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The people on this thread, are missing a few facts.
Minimum wage jobs, are not offered by large companies. They are in smaller local employers.
Lets use an example. A fast food restaurant sells hamburgers for $3. The food cost will be 30.3% or $1. Labor costs will total 33.3% or $1. $1 is left to pay for lease and franchise payments, utilities and every thing else in the way of expenses. If the owner is lucky, he will be able to have a little left for profits.
If minimum wages double, labor costs double and that is an immediate raise of $1 in his prices. Others such as his suppliers will be raising wages, so the cost of food will also increase, so he will be selling a $5 hamburger. Problem, when the price is raised that much, business declines, which means to keep having the money to pay for rent, etc., he will have to raise the price even more to compensate.
The same thing will be happening in department stores who pay at or just above minimum wages. And the list goes on and on. The businesses have two choices. Raise price to cover, or lay off part of the employees, increasing the unemployment rate.
WalMart is very close to minimum wage. A $15 hour minimum wage will give a lot of their workers a raise.
But increasing the minimum wage changes the supply/demand relationship by affecting the ratio of debt to income.
The minimum wage means that new growth in the economy happens above it. The new jobs added will pay more. Add enough new jobs and we are all better off.
i won't dispute that, but economies never go up in a straight line. wages set via law and not supply and demand create imbalances and financial weapon of mass destruction during future recessions that are guaranteed to come. just look at the pension system.
My neighbor insists that every time they raise the minimum wage here in the US the cost of living goes up too so that nothing ever improves financially for anyone and often they are worse off then before . He said he has seen it happen over and over again in his life and if they raise the minimum wage again to $15 dollars and hour all over the US the same thing will happen again things will become more expensive.
Is that true ? Does the cost of living always go up when the minimum wage increases?
One would need to know what percentage of the population is at the minimum wage in a given area. There is another factor. The price elasticity of the items being purchased. In other words will people stop buying the item if the price moves upward? I also don't think that the rise in wages will cause so much economic activity as to be inflationary.
If you live in the Villages a lot of people have been indoctrinated to think the way your neighbor does.
Depends on your definition of the phrase "very close". Walmart is paying a company minimum of $10.
Of course a raise in the minimum to $15 would be a raise for probably most of their associates even at that rate.
Wal-Mart doesn't care. They will raise everyone... they just accelerate everyone by about half a step when a MW increase happens. They call it a "market raise." They have to do that because they do have competitors they have to think about. I was working there when the last MW hike went through. Labor costs are not something WM worries about too much. They worry about unionization not because of payroll, which they can control, but because of health insurance, which they can't control.
Higher MW might actually help Wal-Mart, since turnover affects them more than most companies.
i won't dispute that, but economies never go up in a straight line. wages set via law and not supply and demand create imbalances and financial weapon of mass destruction during future recessions that are guaranteed to come. just look at the pension system.
The FED has had its finger on the supply and demand scale for a very long time. This has created an imbalance in the wage distribution. The bottom has been paying the inflation tax and the top has gotten a free ride from inflation.
There are several big imbalances. Top heavy income distribution, too much debt. The correction for to much debt normally is economic depression not recession. (Economic depression = deflation + 20%~unemployment) With the wealth distribution we have, the bottom will suffer most come deflation.
Driving inflation with the minimum wage law may well get a recession, it may be painful, but the alternative is worse.
higher minimum wage independent of true supply/demand of labor market means in the next recession, more people get fired than if it hadn't gone up.
also, privately owned companies, small businesses, are already preparing to layoff workers when the new minimum wage goes into effect. the people who keep their jobs will have increased workload, having to do more work to replace those that were fired. thanks for playing.
This has been happening for years now. So the gradual raise to $15/hr isn't really "cause and effect", but really "effect and cause". In other words, there's no bearing.
Not very job deserves a living wage. Flipping burgers does not. WHy? Because any 12 year old with half a brain could do it. Basically, zero skills are involved. Zero skills equals nearly zero dollars. The position is worth what the skills are for the position. Let's pay the pizza delivery guy $30 for the pie because the driving took him an hour.
Living wages require some sort of skill or knowledge. No way should the lazy partying dude who stays out all night drinking and gets up at noon to stack apples in the produce dept should get 1/4 of what a beginner accountant should get. This is what made our country so great. People wanted more from life than low wages so they bettered themselves and made themselves more marketable. They didn't ask mommy and daddy governemsnt to help. Government should have no input into this.
And that is precisely what companies want everyone to think. Because it allows them to pay a pittance for "menial jobs" while the government subsidizes low income workers with welfare programs, paid for by other tax payers instead of the starvation wage employer.
Wal-Mart doesn't care. They will raise everyone... they just accelerate everyone by about half a step when a MW increase happens. They call it a "market raise." They have to do that because they do have competitors they have to think about. I was working there when the last MW hike went through. Labor costs are not something WM worries about too much. They worry about unionization not because of payroll, which they can control, but because of health insurance, which they can't control.
Higher MW might actually help Wal-Mart, since turnover affects them more than most companies.
Walmart sure did care when MW went to $12.55 an hour in Oakland CA... it gave 72 hour notice the store would be closed permanently and then closed it.
Walmart sure did care when MW went to $12.55 an hour in Oakland CA... it gave 72 hour notice the store would be closed permanently and then closed it.
What??
They can't handle this
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