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Thread: Minimum Wage Hikes Reduced Employment of Low-Skilled Workers

  1. #91
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    Re: Minimum Wage Hikes Reduced Employment of Low-Skilled Workers

    And still, not a single post with any evidence backing up the claim in the OP.


    What is one to think?
    Quote Originally Posted by calamity View Post
    Reports indicate that everyone knew he was hauling a bunch of guns up there. But, since you brought it up, there's something which should be illegal: guns that breakdown.

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    Re: Minimum Wage Hikes Reduced Employment of Low-Skilled Workers

    Quote Originally Posted by KevinKohler View Post
    Minimum wage went up to 9.15 in CT. From 8.25, or something. My company employees a lot of minimum wage workers. None of them got laid off. Not in any of the stores.


    The bottom line is this...a company doesn't hire or fire based on the expense of doing so, their primary reason is need. We NEED those employees, so even though the cost to employ them just went up, we can't AFFORD to let any of them go.

    We have also not raised prices....well, except for beef. Beef is skyrocketing all over the place, though.


    Never read an economics book have you?

    No to all.

    I have run and owned a few companies. The COST of hiring is one of the most difficult and costly aspects of running a business. The rule is fast and hard. You need to hire when the demand is there and you have to expand to meet it. If the cost of hiring is too great, you simply do not expand, and if margins are low, as they are now, and borrowing is risky, you down size, lay people off.

    In a stalled or slow growth economy, there is no margin headroom, you dare not increase prices to meet the cost of labor, you will lose all and more of the business you are trying to chase.

    Sometimes, you can meet a spike in demand with overtime, which is cheaper than hiring a new, full time, breaking them in etc.

    There is NOT ONE business text nor plan, there is NOT ONE economics text that does not directly correlate government regulated cost of hiring increases and LESS employment.
    ""You know, when we sell to other countries, even if they're allies -- you never know about an ally. An ally can turn."
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    Re: Minimum Wage Hikes Reduced Employment of Low-Skilled Workers

    It seems to me that this is the critical "hidden" paragraph:

    In July 2009 roughly half of US states were bound by the new federal minimum to increase their minimum wage rates by 70 cents, from $6.55 to $7.25 per hour. The remaining states’ minimum wage rates changed by an average of roughly 10 cents. The first dimension of our analysis thus compares changes in the employment of low-skilled workers in ‘bound’ relative to ‘unbound’ states.
    About half of U.S. states had minimum wage laws near the 7.25 target. Things didn't get worse in those states. The point that seems to be lost, then, is that minimum wage as such doesn't lead to worse employment outcomes, but rather, changes to minimum wage, and presumably, quite a few other factors. I don't have a lot of time, but consider that if profits to shareholders remained constant across all industries, costs were raised a little behind wages (as is normal), and wages were raised in proportion to gross revenues, there wouldn't be any problem. The problem occurs because we don't control everything that needs to be controlled in order to have a good economy.

    It really should be a no-brainer to have a minimum wage; anyone who looks at labor conditions before the reforms of the 20's and 30's should learn this lesson. The complaint from those who oppose minimum wage hikes is really that because the wealthy have become accustomed to ever greater shares of wealth, minimum wage increases lead to lower employment levels. An almost exact analogy occurs when someone is on the road to becoming obese: because the person is becoming accustomed to consume ever more calories, any increase in exercise will lead them to eat still more. The ridiculousness of such an argument against exercise should be obvious, but it's more or less just what opponents of minimum wage increases are really saying.

  4. #94
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    Re: Minimum Wage Hikes Reduced Employment of Low-Skilled Workers

    Fearandloathing;1064207016]

    The COST of hiring is one of the most difficult and costly aspects of running a business. The rule is fast and hard. You need to hire when the demand is there and you have to expand to meet it.
    Yes, human resources tend to be the most costly investment most businesses will make. And yes, you hire, or add payroll, when there is more demand, IE, labor needing to be executed.

    If the cost of hiring is too great, you simply do not expand, and if margins are low, as they are now, and borrowing is risky, you down size, lay people off.
    If the cost of hiring MORE employees exceeds the amount the increased business would earn you, you have a flawed business model, one that was flawed BEFORE any increase to minimum wage to begin with. Think about it. What you are suggesting is that you can't AFFORD to bring in more business. I've run businesses, too. And I know that a business that can't afford to keep up with it's business, has problems in other areas, beyond human capital. You lay people off when there is less work, IE, less business....you don't stick your middle finger out at customers just because you have to pay your employees more. If the cost of employing people exceeds the money your business brings in, you close your doors.

    In a stalled or slow growth economy, there is no margin headroom, you dare not increase prices to meet the cost of labor, you will lose all and more of the business you are trying to chase.
    So to sum up, increases to minimum wage, according to you, means massive business closures, since they don't dare increase prices, and paying their employees now exceeds income from business.

    Sometimes, you can meet a spike in demand with overtime, which is cheaper than hiring a new, full time, breaking them in etc.
    Planning your business around limited time increases in demand is a poor business model. You're either growing, or you're dying.

    There is NOT ONE business text nor plan, there is NOT ONE economics text that does not directly correlate government regulated cost of hiring increases and LESS employment.
    Correlation does not equal causation. The periods of highest minimum wages were also the periods of greatest economic largess in this country, and of all the countries in the world, the wealthiest all have the highest minim wages.
    Quote Originally Posted by calamity View Post
    Reports indicate that everyone knew he was hauling a bunch of guns up there. But, since you brought it up, there's something which should be illegal: guns that breakdown.

  5. #95
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    Re: Minimum Wage Hikes Reduced Employment of Low-Skilled Workers

    Quote Originally Posted by ashurbanipal View Post
    It seems to me that this is the critical "hidden" paragraph:



    About half of U.S. states had minimum wage laws near the 7.25 target. Things didn't get worse in those states. The point that seems to be lost, then, is that minimum wage as such doesn't lead to worse employment outcomes, but rather, changes to minimum wage, and presumably, quite a few other factors. I don't have a lot of time, but consider that if profits to shareholders remained constant across all industries, costs were raised a little behind wages (as is normal), and wages were raised in proportion to gross revenues, there wouldn't be any problem. The problem occurs because we don't control everything that needs to be controlled in order to have a good economy.

    It really should be a no-brainer to have a minimum wage; anyone who looks at labor conditions before the reforms of the 20's and 30's should learn this lesson. The complaint from those who oppose minimum wage hikes is really that because the wealthy have become accustomed to ever greater shares of wealth, minimum wage increases lead to lower employment levels. An almost exact analogy occurs when someone is on the road to becoming obese: because the person is becoming accustomed to consume ever more calories, any increase in exercise will lead them to eat still more. The ridiculousness of such an argument against exercise should be obvious, but it's more or less just what opponents of minimum wage increases are really saying.
    Well said. For some reason, the like option is down.
    Quote Originally Posted by calamity View Post
    Reports indicate that everyone knew he was hauling a bunch of guns up there. But, since you brought it up, there's something which should be illegal: guns that breakdown.

  6. #96
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    Minimum Wage Hikes Reduced Employment of Low-Skilled Workers

    Anyone who looks at the fact that over 97 percent of all employees make more than the federal minimum wage should see that there is no reasonable basis for claims that minimum wage is all that keeps everyone from working for slave wages.
    You can't reason anyone out of a position they didn't reason themselves into in the first place.

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