Thread: Minimum wage....

Originally Posted by surasak

More evidence that raising the MW hurts:

But it only hurts if your government does not look after it's workers with an award system , stating minimum pay and benefits, that every employer (and employee) has to abide by.

Originally Posted by blackgang

local union 701 of operating engineers

Local 3, Oakland; mydamnself.

According to the article, there was a high turnover of teens who didn't really need the money, but were costing the company in training.
It's the serious breadwinners who benefit.

Well, the Employment Policies Institute in Washington, which opposed the wage hikes cited a 2003 report by Federal Reserve economists showing a 10 percent increase in prices caused a 2% to 3% decrease in employment.

Originally Posted by Boon Mee

Employment Policies Institute

The Employment Policies Institute is one of several front groups created by Berman & Co., a Washington, DC public affairs firm owned by Rick Berman, who lobbies for the restaurant, hotel, alcoholic beverage and tobacco industries. EPI, registered as a 501(c)(3) tax-exempt organization, has has been widely quoted in news stories regarding minimum wage issues, and although a few of those stories have correctly described it as a "think tank financed by business," most stories fail to provide any identification that would enable readers to identify the vested interests behind its pronouncements. Instead, it is usually described exactly the way it describes itself, as a "non-profit research organization dedicated to studying public policy issues surrounding employment growth" that "focuses on issues that affect entry-level employment." In reality, EPI's mission is to keep the minimum wage low so Berman's clients can continue to pay their workers as little as possible.

Employment Policies Institute - SourceWatch

That's still shit pay for the richest country and largest economy in the world, you couldn't survive on that wage doing a 40 hour week in the UK.

Originally Posted by buriramboy

That's still shit pay for the richest country and largest economy in the world, you couldn't survive on that wage doing a 40 hour week in the UK.

True, and I agree.

Now - here is the problem with raising the minimum wage.

No business will eat the increase in labor costs. They will pass the increase on to the consumer. The workers, who have had their wages increased, can now afford to pay more. So, effectively their net gain is actually "zero".


It is the retirees, who will not partake of the increase in wages, who will be screwed.

Originally Posted by bowie

Now - here is the problem with raising the minimum wage.

No business will eat the increase in labor costs. They will pass the increase on to the consumer. The workers, who have had their wages increased, can now afford to pay more. So, effectively their net gain is actually "zero".


It is the retirees, who will not partake of the increase in wages, who will be screwed.

Oversimplification.

Originally Posted by Black Heart

Originally Posted by bowie

Now - here is the problem with raising the minimum wage.

No business will eat the increase in labor costs. They will pass the increase on to the consumer. The workers, who have had their wages increased, can now afford to pay more. So, effectively their net gain is actually "zero".


It is the retirees, who will not partake of the increase in wages, who will be screwed.

Oversimplification.

No - a simple truth.

Originally Posted by bowie

Originally Posted by Black Heart

Originally Posted by bowie

Now - here is the problem with raising the minimum wage.

No business will eat the increase in labor costs. They will pass the increase on to the consumer. The workers, who have had their wages increased, can now afford to pay more. So, effectively their net gain is actually "zero".


It is the retirees, who will not partake of the increase in wages, who will be screwed.

Oversimplification.

No - a simple truth.

In some cases this will happen, in others it won't.

Australia has a high minimum wage but it's a very expensive country to be in these days simply because labor is so expensive.

Because of the high minimum wage Australians have no need to tip workers unlike America where the low paid expect and receive 15 % tip to make up their shitty wage.

The high minimum wage gives most Australians a fairly good level of living which in my opinion is a good thing for all concerned.

Penalty rates are a killer though, Weekends, Public holidays and Christmas labor rates are sky high which is passed onto the punting public of course.

Hard to run a competitive business in Australia but at least our strong labor laws protect the low paid from rouge employers.

Without a Union and strong Government employment laws the Low paid workers are exploited mercilessly.

The other side of it is the "competitiveness", supply and demand. Just what skill set do you bring to the table that justifies the higher wages, and, who is/are your competitors? Is/are the higher wages you demand affordable?

In that - as an employer, I need "happy" and productive workers to produce a high quality sellable product. Yet, to keep my workers happy at the bargaining table I will provide annual raises with incentives and bonuses. I must pass this cost on to my customers - or go bust. Now, when my customers will no longer purchase my quality - yet high priced product, I go bust. I am no longer profitable because of labor costs. All involved lose - my company is closed, my happy and productive workers are now the disgruntled unemployed blaming me for my mismanagement of the corporation.

Yet, during our happy and prosperous times of rising wages, my high priced former employees used to purchase my competitors cheaper low quality goods that were made in a foreign country using much cheaper labor.

A viscous cycle with an almost foregone conclusion.

^

It is certainly a travesty that Australian businesses are going broke because of their products being produced over seas at an inferior labor cost.

At the end of the day it is the same the world over so Australia ain't no orphan in this department.

I support the right of workers to be paid a proper wage but at the same time I Believe the employer must profit far above the employee.

If not, what is the point of actually running a business ??

Running a business is a total pain in the arse for most employers.

Certainly the small time Employers.

Throw in Maternity leave and why would ya.

This must be the worst benefit payable in the history of the world.

$15 per hour minimum wage hits the ballot in California.

A measure that would gradually raise California's minimum wage to $15 has qualified for the state's ballot in November.

Alex Padilla, California's secretary of state, announced Tuesday that the initiative had received the required 400,000 signatures needed to appear on the statewide ballot.

The proposal would hike California's minimum wage from the current $10 to $11 on Jan. 1, 2017. The wage would then increase by $1 each year until reaching $15 in 2021. The state already boasts one of the highest minimum wages in the country.

$15 minimum wage measure qualifies for California ballot - Mar. 23, 2016

It's 'Business Insider' so I don't know what their bent is, if any.

But I think the minimum wage needs raising, as it's been so low for so long.

It's all about protecting the business. Jaysus. Yeah, we know about the automation. It was gonna happen anyway, but this min wage increase may accelerate it.

I swear that BSNUB STARTED A GOOD MINIMUM WAGE THREAD.


I searched a couple times and no luck.

Where is it?

Minimum wage hikes are causing businesses to cut jobs
Garret/Galland Research
Stephen McBride, Garret/Galland Research
Mar. 16, 2017

minimum wage REUTERS/Lucy Nicholson/Files
In January, 19 US states raised their respective minimum wages. Washington was among the most generous, hiking by $1.53 (bringing it to $11 per hour). Arizona got an increase of $1.95—their “bottom rung” now sits at $10 per hour.

In all, 4.3 million workers are slated to receive a hike as they earn less than the new minimum wage in their respective states. Well, that’s what’s meant to happen. Judging by the fallout from recent hikes, it seems things aren’t going according to plan.

Minimum Wage Massacre

In February, Wendy’s CEO Bob Wright said the firm expects wages to rise at least 4% in 2017. Wendy’s has three options to offset the rising costs.

First, they could cut margins, but with an 8% margin, that’s unlikely. The second option is to raise prices. Given how price-sensitive consumers are these days, that too is a non-starter. Finally, the firm could reduce the amount of labor they use… and that’s exactly what they did. Wendy’s eliminated 31 hours of labor per location, per week.

However, their locations are just as busy. To keep output steady, they are planning to install automated kiosks in 16% of their locations by the end of 2017. David Trimm, Wendy’s CIO said the timeframe for payback on the machines would be less than two years, thanks to labor savings.

Market leader McDonald’s has also been automating. Last November, the firm said every one of its 14,000 US stores will be replacing cashiers with automated kiosks. McDonald’s has actually prioritized these changes in locations like Seattle and New York that have higher minimum wages.

The restaurant industry is the canary in the coal mine when it comes to raising the minimum wage. In 2015, two-thirds of workers earning minimum wage were employed in service occupations (mostly food preparation). Today, restaurants spend (on average) one-third of their revenue on labor.

Currently, rising labor costs are causing margins in the sector to plummet. Those with the ability to automate like McDonalds are doing so… and those who don’t are closing their doors. In September 2016, one-quarter of restaurant closures in the California Bay Area cited rising labor costs as one of the reasons for closing.

With the restaurant industry flashing warning signs, what do higher minimum wages mean for the rest of the economy?

Labor Lockout

In 2015, the percentage of hourly paid workers earning the prevailing minimum wage was 3.3%. While this may not seem like a lot, young people are disproportionately impacted. Around 68% of these workers are between ages 16 and 34.

A key point is that in 2016, 20.6 million workers (30% of all hourly, non-self-employed workers 18 and older) were ‘’near-minimum-wage workers.’’ This means they earned more than the prevailing minimum wage but less than $10.10 per hour. Some states have already surpassed this level, with many more on an incremental path toward it.

While wage increases put more money in the pocket of some, others are bearing the costs by having their hours reduced and being made part-time.

A recent example of this is in Seattle. In 2015, the Rainy City raised its minimum wage from $9.47 to $11 per hour. The effects? A study from the University of Washington in 2016 found that it decreased low-wage employment by 1%.

The study also found that while median wages rose, this was largely due to a strong economy. It’s important to note these increases don’t happen in isolation. The cost of wage hikes can be masked by a strong economy.

The study went on to say that working hours were reduced as a result of the hike. Interesting, many individuals actually moved their residence to take jobs outside of the city “at an elevated rate compared to historical patterns.’’

The 2015 bill included a provision in which firms with over 500 employees must pay a $15 per hour minimum wage starting January 2017. For companies with under 500 employees, it’s $13 per hour. Given this, Seattle is the closest thing there is to a controlled experiment on this topic.

With calls for further minimum wage increases likely to continue, what can we expect going forward?

Automation Annihilation

When signing a bill that will raise California’s minimum wage to $15 per hour by 2022, Governor Jerry Brown was very observant. Brown said, “Economically, minimum wages may not make sense. But morally, socially and politically they make every sense.”

Brown is correct about the political part, but otherwise swings a miss. This hike will increase the cost of labor. Therefore, some jobs will be priced out of existence and some workers will be out of jobs. This table shows how the hike will incentivize capex projects (aka job automation).

Screen Shot 2017 03 15
Garrett/Galland

Unfortunately, those who will suffer most are the young and low-skilled… the very people such laws are meant to help. In fact, Governor Brown knows this well. In 2014, he said that raising the wage would “put a lot of poor people out of work.”

There are also many studies that prove a rising minimum wage reduces low-skilled employment. This isn’t a US phenomenon either. Across Europe, there are higher unemployment rates in countries that have minimum wages.

Higher labor costs render low-skilled workers unemployable as it removes their key competitive advantage—cost. As a result, they are being replaced by machines. This is part of the wider issue of automation.

A 2013 study from the University of Oxford concluded that 47% of jobs in the US will likely be automated over the next two decades.

A 2017 report by McKinsey that looked at the ability of machines to replace human labor drew the same conclusion. The report found that 59% of all manufacturing tasks could be automated using current technology. The most exposed sector is food service, where 73% of tasks could be automated.

The inflation-adjusted minimum wage peaked back in 1968. However, it seems to be doing more harm than ever today. This is partly because of technological advancement, which has accounted for 88% of the 5 million manufacturing jobs lost since 2000.

Unless we stop seeing “political-sense” attempts to raise minimum wages, we are likely to see a lot more Flippy’s very soon.

Minimum wage leads to job losses - Business Insider