22 minimum wage. Will it kill many small business?

Discussion in 'Debate Hall' started by LacLongQuan, Mar 19, 2013.

  1. SLange

    SLange Guest

    Interesting question Dom. I would say an employer needs to compare the market.com to ensure skilled workers are remunerated at a fair rate i.e test the rate of other skilled workers in the same field and ensure they are no worse off. As far as I am aware, and I am no expert on the US employment set up workers negotiate their rate of pay?
  2. Dominotx711

    Dominotx711 Well-Known Member

    May 28, 2012
    hahahahahaha, ok....no not true. And what happens in the US is they raise minimum wage, the percentage does NOT increase across the board. So as I have previously stated, you make 9.00 an hour here minimum wage.....I make 12.00 for doing something I have done 19 years...hardly fair...just saying.
  3. SLange

    SLange Guest

    Ok. I am only aware of professionals who moved to US and negotiated their rate of pay before starting, how they fare now I don't know. However, I do think that suppressing wages is never a good thing. It does the economy no good at all. The onus is on workers to ensure their rate of pay is fair and that is the never ending battle between the employed and da management :)
  4. LacLongQuan

    LacLongQuan Well-Known Member

    Nov 3, 2012
    I am living in San Jose CA, the city just passed the minimum wage of 10/hour from 8/hour. The pizza hut I used to go get pizza had a pizza of the same size and toppings 10USD now 15USD. The affect for this raise of price is less people will go to buy a pizza which will force the owner to lay off worker because of less business. In the end, it will hurt the workers most as now they will have no job.
  5. Sharpshooter

    Sharpshooter Guest

    When consumers have better wages, they spend more. How can that be bad for small businesses?
  6. sirerik

    sirerik Member

    Jan 15, 2013
    Raising minimum wage does not give consumers more money to spend, it transfers money from more productive workers to less productive workers.
  7. Sharpshooter

    Sharpshooter Guest

    How so? Raising the minimum wage helps the lowest wage earner meet the increased costs of living that have gone up over the years, while their wages have essentially stayed stagnant for the last 40 years in the U.S.

    Raising the MW(Minimum Wage) lifts those who are functionally the working poor into a relatively better financial position then they were before, allowing them to purchase more consumer goods, which trickles back into the economy, which is good for workers, business, shareholders, and the general tax revenue of the nation.
  8. Hellstromm

    Hellstromm Active Member

    Mar 2, 2012
    The presumption that those on minimum wage are less productive is a typical, and unfortunately common, presumption that wealth directly correlates to that of work effort. Statistics demonstrate the exact opposite. That those who receive higher wages tend to do less work.
  9. Sharpshooter

    Sharpshooter Guest

    Eggsactly! (Apologies, this Easter Egg Quest has unfortunately permeated permanently into my brain meat )

    Anyways, it's a complete misnomer that MW workers don't work as hard, or as long as someone making a 'middle class' or 'union type wage', let alone what the 1% fat-cats make. This is why labour in China is cheap...but the actual labour put in is quite tough.

    I think it's also quite clear that those living on minimum wage often have to supplement that income with another job or jobs, especially if they're a sole provider, or have to support the 'American Dream' of spouse, 2.3 kids, a dog and a house with a white picket fence. Tough to maintain that when you lose your well paying job and have to sustain that on a minimum wage.
  10. sirerik

    sirerik Member

    Jan 15, 2013
    Work effort and productivity are not the same. An entry level worker can place a great deal of effort learning how to do a job, effort used to learn a job which is not directly applied to producing goods or services. A trained worker is worth more to an employer than an untrained due to wages not spent on training. Raising MW erodes the pay of trained workers because their pay rarely goes up the same percentage, yet the cost of goods and services to increase.
    Not all effort has the same value, we might not like it but that does not make it any less true. At this point in time the effort of a professional basketball player is worth more than a roofer’s effort. I cannot change spending priorities of every person on the planet, yet I can tailor my skill set to make my effort worth more money.
    A person knocks on your door looking to make some extra cash doing odd jobs. Do you hire her and how much do you pay? Do you ask if she is married and how many kids she has? Would you pay her the same to rake leaves as you would to install an HVAC system? You might want to pay her $30 an hour to rake leaves but would you? If the price of leaf raking is too high you will likely do it yourself or just let them sit there. When we increase the cost of a product or service less people will choose to purchase it.
    I don’t presume low wage earners to be lazy and I do not presume rich people to be evil. What I do believe is we all make decisions and decisions have consequences.
  11. SLange

    SLange Guest

    We call these apprentices and their productivity is effective, providing assistance to the trained worker with on the job training which results in a finished product, hence being productive.

    That is not necessarily true and the cost of goods and services are always rising. Nothing to do with MW. The onus is on the trained worker to ensure a fair parity as you say it's decision time.

    Wages are not about value, never have been, never will be. You said it. MW ensures people are not being exploited and addresses abject poverty.

    Depends what the product is people will always want pizza and an iphone. lol
  12. sirerik

    sirerik Member

    Jan 15, 2013
    So what should we raise minimum wage to?
  13. Sharpshooter

    Sharpshooter Guest

    You seem to be contradicting yourself here. First you acknowledge that a trained worker is worth more than an untrained one, and then you make the connection that somehow needing to train an untrained worker will cause the more valuable and productive worker to lose wages in order to make up for the less valuable and productive worker? Well, wouldn't that company or firm risk losing the more trained and valuable worker then? And if that risk is plausible, then the company or firm would be risking suppressing their overall productivity and therefor profit margins. Also, keep in mind that most 'firms' or companies already offer higher the MW wages, so they're irrelevant to this discussion. What we need to keep in mind is the Walmart's, Target's, McDonald's, and other anti-MW companies that exploit a cheap labour class in order to pad their already outrageous profits. The people at these kinds of places are the ones that need the raise, as they're the places that are seeing more and more adult workers joining their ranks, and who need to be able to support themselves better off the wages given. These places aren't the places of teenage employment any longer. Look around in them and you'll see people trying to raise families, pay mortgages, or supplement pensions. They're the ones who need the wages to go up.

    This isn't really a debate about effort though, it's a debate about income fairness. Taking an athlete and using them as the crux of your argument is a bit disingenuous because the salaries are wholely skewed. Although, i'm glad you brought them up, because EVEN in professional sports there's a Minimum Wage. It's called the League Minimum, and it goes up in sports. Imagine that?! Even in sports with salary caps like hockey, basketball, etc.. the minimum salary goes up through league-wide contract negotiations between owners and player associations. Where's the worker's association for those workers at Walmart or McDonald's?? Oh right, they don't have one, unless they're in a union....which is why union wages are better than non-union wages for the most part, and ultimately, it's the union wage that is more able to deal with the cost of living increases that almost every minimum wage worker isn't able to keep up with.

    I could go on, but I digress. This, in my humble opinion, is an issue of fairness. If the cost of living and inflation continues to change, just as it always has, even without a corresponding MW increase and all time record profits in many MW using industries, then it's only fair and reasonable that the MW wage keep up to the cost of living and inflation, and also go up.

    The Economist, November 2012: "Evidence is mounting that moderate minimum wages can do more good than harm...Britain’s small, regular changes [in the minimum wage] may be easier for firms to absorb than America’s infrequent but hefty minimum-wage increases.”
    Source: http://www.economist.com/news/finan...-moderate-minimum-wages-can-do-more-good-harm

    Bloomberg News, April 2012: "[A] wave of new economic research is disproving those arguments about job losses and youth employment. Previous studies tended not to control for regional economic trends that were already affecting employment levels, such as a manufacturing-dependent state that was shedding jobs. The new research looks at micro-level employment patterns for a more accurate employment picture. The studies find minimum-wage increases even provide an economic boost, albeit a small one, as strapped workers immediately spend their raises. Let us hope that states lead the way on the minimum wage, and that they tie increases to the cost of living, making endless rounds of legislation unnecessary. Then let us hope that fresh research and improved lives built on hard work compel Congress to follow.”
    Source: http://www.bloomberg.com/news/2012-04-16/u-s-minimum-wage-lower-than-in-lbj-era-needs-a-raise.html

    Crain's New York Business, February 2012: "“Critics of [the minimum wage] proposal are making the same arguments as the last time the Legislature increased the minimum wage, in 2004. The hike to $7.15 an hour from the federal minimum of $5.15 was phased in over three years. If the change had a cataclysmic effect on businesses that depend heavily on minimum-wage workers, we certainly missed it. Raising New York's minimum would not put it at a competitive disadvantage with New Jersey, where the wage floor is also $7.25. Businesses employing many minimum-wage workers tend to be in the service sector and must set up shop near their customers. Indexing the minimum wage to inflation is logical and would erase the pressure on lawmakers to keep returning to the issue. Objections . . . while meriting consideration, are essentially objections to the very existence of a minimum wage, which has been a fixture in the U.S. since 1938 and has never stopped our economy from flourishing.”
    Source: http://www.crainsnewyork.com/article/20120205/SUB/302059999#ixzz2H2tFGMTT

    Over 650 economists, including 5 Nobel prize winners and 6 past presidents of the American Economic Association, believe that increasing federal and state minimum wages, with annual cost-of-living adjustments for inflation, “can significantly improve the lives of low-income workers and their families, without the adverse effects that critics have claimed.”

    See the list of signatories and read the statement here : http://www.epi.org/page/-/pdf/epi_minimum_wage_2006.pdf

    - - - Updated - - -

    You mean what's fair, or what's legislatively passable? lol

    Fair = Keeping up with inflation at a minimum and in the last 40 years that would come out to about $10.67, which is much better than the current $7.25
    Last edited by a moderator: Mar 29, 2013
  14. sirerik

    sirerik Member

    Jan 15, 2013
    I appreciate the effort some of you have put in to this debate. Some of you are strongly in favor of raising MW. $10.67 sounds reasonable and possible, what are the negative consequences?
  15. Dominotx711

    Dominotx711 Well-Known Member

    May 28, 2012
    I believe the negatives have been amply pointed out. Not to mention my own pet peeve of it isn't fair.
  16. Sharpshooter

    Sharpshooter Guest

    I may have missed it, but how again is raising the MW not fair?
  17. sirerik

    sirerik Member

    Jan 15, 2013
    When there is low demand and high supply prices fall, when thereis low demand and high prices, demand drops even more. One unintended consequenceof raising MW is lower demand for entry level workers and that is not fair toour youth. In order to make an informed decision we must understand thepositives and negatives of a decision, weigh them and decide if the positivesoutweigh the negatives. There are several positives to raising MW, at thispoint in time I believe the negatives outweigh the positives and that is why Ioppose it.
  18. Sharpshooter

    Sharpshooter Guest

    The failure with this argument is that it presumes that the 'youth' are the ones that are filling those entry-level minimum wage jobs.

    That's not the case any longer.

    So, in reality, the 'youth' are not filling these jobs...in fact they're not even being afforded the opportunity to fill what used to be 'transitional jobs' while in school or in college or while entering the professional workforce.

    The youth argument is a non-starter in regards to the MW, because they're not necessarily the ones that are calling for it. It's the workers trying to raise their families or make ends meet that are, and they deserve a living wage, ie. a wage that they can minimally live on, without having to get gov't handouts, ie. being 'burden's on the taxpayer'.

    So the choice here is, get the corporations to increase their wages so people can make ends meet, or have the citizens pay more taxes, or have less taxes going to other vital programs like infrastructure, education, etc, to supplement and assist the working poor who aren't able to make ends meet on their low wages.

    Positives far outweigh the negatives, not only for those people making minimum wage, but for society/the tax paying public, as a whole.

    Hopefully you can see it from that angle and be willing to change your views.
    Hellstromm likes this.
  19. Dominotx711

    Dominotx711 Well-Known Member

    May 28, 2012
    Because it isn't raised across the board. You raise minimum wage without equal percentage for everyone and the skilled labor pool gets lopsided. And if you raise it for everyone, prices will go sky high, as the hiring plummets, and people lose jobs so business can stay in business.

    and in short, as to your above post rather than quote it, let me just say I disagree with it. The positives do not out weigh the negatives. People need to live in their means. And the capitalist effect will even out those who charge to much for things. They will run out of business......
    Last edited: Mar 31, 2013
    sirerik likes this.
  20. Sharpshooter

    Sharpshooter Guest

    Equal percentage for whom? Everyone making MW, would get the increase, across the board.

    The skilled labour is already making more than those at MW, and many of the unionized ones get benefits and can negotiate for small increases in wage over different contracts. The MW's can't, which is why it's more fair to get them an increase through the State or Fed levels.

    Again, hiring doesn't plummet, and costs don't go 'sky high'. That's hyperbole at best and disingenuous at worst. Again, more money in people's pocket equals more money going back into the economy, equals more businesses more goods or providing more services, equals more profit, equals being able to afford hiring or retaining staff in order to meet the increased demand, equals more better paying jobs, equals better economy, equals more tax revenues collected, equals better infrastructure and education and research funding, equals more jobs and a better and healthier nation.

    Trickle up economics...it works.

    And to your last point...the situation currently is not that people aren't living within their means, of course some aren't i'm not saying that there aren't those kinds of folks out there, but the majority of MW's are even able to make ends meet let alone live outside of their means. The means for these people is not adequate enough at $7.25 an hour, when inflation and rising costs of living are factored into year to year basic expenditures for families.

    This in not a problem about people being lazy, or looking for a handout, or living more extravagantly than they should, it's about the fairness of receiving a living wage, especially at a time when many corporations are reaping record profits on the backs of MW workers. It's a people over profits fairness issue. There comes a time when people have to stand by and up for one of those two categories.

    What would Jesus do? lol :p