing this well?

No, it isn't.

Originally Posted by d_vader123

What do you Californians think about this?

Unfortunately, we've let our emotions overrule our brains. We also want quick fixes that feel good and require little effort, or require someone else besides ourselves to put forth effort.

As this article on the subject stated:

[favoring a $15 minimum wgae] simply reflect[s] the human tendency to be impressed by evidence that confirms our beliefs and reject[s] information that challenges them. "We see what we want to see," economist and author Tim Harford wrote in a recent column.

The $15 Minimum Wage Will Kill Jobs. Should You Care? - Bloomberg

[mysticaltyger]

Originally Posted by froglipz

Well with median price of an existing, single-family detached California home of $446,460.

Raising the minimum wage won't fix this problem. The only thing that will is increasing the supply of housing. People at the bottom of the wage scale (whatever that wage is) will always be priced out if housing is scarce.

Why Middle-Class Americans Can't Afford to Live in Liberal Cities - The Atlantic

Liberals might say that the developer acting in his own self-interest ignores certain externalities, and they'll apply restrictions. But these restrictions [e.g. historic preservation, environmental preservation, and height ceilings] add up, across a city, even if they’re well-intentioned. The affordability issue will rear its head."

Fixing California: The Green Gentry


Particularly damaging are steps to impose mandates for renewable energy that have made electricity prices in California among the highest in the nation and others that make building the single-family housing preferred by most Californians either impossible or, anywhere remotely close to the coast, absurdly expensive.

The gentry, of course, care little about artificially inflated housing prices in large part because they already own theirs — often the very large type they wish to curtail. But the story is less sanguine for minorities and the poor, who now must compete for space with middle-class families traditionally able to buy homes. Renters are particularly hard hit; according to one recent study, 39 percent of working households in the Los Angeles metropolitan area spend more than half their income on housing, as do 35 percent in the San Francisco metro area — well above the national rate of 24 percent.

[Tulemutt]

Originally Posted by mysticaltyger

No, it isn't.



Unfortunately, we've let our emotions overrule our brains. We also want quick fixes that feel good and require little effort, or require someone else besides ourselves to put forth effort.

As this article on the subject stated:

[favoring a $15 minimum wgae] simply reflect[s] the human tendency to be impressed by evidence that confirms our beliefs and reject[s] information that challenges them. "We see what we want to see," economist and author Tim Harford wrote in a recent column.

The $15 Minimum Wage Will Kill Jobs. Should You Care? - Bloomberg

Apparently you haven't been reading these multiple threads on the topic very thoroughly. Try following this progression of posts from another of the related threads:

Originally Posted by Elliott_CA
McDonalds

Sales: $25.4 billion per year
Cash on hand: $7.7 billion
Profit margin: 17.8%
Key executives' salaries range from $1.91 mil to $767 K per year
Adding 1,000 new stores in China
Employees: 420,000

Even if you give all 420,000 employees an extra $5/hr right now, the profit margin only drops from 17.8% to 14%. Clearly, they can afford to pay $15/hr.

Sorry, this doesn't tell the whole story.


420,000 is indeed the number of employees attributed to the McDonalds Corporation for 2015. This includes employees that work in McDonalds stores THAT ARE OWNED BY THAT PARENT CORPORATION.


According to a 2012 report from the BBC, McDonalds is the #2 employer in the world (Wal-Mart is #1) with 1.9 Million employees, OF WHICH 1.5 MILLION WORK FOR THE FRANCHISEES.


THE FRANCHISEES certainly don't have the cash on hand that the parent corporation does.


Profit margin?....might be publicly available for large franchisees where those franchises are part of a larger publicly held holding company....However, re 'mom and pop' franchisees........ask the IRS.

Quick Answer.
An average McDonald's franchise makes between $500,000 and $1 million in profits per year as of 2013, according to McDonald's Franchise Disclosure Document. For restaurants open at least 1 year in the United States, average total revenues are $2.6 million.

Not to mention, the average Mc Donald's franchisee owns 5 stores

I'd say your Bloomberg article needs to go back to the editor's desk for re-tooling.

[mysticaltyger]

Originally Posted by Tulemutt

Apparently you haven't been reading these multiple threads on the topic very thoroughly. Try following this progression of posts from another of the related threads:


I'd say your Bloomberg article needs to go back to the editor's desk for re-tooling.

Oh yes, I've read them ad infinitum. We will never agree. No surprise there.

[Tulemutt]

Originally Posted by mysticaltyger

Oh yes, I've read them ad infinitum. We will never agree. No surprise there.

There really is no disputing the hard factual data I and Elliot and sleepy have supplied, tyger. The minimum-wage fast food industry continues to employ and yet profit at much higher wages in markets elsewhere. The profits are very substantial, leaving plenty of room for the increases.