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

  1. #51
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    Re: Minimum Wage Hikes Reduced Employment of Low-Skilled Workers

    Quote Originally Posted by cpwill View Post
    Yes, mostly due to their inputs, as I pointed out.



    I sure eat fewer apples. When we moved to Okinawa the fruit bill shot through the roof and you know what we did? We reduced our fruit diet. To answer his point, though, if you can hire multiple low skill workers, or buy some machines and one or two medium-low skill workers, then which path you choose will depend upon your relative return for each.



    You have lots of options, particularly over time.



    Ah yes. That is why none of (for example) Krispy Kreme's donut-making processes are automated. You have to have a person to stand there and flip those donuts, doncha know.



    This is where I stopped reading. Of course you can replace a cashier with a machine. Has this man not been in a store that features a self-checkout machine? Do you know when they started incorporating that technology? Right after the last time we raised the minimum wage.




    The jobs that you can't replace with machines and that you can't offshore are typically ones whose value-added comes from both knowledge and physical access. So, for example, you can out-source analysis of X-Rays (it only requires knowledge), you can automate a cashier (you require only physical access) but you cannot outsource or automate an electrician (he requires both knowledge and physical access).


    Skimming through the rest, he also buys into the Spending>Saving fallacy (there is no such thing as time, apparently) as well as "Businesses make it back through increased business" fallacy (you cannot get back more of what you put out when you are guaranteed to lose portions of it). This man would be wrecked if he tried this argument on this site.
    We are obviously not going to agree. However, I would point out that a low skilled worker will be replaced with a machine if a company can do so regardless of whether the minimum wage is raised or not. Menial jobs are always going to be automated when possible and it has nothing to do with having a minimum wage.
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    Re: Minimum Wage Hikes Reduced Employment of Low-Skilled Workers

    Quote Originally Posted by Redress View Post
    No, that is not what they said.
    Please highlight for me all of the tradeoffs that they think will occur. Because what I see basically boils down to:

    Quote Originally Posted by SouthernDemocrat
    Raising the federal minimum wage from its current low level would have little if any effect on jobs and employment, while dramatically helping those who labor in these jobs.
    Where do you find the discussion of the trade-offs and negative externalities there?

    Heck. PoweRob thought demand for low-skill workers would go up.



    It's free-lunchism. That's why we make fun of it by suggesting that we just increase the minimum wage to $100 an hour. Because outside of pointing out that it is a reductio absurdum, there isn't an answer for it within the logic presented. If demand for labor is unconnected to price (if it is perfectly inelastic), and if you can trust the increased spending to allow the companies to make back the increased costs, then why not?


    If you want to argue that demand for labor is relatively inelastic under certain conditions, and argue that therefore the reduction in demand would be small, then we can talk about that. But I don't see anyone admitting that they are willing to screw over the most vulnerable in our society simply because there are relatively few of them among our low-income quintile.

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

    Quote Originally Posted by SouthernDemocrat View Post
    We are obviously not going to agree. However, I would point out that a low skilled worker will be replaced with a machine if a company can do so regardless of whether the minimum wage is raised or not.
    maybe. I mean, it's not like there is some kind of large, un/semi-registered, low-skill, low-wage workforce out there with whom our low-skill citizens have to compete for jobs, but who don't come along with federal mandates or taxes...

    Menial jobs are always going to be automated when possible and it has nothing to do with having a minimum wage.
    That is incorrect. As costs for labor rise you create greater incentive for automation, expanding or accelerating it's space. MW increases therefore either accelerate or create demand for automation.

    However, if you are willing to acknowledge that MW increases do indeed cost poor people their jobs, and are shifting now to a position of "but those jobs might have been lost in a few years anyway", I am more than happy to shift to that point of discussion.

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

    Quote Originally Posted by Fruityfact View Post
    I don't know if it's an accurate of thinking of this situation, but I see it as forced acceleration of the velocity of money(as long as the increase is relatively small). In this case, yes there will be small job losses, and slight inflation(poor people still would have more relative purchasing power than before), yet as a result of the increase in the velocity of money, some of those lost jobs, would end up coming back.
    Inflation hasn't been held to lead inexorably to employment since the 70s. That's why we have New Keynesianism.

    However, it's worth pointing out that in this scenario you haven't increased anyones wages in real terms, you've merely thrown some people out of work.

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

    Quote Originally Posted by cpwill View Post
    Where do you find the discussion of the trade-offs and negative externalities there?

    Heck. PoweRob thought demand for low-skill workers would go up.



    It's free-lunchism. That's why we make fun of it by suggesting that we just increase the minimum wage to $100 an hour. Because outside of pointing out that it is a reductio absurdum, there isn't an answer for it within the logic presented. If demand for labor is unconnected to price (if it is perfectly inelastic), and if you can trust the increased spending to allow the companies to make back the increased costs, then why not?


    If you want to argue that demand for labor is relatively inelastic under certain conditions, and argue that therefore the reduction in demand would be small, then we can talk about that. But I don't see anyone admitting that they are willing to screw over the most vulnerable in our society simply because there are relatively few of them among our low-income quintile.
    And once again, find a correlation between the small increases we have had in the minimum wage over the course of the last 70 years, and any reductions in job creation for low skilled workers. I mean for crying out loud, when in the last 3 decades has they ever been a point when a minimum wage job could not be easily obtained? During economic downturns, they are about the only jobs still available. During periods of solid economic growth, many minimum wage jobs go unfilled because better opportunities exist.

    Some of your arguments you have presented thus far are contradictory. For example, when its pointed out that the minimum wage was increased in the 90s yet the poverty rate dropped to record low levels, you respond with "yea because of welfare reform". Well if that is the case, then welfare reform would have had to result in lots of unskilled people entering the workforce and then getting jobs that you argue the minimum wage would have reduced the creation of.

    Moreover, just because an increase in the minimum wage from say 6 dollars to 7 dollars an hour would not be detrimental to job creation does not mean the same would be true if you increased the minimum wage to 30 dollars an hour. Such an comparison is absurd.

    Finally, earlier you mention the price of apples and how when they are expensive you don't buy them. Yes, because apples are a luxury. However, lets say gas is $2.00 a gallon and it then goes up to $5.00 a gallon. Most likely you will drive less and combine trips to save money right? However, that does not mean that you will change anything about your driving habits if gas is $2.00 a gallon and then goes up to $2.10 a gallon. Similarly, if it is $2.00 a gallon and goes down to 20 cents a gallon you might go out and get a big gas guzzler, but that doesn't mean that if gas is $2.00 a gallon and drops to $1.95 a gallon, you will all of a sudden trade your CRV in for a Tahoe. See how that works? The minimum wage works much the same and that is why economists are all over the place with it. An economists opinion on the minimum wage has much more to do with their personal ideology than it does with empirical evidence.

    We could have what amounts to slave labor wages for pennies an hour and all sorts of low wage jobs would be created. We could bump up the minimum wage to 30 dollars an hour and all sorts of low skilled jobs would be eliminated, but neither of those propositions represent any real world scenario in an advanced economy.
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    Re: Minimum Wage Hikes Reduced Employment of Low-Skilled Workers

    Quote Originally Posted by DA60 View Post

    But remember, there is ZERO increase in productivity...so these products/services are no better...just more expensive. But since foreign countries that import those goods into America had no such increase in pay, then that instantly makes American-made products even less competitive with imports then they already were. That hurts sales. And that causes layoffs at those American manufacturers. And probably causes increased hiring at foreign manufacturers that import to America.
    I like this.
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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.
    Training new employees is a very large expense too tho. So for now, it probably came out even. But long term? Your company may have to increase prices. Just a thought.
    Quote Originally Posted by Bucky View Post
    I have felt pain when I was in the womb. So when you say they are incapable of feeling pain, that is based on junk science.
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    A murderer putting a bullet through someone's brain is a medical procedure too.

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

    Quote Originally Posted by cpwill View Post
    Please highlight for me all of the tradeoffs that they think will occur. Because what I see basically boils down to:



    Where do you find the discussion of the trade-offs and negative externalities there?

    Heck. PoweRob thought demand for low-skill workers would go up.



    It's free-lunchism. That's why we make fun of it by suggesting that we just increase the minimum wage to $100 an hour. Because outside of pointing out that it is a reductio absurdum, there isn't an answer for it within the logic presented. If demand for labor is unconnected to price (if it is perfectly inelastic), and if you can trust the increased spending to allow the companies to make back the increased costs, then why not?


    If you want to argue that demand for labor is relatively inelastic under certain conditions, and argue that therefore the reduction in demand would be small, then we can talk about that. But I don't see anyone admitting that they are willing to screw over the most vulnerable in our society simply because there are relatively few of them among our low-income quintile.
    OK, here, let me highlight a small bit of what SD said in your quote of him: "little if any effect on jobs and employment". He is acknowledging that there could be an effect. That is not saying there is no tradeoff.

    Acording to the CBO, it is possible that a minimum wage job could increase employment. The report is linked in this thread. It is not sure, but is within the range of most likely outcomes for a raise to 9 an hour.

    Note that focusing on the positive is not denying the negative. Just as, if pressed, I am sure you would have to admit that many people would see a standard of living increase with a minimum wage hike, that is not what you focus on, those who support a minimum wage hike focus on the positive and not the negative.
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    Re: Minimum Wage Hikes Reduced Employment of Low-Skilled Workers

    Quote Originally Posted by DA60 View Post
    You do not hire people just on need. If that was the case, then pay would be irrelevant.
    I dont understand that statement. Can you please explain it further?
    Quote Originally Posted by Bucky View Post
    I have felt pain when I was in the womb. So when you say they are incapable of feeling pain, that is based on junk science.
    Quote Originally Posted by applejuicefool View Post
    A murderer putting a bullet through someone's brain is a medical procedure too.

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

    Quote Originally Posted by cpwill View Post
    However, it's worth pointing out that in this scenario you haven't increased anyones wages in real terms, you've merely thrown some people out of work.
    How so?
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