RE: Living wage
June 24, 2015 at 12:05 pm
(This post was last modified: June 24, 2015 at 12:28 pm by Mister Agenda.)
(June 24, 2015 at 9:17 am)abaris Wrote:(June 24, 2015 at 9:09 am)polar bear Wrote: In the face of conservatives saying raising minimum wages would put business' out of business or cause inflation, Ikea is proving the exact opposite. The last time I checked, Ikea is a corporation and it's main interest is to make as much profit as possible. If raising the minimum wage didn't help accomplish this my guess is they would not have done it.
Yeah, the conservative argument is total bull. These international companies also have to abide by the rules of the states they are operating in. So, McDonalds for example has to respect food safety regulations as well as working conditions and wages being in accordance with the law of the land. That means, you don't get a crappy meal for 98 cents in my country, but you can also be sure that the workers aren't outright exploited and the burger isn't made out of some waste products of the meat industry.
Walmart for example withdrew from Germany after a very short period of time because they didn't make enough of a profit for their liking.
I don't trust conservatives to be honest about their motives, but even a stopped clock is right twice a day. There are negative consequences to a higher minimum wage. Just because they likely don't apply to large corporations doesn't mean they are nonexistent.
I would like to see a higher wage for the associates who report to me in my own company...but we're a government contractor that has to rebid every five years against other companies who say they can do what we do better and cheaper. Raising wages across the board could put us at a competitive disadvantage that loses us our contract and closes down the division leaving us all scrambling to find another job within or without the company. We can't afford to be a trendsetter in raising wages (I only make a little more than $20 an hour myself, so I would surely be a beneficiary of wage increases by 'trickle up'). However we could survive a minimum wage hike that affected our competitors equally.
However, say I am a corner grocer who takes home $80,000 a year from my grocery business. I have five employees and their wages average $10 an hour, about $21,000 a year. If the minimum wage is raised to $13 an hour, my yearly expense for wages goes from about $104,000 to about $135,000. Because of the minimum wage hike, I've had to raise my prices anyway to account for the extra expenses of my suppliers, so let's assume all other things are equal and the extra money comes out of the profits I take home, which are now $49,000. I've taken a $31,000 pay cut and maybe I should find another line of work if I can't cover my expenses on less than $50,000 a year or maybe I have to raise my prices, which is going to be pretty popular, and raises the cost of living for my employees so they effectively aren't doing any better than before.
When I worked minimum wage back in the eighties (not counting working less than minimum my first year in the USAF), I went through two minimum wage hikes. The second time I was expecting the surge in prices that entirely devoured my raise. Food and clothing are heavily dependent on low wage labor, and the prices will go up as dramatically as the wage increase (not based on my anecdote, economists have an unusual degree of consensus on this).
I'm not saying don't raise the minimum wage. I'm saying do it smart. Raise it gradually under a regime where each hike is known about well in advance, and it should be at least over a 5 year period to minimize economic disruption, with provisions to slow down the schedule if the economy takes a bad turn. Make an exception for the demographic of workers that are already having trouble getting hired at current minimum wage, people under 25; and maybe make an exception for small businesses with fewer than a certain number of employees, with a safeguard against big corporations spinning off divisions to take advantage of that.
It's no big feat for a company that is only paying 1% of its workforce under what's considered a living wage already to bring their minimum wage up. It can be a disaster for a company that pays 90% of its workerforce under that wage.
I'm not anti-Christian. I'm anti-stupid.