4 ways employers respond to Minimum Wage Laws( Besides Layoff)

[cpwill]

"but that is the downside of MW increases - people fired (earning $0/hr) or not hired (making $0/hr) at the higher MW."

I thought it was clear, but maybe that helped.

And obviously if there are two options:

1) 1,000 people hired at $7.50
2) 0 hired at $15

That's bad! The problem is this debate had been going on for decades, with some studies showing MW increases have a moderate impact on employment, others showing no or minimal impact, so we don't really know.

Sort of. Studies that show minimal or little statistically significant impact tend to focus on the workforce as a whole (ie: burying the percentage of people directly effected in the mass of people who aren't). Studies that show a moderate impact on employment tend to focus on the actual low-income folks who will be directly effected.

I could use the same logic (and, lest some rando idiot decides to invade this thread with hysteria, I am not arguing destructive equivalence) to argue that, since the A-bomb at Nagasaki - AT MOST - .0025% of the global populace (which is really within the margin of error), that it didn't kill anyone, or, at least, we can't say for sure that it did. Studies that focus more on the Japanese populace living within 25km of the city might have slightly different results.

What we can expect, I think, is the negative employment impact at $15 will be greater than at $12, and if we raise MW from $7.25 to $8, likely almost no impact.

:shrug: again, it depends on whether you are looking at the national populace as a whole, or studying the more specific populace of Nagasaki.

But that's the question... And then say there's an impact and 95% of those at the bottom are FAR better off, but 5% more are unemployed. Is that a good policy choice or not? Who knows? Depends on what your priority is.... And what the alternative is. Maybe we're better off with MW at $5, but transfer programs (EBT, EITC, Medicaid, etc.) to bring people up to $15?

If you wanted to raise everyone up to $15, that is exactly the better way to go about it. I would add that things like EITC should probably be made into monthly or bi-weekly payouts, vice annual, in order to get the actual intended benefit.

 

[Noodlegawd]

How many hours per week are you spending 50 bucks an hour on average, over the course of a year, to have your leaves picked up ?

That's a stupid question. I have hundreds of neighbors, all of whom are paying $50+ per hour for landscaping work.

 

[Logician Man]

That's a stupid question. I have hundreds of neighbors, all of whom are paying $50+ per hour for landscaping work.

No, the question is not stupid. You failed to mention you had 100's of neighbors, all of whom who are allegedly paying 50 bucks plus for landscaping work. That changes the scenario you presented earlier in a very significant manner. That you seem to fail to understand this fact is rather revealing.

 

[Noodlegawd]

No, the question is not stupid. You failed to mention you had 100's of neighbors, all of whom who are allegedly paying 50 bucks plus for landscaping work. That changes the scenario you presented earlier in a very significant manner. That you seem to fail to understand this fact is rather revealing.

I'm not sure what kind of bubble you think I must live in where landscapers charge $50/hour and I'm the only available customer, but lest you think that's the case, I've already addressed it:

"If I'm paying more than 5 times minimum wage, I'm sure there are hundreds of others doing the same who would gladly pay $15/hour plus their pro-rata share of health insurance premiums."

Not my fault if you can't read, or choose not to.

 

[Logician Man]

I'm not sure what kind of bubble you think I must live in where landscapers charge $50/hour and I'm the only available customer, but lest you think that's the case, I've already addressed it:



Not my fault if you can't read, or choose not to.

I can read quite well, thank you. Your post earlier ( the high lighted ) didn't state those 100's were your neighbors, Correct ? You could very well have been speaking about 100's on a citywide, county wide, statewide, or nationwide basis, Correct ?

 

[nekrodev]

How you get past minimum wage is to get a marketable skill. Which is something you own, and cannot be taken away from you. Minimum wage should be a starting point, not a career goal. It's where you should get your first taste of working and the responsibility that goes with it. When minimum wage is low employers will take a chance on you, give you a try. If they have to pay much more for workers who aren't all that productive, they will naturally look for alternatives. And you're not going to "double" everyone's wage; you are going to be giving a raise to the ones who are still employed. Only now even those will probably lose any benefits they might have had formerly and maybe get their hours reduced. And those are also the ones who will have to work that much harder to take up the slack. That's what we've seen happening.

Since you are so concerned with raising the minimum wage I'm sure you must oppose illegal immigration, since it is that huge pool of unskilled labor that is holding down wages, especially where minimum wage is prevalent.

None of this matters, because you're completely missing the point. This isn't about "paying people more" for the same work, it's about keeping up with inflation and rising prices, so that people stuck at the minimum wage aren't functionally making less than they would have 30-40 years ago.

 

[JasperL]

How you get past minimum wage is to get a marketable skill. Which is something you own, and cannot be taken away from you. Minimum wage should be a starting point, not a career goal. It's where you should get your first taste of working and the responsibility that goes with it. When minimum wage is low employers will take a chance on you, give you a try. If they have to pay much more for workers who aren't all that productive, they will naturally look for alternatives. And you're not going to "double" everyone's wage; you are going to be giving a raise to the ones who are still employed. Only now even those will probably lose any benefits they might have had formerly and maybe get their hours reduced. And those are also the ones who will have to work that much harder to take up the slack. That's what we've seen happening.

Since you are so concerned with raising the minimum wage I'm sure you must oppose illegal immigration, since it is that huge pool of unskilled labor that is holding down wages, especially where minimum wage is prevalent.

I'm indifferent about raising minimum wages. It's If you wanted to have an honest discussion, you'd have figured it out by now instead of arguing doubling someone's income won't make them better off. :roll:

 

[JasperL]

Sort of. Studies that show minimal or little statistically significant impact tend to focus on the workforce as a whole (ie: burying the percentage of people directly effected in the mass of people who aren't). Studies that show a moderate impact on employment tend to focus on the actual low-income folks who will be directly effected.

That's really not a fair two sentence summary of the conflict in the literature, which has been ongoing for a long, long time.

again, it depends on whether you are looking at the national populace as a whole, or studying the more specific populace of Nagasaki.

Really? So whether a doubling from 7.25 to $15 has a bigger employment impact than going from $7.25 to $8 depends on the sample? Do tell!

If you wanted to raise everyone up to $15, that is exactly the better way to go about it. I would add that things like EITC should probably be made into monthly or bi-weekly payouts, vice annual, in order to get the actual intended benefit.

I agree, and have said so. My point is that if you oppose MW, the next question is how do we do what the MW increases are intended to do. On the right wing, it's often/mostly "I oppose MW. I oppose welfare. Kill ACA. Kill Medicaid expansion. Socialism!!" So if the ACTUAL alternatives are the simpler MW increases versus nothing, then maybe MW increases are the better option.

 

[JasperL]

Sort of. Studies that show minimal or little statistically significant impact tend to focus on the workforce as a whole (ie: burying the percentage of people directly effected in the mass of people who aren't). Studies that show a moderate impact on employment tend to focus on the actual low-income folks who will be directly effected.

I could use the same logic (and, lest some rando idiot decides to invade this thread with hysteria, I am not arguing destructive equivalence) to argue that, since the A-bomb at Nagasaki - AT MOST - .0025% of the global populace (which is really within the margin of error), that it didn't kill anyone, or, at least, we can't say for sure that it did. Studies that focus more on the Japanese populace living within 25km of the city might have slightly different results.

FWIW, here's a discussion about the various studies. All of them examine the impact on the MW group, and none look to employment as a whole.

https://www.frbsf.org/economic-rese...cember/effects-of-minimum-wage-on-employment/

When you claim that the research showing small impacts is intellectually dishonest, you're just using falsehoods to smear the 'opposition.' It's enough to cite the research and discuss the actual disputes, and none of them is - those guys who show very small impacts are hacks.

 

[cpwill]

That's really not a fair two sentence summary of the conflict in the literature, which has been ongoing for a long, long time.

It's a pretty apt encapsulation of what I've seen, but I'll take a look through the link you've provided.

Really? So whether a doubling from 7.25 to $15 has a bigger employment impact than going from $7.25 to $8 depends on the sample? Do tell!

....no.

What I was responding to from the statement of:

What we can expect, I think, is the negative employment impact at $15 will be greater than at $12, and if we raise MW from $7.25 to $8, likely almost no impact.

Was not the "greater than" but the "likely almost no impact".

I agree, and have said so. My point is that if you oppose MW, the next question is how do we do what the MW increases are intended to do.

Well, that depends on the "what they are intended to do".

For those who support increasing MW simply because they want to stick it to employers/the rich/etc.; well, nothing. I don't want to "stick it" to any part of our interdependent economy (except for used car salesmen who do their own television commercials. There oughta be a law.).

For those who supported increasing MW because they wanted the increased unemployment effects; well, nothing. I don't think we ought to have policy that deliberately traps people out of work.

For those who support increasing MW because they want to improve the lives of the working poor, however, I support a Negative Income Tax of 50% of all monies not earned below 200% of the Federal Poverty line, which would bring every family with a single worker earning even minimum wage out of poverty.

I'm also not against ideas like (above) making the EITC payable on a monthly or bi-weekly basis, adding work requirements for able-bodied adults without children to SNAP, getting rid of the massive marriage penalties our government imposes, etc.

 

[Beowulf]

I'm indifferent about raising minimum wages. It's If you wanted to have an honest discussion, you'd have figured it out by now instead of arguing doubling someone's income won't make them better off. :roll:

But making then illegal to be employed won't help them at all.

 

[JasperL]

It's a pretty apt encapsulation of what I've seen, but I'll take a look through the link you've provided.

....no.

What I was responding to from the statement of:

Was not the "greater than" but the "likely almost no impact".

It's a roughly 10% increase, in a world where most of the country is already ABOVE $8 through state laws, and we've got a record low number of workers being paid at the MW. Why would that increase from $7.25 to $8.00 have a big impact. And no, it's not the sample - no research on the impact of MW looks at the total working population as their primary sample, at least that I've seen.

Well, that depends on the "what they are intended to do".

For those who support increasing MW simply because they want to stick it to employers/the rich/etc.; well, nothing. I don't want to "stick it" to any part of our interdependent economy (except for used car salesmen who do their own television commercials. There oughta be a law.).

For those who supported increasing MW because they wanted the increased unemployment effects; well, nothing. I don't think we ought to have policy that deliberately traps people out of work.

Whatever - obviously you know what I am arguing, and it's NOT that.

For those who support increasing MW because they want to improve the lives of the working poor, however, I support a Negative Income Tax of 50% of all monies not earned below 200% of the Federal Poverty line, which would bring every family with a single worker earning even minimum wage out of poverty.

Great, but in real life what you want might not happen. Hence, my concern about the actual alternatives, not what theoretically is better but that's not on the board IRL

I'm also not against ideas like (above) making the EITC payable on a monthly or bi-weekly basis, adding work requirements for able-bodied adults without children to SNAP, getting rid of the massive marriage penalties our government imposes, etc.

Fine...

 

[jet57]

Um, a minimum wage makes illegal to hire workers who fall below the minimum wage. That's what a minimum wage means.

Um, but it doesn't cover hours. Amazon for instance pays $15 an hour, but what is $15 an hour times 4?

 

[JasperL]

No, but I've asked a few different landscapers in our area for quotes, and none have offered better, so I have reason to believe it's the going rate. If I'm paying more than 5 times minimum wage, I'm sure there are hundreds of others doing the same who would gladly pay $15/hour plus their pro-rata share of health insurance premiums.

You're paying transportation time, time it takes to dispose of the leaves, maybe a dumping fee, charges for the wear and tear on equipment and vehicles, gasoline, repairs, office expenses, advertising and marketing, profit for the owners.

 

[jaeger19]

What I was actually assuming is costs might to up to FULLY offset the increases in wages, but that if that happens, those who benefit from a MW hike will still be far better off.

I just briefly looked at Walmart's financials. Cost of sales (rounded) are about $400B, and SG&A in total is about $100B. Let's say half that is wages paid to those impacted by MW - $50B - and that costs doubles. So total is now (400 cost of sales + 150 SGA) $550. That's a 10% increase in costs. So they raise prices by 10% or 12%. Well, if you make $10 and hour and go to $15, your wages go up 50%.

I'm sure you'd rather have a 50% increase in wages with 10% increase in your costs...

Besides, the argument is not that those impacted, who earn the higher MW, won't benefit (they will!), it's those who got fired, or jobs not created that we cannot really see that are the harm. That's a different analysis than the one I responded to.

!. I agree that costs will not go fully up to offset the increase in wages. There are too many mechanisms like outsourcing and automation to make that happen.

2.

Besides, the argument is not that those impacted, who earn the higher MW, won't benefit (they will!), it's those who got fired, or jobs not created that we cannot really see that are the harm. That's a different analysis than the one I responded to.

and the potential stagnation or contraction of wages in the middle.

Ultimately what will stop such a huge increase in the minimum wage will be the angst it caused the middle class.

No one who is making 20 dollars an hour now.. is going to want to see the fellow making 10 now..suddenly start making 15... without their wages going up.

You would think that this would put upward pressure on wages.. but the reality is that when the government arbitrarily says "now its 15"...employers are handed a perfect excuse to stagnant those in the middle. "sorry but no cost of living this year because of what the government did".

 

[jaeger19]

You're paying transportation time, time it takes to dispose of the leaves, maybe a dumping fee, charges for the wear and tear on equipment and vehicles, gasoline, repairs, office expenses, advertising and marketing, profit for the owners.

Insurance, workers comp, FICA on the employees,

 

[Rogue Valley]

Cut Hours Rather Than Workers
Make Employees Work Harder
Cut Other Elements of Remuneration
Hire Fewer People, More Robots

Cut a check for the Republican party.

 

[charliebrown]

There are a ton of other methods to fight minimum wage.
Get government lower your taxes
Get government to open free trade with third world countries
Move factories to said countries.
Import products from said countries.
Sell said products to displaced workers.
Get government to regulate your industry to protect your interests.

We have worker A flipping eggs for worker B before he heads to work.
We then have worker B flipping hamburgers for worker A after he is done working.
What a wonderful life we have!!!