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In a related development...1,300 formerly employed restaurant workers in Seattle could not be reached at work for comment...because they no longer had jobs once the local minimum wage increased to $11.00/hour in April, 2015, thereby rendering their services too expensive relative to the value of the labor they were providing.
However, one former Seattle restaurant worker, who identified himself as Boris Boogerpicker, when asked what he thought about losing his job after the Seattle minimum wage increased to $11.00 per hour, responded, "It came out of left field all of a sudden. Nobody coulda seen it coming. We thought we wuz gettin' a raise, but we all got pink slips instead. You'd think these guys were runnin' a business or something. But yeah...all in all, I'd rather have one job at $8.50 an hour than no job at $11.00 per hour. Now I got nothin'. Just sayin'."
First, I'll note that the American Enterprise Institute is a right-wing organization.
Second, using their own presentation of the data, Seattle gained more than 25,000 restaurant jobs since 2010 prior to the 1300 drop-off.
So you can look at it from the glass half empty perspective of "most jobs lost since Great Recession" hyperbole.
Or...
You could present is as, "Restaurant jobs in Seattle up 23,700 in the 4.5 years since 2010, a faster rate of increase than the 19,000 jobs added in the 5 years from 2003-2008."
Being familiar with Seattle living costs, $11 an hour would not even be enough to live with roommates.
First, I'll note that the American Enterprise Institute is a right-wing organization.
Nothing wrong with that, of course. When somebody is right, they're right.
Quote:
Originally Posted by redguard57
Second, using their own presentation of the data, Seattle has gained more than 35,000 restaurant jobs since 2010.
So you can look at it from the glass half empty perspective of "most jobs lost since Great Recession" hyperbole
Or...
You could present is as, "Restaurant jobs in Seattle up 23,600 in the 4.5 years since 2010, a faster rate of increase than the 19,000 jobs added in the 5 years from 2003-2008."
All of which ended precipitously with the mandated increase in the local minimum wage to $11.00 per hour, we would be remiss in failing to note. When you increase the cost of labor, businesses purchase less of it, as we clearly see here.
Quote:
Originally Posted by redguard57
Being familiar with Seattle living costs, $11 an hour would not even be enough to live with roommates.
And a wage of ZERO dollars per hour, which is what these 1,300 unfortunate formerly employed people now have, helps with the cost of living in Seattle how, exactly?
Nothing wrong with that, of course. When somebody is right, they're right.
All of which ended precipitously with the mandated increase in the local minimum wage to $11.00 per hour, we would be remiss in failing to note. When you increase the cost of labor, businesses purchase less of it, as we clearly see here.
And a wage of ZERO dollars per hour, which is what these 1,300 unfortunate formerly employed people now have, helps with the cost of living in Seattle how, exactly?
If a job does not pay a minimal living wage, then perhaps that job should not exist, particularly if automation or efficiency gets the job done just as well as the low-skilled person.
If a business needs a job done, it will pay that person what it costs to recruit and retain them.
Shouldn't it be indexed by inflation to avoid the political theatre and the political pricing of the next minimum wage hike instead?
The minimum wage is designed to protect workers from the erosions caused by inflation. Can anybody still live on $1.60 an hour ($10.74 in 2013 dollars) unadjusted since 1968, considering all the inflation since 1968?
KerrTown, I have always been in complete agreement upon the points of your last post and I’ve been a proponent for increasing the purchasing power of the FMW rate and thereafter retaining its purchasing power,
Respectfully, Supposn
Odd Ball, there are many factors that contribute to increasing USA prices; the federal minimum wage (FMW) rate is not among the primary factors that do so.
(1) ALL USA employees do not proportionally equally benefit from a federal minimum wage (FMW) rate, they ALL do benefit to some extent.
(2) The proportional increase of jobs’ wage rates are inversely related to the amount of the jobs’ rates; (i.e. lower rate earners benefits are greater and higher rate earners benefits are proportionally lesser.
The proportional increase of the FMW rate is ALWAYS much greater than the proportional increases of USA’s aggregate prices due to any increase of the FMW rate.
KerrTown, the federal minimum wage, (FMW) rate prevents jobs’ wage rates from “racing to the bottom”.
Its ability to reduce number of USA's poverty incidences and their extents is dependent upon the FMW rate’s purchasing power. That’s justifies pegging the rate to the cost-price index. The rate is not among the primary causes but rather it is a victim of the U.S. dollar’s reduced purchasing power.
KerrTown, the federal minimum wage, (FMW) rate prevents jobs’ wage rates from “racing to the bottom”.
Its ability to reduce number of USA's poverty incidences and their extents is dependent upon the FMW rate’s purchasing power. That’s justifies pegging the rate to the cost-price index. The rate is not among the primary causes but rather it is a victim of the U.S. dollar’s reduced purchasing power.
Respectfully, Supposn
Just curious but do you believe if the minimum wage was eliminated that wages would "race to the bottom?" Seems to me that in a reasonably healthy/competitive market for the labor, this would not be the case. Where I am located the economy is fairly healthy. Very few jobs here pay minimum wage.
Just curious but do you believe if the minimum wage was eliminated that wages would "race to the bottom?" Seems to me that in a reasonably healthy/competitive market for the labor, this would not be the case. Where I am located the economy is fairly healthy. Very few jobs here pay minimum wage.
Car Crazy67, The legal minimum rate is enforced upon all jobs regardless of the tasks being less demanding or less inconvenient or even if it’s pleasurable to perform.
Due to the legal minimum rate, there are jobs that do not exist because employers’ determined paying the minimum rate for the accomplished those task are financially unjustified.
There are many physically, mentally or socially handicapped people who are now unemployable but since they’d be willing to work for lesser hourly rates, could accomplish those lesser demanding tasks. If the minimum wage laws were eliminated employers would be financially justified to create those jobs and hire those people at extremely reduced wage rates.
In those circumstances more jobs have been created and more people have become employable, but the increase of our potential and employed labor exceeds the additional jobs that have been created; because as less demanding jobs are created, more handicapped people at lower wage rates become qualified to do those jobs.
All minimum wage bench marks, (i.e. specific legally enforced or indefinite market driven minimum rates) are applied to the least demanding jobs. An unenforced indefinite minimum promotes the creation of jobs with much lesser demanding tasks for much less than our current $7.25 legal minimum’s purchasing power. These additional jobs which previously couldn’t justify the legal minimum wage would contribute extremely little per job to our GDP.
Car Crazy67, the short answer to your question is certainly I believe if the minimum wage was eliminated, wages would "race to the bottom.
But, the income inequality remains a problem. So, I think a better route to take is to force the CEO salary to be a percentage of the lowest income in the company. That way, the CEO and the leadership will have an incentive to drive the lowest income higher without much effect on the rest of companies
Where is the money supposed to come from, to raise all those salaries. Just does not pencil out.
Lets use a simple to understand example. A fast food restaurant will have a food cost of 30% of the gross sales. 30% of gross sales is applied to wages for the crews. 40% is to cover all other business costs, payment to the parent company, rent on the building, new equipment etc., that is needed, and if there is anything left over it goes to the owners as a profit. And the profit on a single fast food restaurant is less than most people with a college degree think they should get as a salary in most cases. The reason that successful fast food restaurant owners, own 2 or more.
Raise minimum wage to $15 and that means 60% goes to wages instead of 30%. Some will say raise the prices to cover, but if they do the sales volume of the restaurant will drop to the point the restaurant may have no money for the owner and in all probability they will have to put money out of their pocket to stay open.
The alternative is to automate most of the employees out of a job. Here is the next thing to make hamburgers with only one person needed to feed the machine with ingredients.
Where is the money supposed to come from, to raise all those salaries. Just does not pencil out. ...
... Raise minimum wage to $15 and that means 60% goes to wages instead of 30%. Some will say raise the prices to cover, but if they do the sales volume of the restaurant will drop to the point the restaurant may have no money for the owner and in all probability they will have to put money out of their pocket to stay open.
The alternative is to automate most of the employees out of a job. Here is the next thing to make hamburgers with only one person needed to feed the machine with ingredients.
Today this machine will pay for itself in 1 year, from savings of not paying employees.
Double the Minimum wage, and it will pay for itself in 6 months.
Combine this with a touch screen ordering and paying system, and with a couple other robots you can almost eliminate hast food workers.
Some businesses can only afford to pay low wages
Old Trader, I am not opposed to technological advancements that reduce the labor and thus the costs of goods and service products. A nation’s utilizing human powered rickshaws because human labor is cheaper than the capital investment for trucks, buses and taxicabs is a poorer nation.
If an enterprises are able to maintain their production of goods and services and reduce their labor costs by reducing their labor force or their numbers of paid hours or their employees’ benefits, they would do so; if they could retain their revenues while reducing their products’ quality, they would do so; but competitive markets punish enterprises that fail in their attempts to employ such methods to reduce their labor costs.
Dirty toilets within a retail establishment or other similar reductions of quality and/or services more often fail rather than succeed. In practice there a very few jobs lost due to any increase of the FMW rate’s purchasing power. Jobs were not generally created due to altruistic motives; a job is retained until its cost-benefit is no longer favorable. Almost all jobs have remained to employers' advantages after each increase of the FMW rate.
Modifications to The FMW rate have and should always be gradually enacted; sudden radical changes are generally not economically amiable. The consequences of increasing the FMW rate’s purchasing power have always been to USA’s net economic benefit.
If a job does not pay a minimal living wage, then perhaps that job should not exist
Shouldn't the person needing the work done and the person offering to do the work decide that? Or are you suggesting that someone else, perhaps you, should decide?
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