Introduction and key findings
The minimum wage was established in 1938 as part of the Fair Labor Standards Act (FLSA). In addition to prohibiting child labor and mandating the 40-hour workweek, the FLSA established the federal minimum wage to help ensure that all work would be fairly rewarded and that regular employment would provide a decent quality of life. Moreover, regular increases in the minimum wage were meant to ensure that even the lowest-paid workers benefited from broader improvements in wages and living standards.
Yet today, because of decades of infrequent and inadequate adjustment, the federal minimum wage no longer serves as an adequate wage floor. Every year that the minimum wage is left unchanged, rising prices slowly erode its buying power. In 2014, the federal minimum wage of $7.25 was worth nearly 10 percent less than when it was last raised in 2009, after adjusting for inflation. In fact, the real (inflation-adjusted) value of the federal minimum wage in 2014 was 24 percent below its peak value in 1968.
This decline in purchasing power means low-wage workers have to work longer hours just to achieve the standard of living that was considered the bare minimum almost half a century ago. Over that time, the United States has achieved tremendous improvements in labor productivity that could have allowed workers at all pay levels to enjoy a significantly improved quality of life. Instead, because of policymakers’ failure to preserve this basic labor standard, a parent earning the minimum wage today does not earn enough through full-time work to be above the federal poverty line.
In April 2015, Sen. Patty Murray (D-Wash.) and Rep. Robert “Bobby” Scott (D-Va.) introduced the Raise the Wage.e Act of 2015, a bill that would raise the federal minimum wage in five steps to $12 per hour by 2020. Beginning in 2021, the minimum wage would be “indexed” to median wages so that each year, the minimum wage would automatically be adjusted based upon growth in the median wage. The bill would also gradually increase the sub-minimum wage for tipped workers (or “tipped minimum wage”), which has been fixed at $2.13 per hour since 1991, until it reaches parity with the regular minimum wage.
Report • By David Cooper • July 14, 2015, from here.
Excerpt:
Wow! Is Uncle Sam playing catch-up in the minimum-wage, or what?!?
Discuss ...
______________________________
Report • By David Cooper • July 14, 2015, from here.
Excerpt:
Wow! Is Uncle Sam playing catch-up in the minimum-wage, or what?!?
Discuss ...
______________________________
Raising the minimum wage might lift wages for 35 million workers, but it'll also raise prices for over 300 million citizens (which includes those 35 million workers.
You ever heard of costs and benefits? Mr. Cooper talked a whole lot about benefits, but completely ignored the costs side of the issue.
TANSTAAFL, you know.
It would encourage 35 million to stay in that dead end job.
The only way to raise minimum wages so that the poor will benefit is to bring in a commission system, and, make for a living wage based on the minimum wage.
Report • By David Cooper • July 14, 2015, from here.
Excerpt:
Wow! Is Uncle Sam playing catch-up in the minimum-wage, or what?!?
Discuss ...
______________________________
Report • By David Cooper • July 14, 2015, from here.
Excerpt:
Wow! Is Uncle Sam playing catch-up in the minimum-wage, or what?!?
Discuss ...
______________________________
Report • By David Cooper • July 14, 2015, from here.
Excerpt:
Wow! Is Uncle Sam playing catch-up in the minimum-wage, or what?!?
Discuss ...
______________________________
I like the bill. It's time for the bill. But, IMO, it doesn't go far enough. There should be a two-tiered system whereby those people under age 18 get paid X% of the higher minimum.
I think we will be surprised how this significant change will positively impact this country. The quality of our labor force will improve. There will be more competition for jobs causing people to elevate their education and skills.
Examples: I'm not going to have to struggle to understand a minimum wage ESL employee at the drive-thru. There will be enough competition for that $12 an hour job to create the incentive we need to see our immigrants anxious to hone their English language skills. Or they'll be out of work. Next, there will be more competition for jobs -- again incentivizing people to perform better and improve their work ethic.
Will we have to pay more for things? Yes,we will. But if we aren't willing to pay more for things in order for people left fortunate than ourselves to earn enough money thru a job-and-a-half to support themselves, we should probably re-evaluate our mindset. Will it have unintended consequences? What doesn't? But this isn't a reason to keep the minimum wage so low that the least of us can't support ourselves.
I'd rather encourage people to be motivated enough not to accept a low wage job if they want more money than mandate businesses pay more money whether the employee is worth it or not (in terms of value to the business).
But your two-tiered system will only encourage business to engage in age discrimination. Why would they hire older workers if they can get their job done with a younger worker?
I like the bill. It's time for the bill. But, IMO, it doesn't go far enough. There should be a two-tiered system whereby those people under age 18 get paid X% of the higher minimum.
I think we will be surprised how this significant change will positively impact this country. The quality of our labor force will improve. There will be more competition for jobs causing people to elevate their education and skills.
Examples: I'm not going to have to struggle to understand a minimum wage ESL employee at the drive-thru. There will be enough competition for that $12 an hour job to create the incentive we need to see our immigrants anxious to hone their English language skills. Or they'll be out of work. Next, there will be more competition for jobs -- again incentivizing people to perform better and improve their work ethic.
Will we have to pay more for things? Yes,we will. But if we aren't willing to pay more for things in order for people left fortunate than ourselves to earn enough money thru a job-and-a-half to support themselves, we should probably re-evaluate our mindset. Will it have unintended consequences? What doesn't? But this isn't a reason to keep the minimum wage so low that the least of us can't support ourselves.
If I assume you believe a 16-year-old is equal in skills and work ethic to a 30-year-old single mom, then I would remind you that the number of kids between 16 and 18 who want to and can work, is woefully inadequate to field all the minimum wage jobs out there.
Your mindset is self-serving, IMO. It's time we looked at the workers who are exploited.
Economists=eggheads with fancy degrees that I hire to make me richer,instead of themselves.
Great,another thread in which people who have never worked (or owned) in the restaurant business is going to tell those of us with years of experiance in the profession what to do with our businesses.
Let the armchair quarterbacking begin.
Your point has merit, though not complete merit. Any business looking to be profitable will, at the least, consider the up and down sides of your two-tiered system. While not all businesses will see an upside likely to happen, some will. That means that some job applicants will be discriminated against based on their age.
Do you think your two-tiered system is really worth such discrimination...and the resultant political, social and legal fights that will occur?
btw, workers are not "exploited". They are free to work for an agreed upon wage and they are free to look elsewhere if they do not agree to the wage. They certainly don't need the government to tell possible employers what to pay them.
Another group left to ponder why raising labor costs (for everything by mandate) is "good for all of us" are those living on fixed incomes whether private retirement pensions or public assistance.
As you are well aware, increasing the cost of sales requires increasing sales revenue or reducing profit. The guy (or gal) mowing grass is not suddenly going to produce more, just because their paycheck was mandated to grow, so their employer has but one option - raise the price of their lawn care services. That sweet little 80 year old lady, who needs her lawn mowed, is not likely to feel helped by all of that "fairness".
Report • By David Cooper • July 14, 2015, from here.
Excerpt:
Wow! Is Uncle Sam playing catch-up in the minimum-wage, or what?!?
Discuss ...
______________________________
If I assume you believe a 16-year-old is equal in skills and work ethic to a 30-year-old single mom, then I would remind you that the number of kids between 16 and 18 who want to and can work, is woefully inadequate to field all the minimum wage jobs out there.
Your mindset is self-serving, IMO. It's time we looked at the workers who are exploited.
Seriously,didn't we just have a thread the same as this a day or two ago?
The average hourly wage for workers affected by the increase jumped from $9.96 to $11.14, but wages likely would have increased some anyway due to Seattle's overall economy. Meanwhile, although workers were earning more, fewer of them had a job than would have without an increase. Those who did work had fewer hours than they would have without the wage hike.
Why raising the minimum wage in Seattle did little to help workers, according to a new study
Why is it "best" to use the 1968 (historic high, inflation adjusted) value of the federal MW? If one used the 1938 (initial) value of the MW then today adjusted for inflation it would be about $4.20/hour. If one used the 1939 (after the largest increase in MW history which was a 100% increase) value of the MW then today adjusted for inflation it would be about $8.40/hour.
Arguing for inflation adjustment (indexing it to the CPI) of the MW I can agree with - choosing a (cherry picked?) MW value which was raised farthest above inflation to become the baseline actually goes against using inflation as the rationale for indexing the MW to the CPI.
Why is equal pay for equal work suddenly a bad idea? One does not need experience to perform "unskilled" labor and the assumption that "work ethic" suddenly changes at age 19 is just as silly (and discriminatory?) as saying that "work ethic" changes with gender.
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