• This is a political forum that is non-biased/non-partisan and treats every person's position on topics equally. This debate forum is not aligned to any political party. In today's politics, many ideas are split between and even within all the political parties. Often we find ourselves agreeing on one platform but some topics break our mold. We are here to discuss them in a civil political debate. If this is your first visit to our political forums, be sure to check out the RULES. Registering for debate politics is necessary before posting. Register today to participate - it's free!

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

Helix said:
i do support a minimum wage tied to inflation, and the $2.13 an hour tip scam should be made illegal.
Click to expand...
I can't support any policy that violates the person, property, or liberty of my fellow man.
 
American said:
Sanders is a ****ing cheat. His people barely eeking out a living while he sits in his millions dollar mansions.
Click to expand...

The most expensive of his three houses is 575k. Another house, valued at 489k, was a one-bedroom, 2 bathroom house purchased so that he could stay close to where he worked. The last one was 409k, and it's where he and his wife usually live. He also has a mortgage on at least one of the three, which is how he could afford the DC house before his book made him rich. Bernie Sanders Has Three Houses: See Photos of the Latest | Heavy.com

And again, he's paying his workers a living wage + healthcare and benefits, there's just some hiccups in a wage renegotiation with their union.
 
Helix said:
4 ways employers respond to Minimum Wage Laws( Besides Layoff)
Click to expand...
That sequence of words doesn't really mean anything.
 
Beowulf said:
That sequence of words doesn't really mean anything.
Click to expand...

i'll be happy to link you to it again so that you can read it for comprehension if you would like.
 
Helix said:
i'll be happy to link you to it again so that you can read it for comprehension if you would like.
Click to expand...
Feel free to say whatever you like. This is a political forum after all.
 
jaeger19 said:
Well to point out.. Unemployment in 1980 was about 7.5%

And in 2015 it was 5%

And now in 2018 about 4%.

Doesn't seem that minimum wage increases are hurting employment....
Click to expand...

In 1980 we were in the middle of the worse recession to hit the US since the Great Depression of the 1930s. Unemployment would exceed 10% by the end of 1980, long term interest rates reached 18%, and inflation was over 150%. By comparison, the US was coming out of a mild recession in 2015 and by the end of 2016 the recession had ended.

Labor is the biggest cost for any employer, and doubling his labor costs means they are going to have to pass on those costs to the consumer. I hope you enjoy your $50 burger and fries, because that is what you are advocating.
 
TheEconomist said:
Everyone has a preferred political stance and everyone has the same tendency to pursue confirmatory evidence more so than to explore more fully the space of counterargument. But if you insist on a different outlet, the NY Time did opine in this same direction very many moons ago:
The Right Minimum Wage: $0.00 - The New York Times.

This notwithstanding, we have access to their articles on the matter. Given that it was introduced by the OP, it might be worthwhile to comment on the content instead of complaining it comes from the FEE.

If you want to look at papers going in the opposite direction, we have a very famous Card and Krueger paper which doesn't find much impact in the fast-food industry. Card also has a paper published in 1992 concluding similarly. To the credit of the FEE, however, it did raise an important point that is seldom covered: employers can respond in very many ways to a minimum wage hike.
Click to expand...

The federal government has no constitutional authority to be establishing wages, minimum or otherwise. If States want to establish a minimum wage, they have that constitutional authority, but Congress does not.

I was in business for 30 years before retiring, and I never paid minimum wage. I made certain to pay more than five times the federal minimum wage because according to the IRS when you pay more than five times the federal minimum wage you are exempt from having to pay time-and-half for overtime. I didn't pay for holidays, vacation days, sick days, or anything else. Although I did provide access to health insurance, they still had to pay for it. I only paid them for the billable hours they worked. At the time of my retirement the lowest wage I paid was $75/hour.
 
KLATTU said:
Cut Hours Rather Than Workers
Make Employees Work Harder
Cut Other Elements of Remuneration
Hire Fewer People, More Robots

Economists Grace Lordan and David Neumark analyze how changes to the minimum wage from 1980 to 2015 affected low-skill jobs in various sectors of the US economy, focusing particularly on "automatable jobs – jobs in which employers may find it easier to substitute machines for people,” such as packing boxes or operating a sewing machine. They find that across all industries they measured, raising the minimum wage by $1 equates to a decline in "automatable" jobs of 0.43 percent, with manufacturing even harder hit.

They conclude that

groups often ignored in the minimum wage literature are in fact quite vulnerable to employment changes and job loss because of automation following a minimum wage increase.

Minimum wage hikes are bad public policy. Economics, like all social sciences, has difficulty testing its models against data, but even where
we can, the evidence bears this out.

4 Ways Employers Respond to Minimum Wage Laws (Besides Laying Off Workers) - Foundation for Economic Education

Comments?
Click to expand...

A few comments. Nuemark is one of the least ideological personas in applied economics that I have run across in the popular literature. I listened to his interviews and read some of his papers (as well as his book on the Minimum Wage ) and his sober and reasoned approach is to be admired. Anyone assuming he is one of the many axe-grinding motivated economists couldn't be more wrong.

I would only add that there are other indirect effects, beyond immediate employer response. For example, if employers are compelled to pay higher wages than the market then one other option is to hire better and more skilled employees (an effect already noted in one city study). The unskilled or young or part-timers who are not worth the higher wage are pushed out, and he better educated replaces them.

The attraction to work at, for example, 15 dollars an hour is such that it draws employees away from other work that really is worth 15 dollars an hour. The high schooler, part-timer, or poor person is replaced by a better skilled individual that would not normally wash dishes or bus tables - push the wage high enough and its a career.

Another effect is that because marginal costs rise, profits drop, the market changes. For example, diners and waiter serviced restaurants tend to be replaced by fast food franchised outlets that are more labor efficient. Future small business growth is affected by reduced profits and future employment opportunity in these labor dependent businesses shrinks.

Anyway, good find.
 
American said:
Bernie Sanders is cutting his employees' hours to meet an "effective rate" of $15/hr. See how gaming the system works?
Click to expand...

What makes you think that layoffs are going to continue? 'Cause $15 is expensive??"

Well guess what; and for a guy with username like yours, I'm surprised that your not more plugged into your own country.
 
Glitch said:
The federal government has no constitutional authority to be establishing wages, minimum or otherwise. If States want to establish a minimum wage, they have that constitutional authority, but Congress does not.
Click to expand...

Well, they've done it for decades, so....:confused:

I was in business for 30 years before retiring, and I never paid minimum wage. I made certain to pay more than five times the federal minimum wage because according to the IRS when you pay more than five times the federal minimum wage you are exempt from having to pay time-and-half for overtime. I didn't pay for holidays, vacation days, sick days, or anything else. Although I did provide access to health insurance, they still had to pay for it. I only paid them for the billable hours they worked. At the time of my retirement the lowest wage I paid was $75/hour.
Click to expand...

The IRS has nothing at all to do with wage or overtime laws, and none of that sounds correct about overtime and who is exempt and non-exempt, but it's good you could pay a lot more than minimum wage.
 
KLATTU said:
Cut Hours Rather Than Workers
Make Employees Work Harder
Cut Other Elements of Remuneration
Hire Fewer People, More Robots

Economists Grace Lordan and David Neumark analyze how changes to the minimum wage from 1980 to 2015 affected low-skill jobs in various sectors of the US economy, focusing particularly on "automatable jobs – jobs in which employers may find it easier to substitute machines for people,” such as packing boxes or operating a sewing machine. They find that across all industries they measured, raising the minimum wage by $1 equates to a decline in "automatable" jobs of 0.43 percent, with manufacturing even harder hit.

They conclude that

groups often ignored in the minimum wage literature are in fact quite vulnerable to employment changes and job loss because of automation following a minimum wage increase.

Minimum wage hikes are bad public policy. Economics, like all social sciences, has difficulty testing its models against data, but even where
we can, the evidence bears this out.

4 Ways Employers Respond to Minimum Wage Laws (Besides Laying Off Workers) - Foundation for Economic Education

Comments?
Click to expand...

I wish Republicans would be consistent. If you think it's bad, why don't you advocate for NO minimum wage? Have the guts to put out that legislation.
 
jaeger19 said:
Well to point out.. Unemployment in 1980 was about 7.5%

And in 2015 it was 5%

And now in 2018 about 4%.

Doesn't seem that minimum wage increases are hurting employment....
Click to expand...



But there is another striking statistic that you can look at if you go to BLS's latest Characteristics of minimum wage workers, 2017. In 1985, there were just about 3.9 million people in the US working in jobs at the Federal Minimum Wage. Yet, in 2017, that had shrunk to just 547,000. Who is largely affected, easy. It's the youth.

The unemployment rate you cited is largely measuring those demographics who are usually not part of the minimum-wage earners. If you want to use employment information to see the effect that the increase of the minimum wage is, go to the BLS.gov website and look at the labor participation rate of 16-24 year olds who are enrolled in school. This is the demographic that is most commonly found working minimum wage jobs. Since 1985, we have seen about their participation rate go from 45% to 35%.


Why does this matter? Because minimum wage jobs have historically been the starter-set job for American youth. It is through these jobs that basic working skills are developed. With the increase of minimum wage, these jobs have shrunk a to about 1/8th the number that there were in 1985. The long-term implications are a loss of overall American productivity as now too often teenagers are not learning essential work skills until later in life. It also results in a larger issue of parent dependency even after leaving school. Let the market determine market rates.
 
StillServing said:
But there is another striking statistic that you can look at if you go to BLS's latest Characteristics of minimum wage workers, 2017. In 1985, there were just about 3.9 million people in the US working in jobs at the Federal Minimum Wage. Yet, in 2017, that had shrunk to just 547,000. Who is largely affected, easy. It's the youth.

The unemployment rate you cited is largely measuring those demographics who are usually not part of the minimum-wage earners. If you want to use employment information to see the effect that the increase of the minimum wage is, go to the BLS.gov website and look at the labor participation rate of 16-24 year olds who are enrolled in school. This is the demographic that is most commonly found working minimum wage jobs. Since 1985, we have seen about their participation rate go from 45% to 35%.


Why does this matter? Because minimum wage jobs have historically been the starter-set job for American youth. It is through these jobs that basic working skills are developed. With the increase of minimum wage, these jobs have shrunk a to about 1/8th the number that there were in 1985. The long-term implications are a loss of overall American productivity as now too often teenagers are not learning essential work skills until later in life. It also results in a larger issue of parent dependency even after leaving school. Let the market determine market rates.
Click to expand...

Actually it is because there are less and less people willing to work for minimum wage and who can blame them. It is worth less every year. Yes it is a problem.
 
StillServing said:
But there is another striking statistic that you can look at if you go to BLS's latest Characteristics of minimum wage workers, 2017. In 1985, there were just about 3.9 million people in the US working in jobs at the Federal Minimum Wage. Yet, in 2017, that had shrunk to just 547,000. Who is largely affected, easy. It's the youth.
Click to expand...

There are two problems with that. I'll quote from the report: Access Denied

Among those paid by the hour, 542,000 workers earned exactly the prevailing federal minimum wage of $7.25 per hour. About 1.3 million had wages below the federal minimum.
Click to expand...

So the total at OR BELOW min. wage is 1.8 million. And those impacted by the minimum wage go much further up the pay scale. Obviously someone making $7.50/hour isn't AT minimum wage but will see their hourly rate increase with really any increase in the MW. So the relevant population is at least all those between the current minimum and the proposed minimum.

Furthermore, other wages are linked to the MW, either explicitly or not, and so someone making $16 an hour, working with others making $10, will almost surely get a raise if the MW is increased to $15.

The unemployment rate you cited is largely measuring those demographics who are usually not part of the minimum-wage earners. If you want to use employment information to see the effect that the increase of the minimum wage is, go to the BLS.gov website and look at the labor participation rate of 16-24 year olds who are enrolled in school. This is the demographic that is most commonly found working minimum wage jobs. Since 1985, we have seen about their participation rate go from 45% to 35%.

Why does this matter? Because minimum wage jobs have historically been the starter-set job for American youth. It is through these jobs that basic working skills are developed. With the increase of minimum wage, these jobs have shrunk a to about 1/8th the number that there were in 1985. The long-term implications are a loss of overall American productivity as now too often teenagers are not learning essential work skills until later in life. It also results in a larger issue of parent dependency even after leaving school. Let the market determine market rates.
Click to expand...

The problem is participation rates for young workers has shrunk as the minimum wage has gotten effectively lower every year due to inflation for 10 straight years. The last time it was raised was in July 2009. So what we should have seen according to this theory is MW jobs expanding since 2009 as the MW effectively decreased, not the reverse.
 
iguanaman said:
Actually it is because there are less and less people willing to work for minimum wage and who can blame them. It is worth less every year. Yes it is a problem.
Click to expand...

All right. Let's see if I understand your argument here. You are saying that since 1985 we have seen about 3.5 million jobs across the country go empty because people have decided that it just wasn't worth working for minimum wage?

In other words, the demand for workers in these jobs has at least remained constant yet the supply of workers has reduced by eightfold? Yet somehow the economic theory of the effect on wages due to the law of supply and demand does not apply here?
 
jet57 said:
If you can't afford to do business, move elsewhere.
Click to expand...


Many businesses have done just that. The jobs that remain are those that produce profits as a result of increasing the costs to consumers, while the larger profits are produced by the manufacturers abroad.
A while back a friend showed me his new Apple I-phone which had a label stating "Designed in the U.S.A., manufactured in China."
I've not ever seen any data to show the "real" effect of a minimum wage increase.
Prior to an increase, how many persons are earning the minimum wage?
After the increase, how many persons remain employed at the higher minimum wage?
And, how many people have lost employment as a result of the higher minimum wage?
How many people find employment more difficult to find as a result of the increased minimum wage?
Has the increased minimum wage resulted in price increases of needs and wants?
Do those living solely/partially on government assistance find their living costs increased?
 
Oh, so we should do nothing and continue to let companies underpay their workers, treat them like ****. Continue to take all the profits, continue to pollute the enviornment, and hell, get rid of all regulations and just let them do what they want. After all, the right wing is all about greed worship

Gee, how do all those companies function in other countries where they have to pay livable wages
 
KLATTU said:
those numbers are irrelevant. You know better.
Click to expand...

Of course, to conservatives, any facts to their BS ideology is irrelevant. That's why you people do nothing but make fools of yourselves all day
 
CLAX1911 said:
sorry if their labor isn't worth 15 dollars an hour it never will be.

So 15 dollar minimum wage makes it illegal for them to sell their labor for it's worth.

Appeals to emotion not withstanding.

And should you make it a law to pay them more than they are willing to, it means automation outsorcing and layoffs.


Yeah, anybody with a pulse can be a store clerk. That's an entry level job. If you want better pay gain skills. That's what everybody that makes more than minimum wage did.
Click to expand...

Well, you obviously don't remember when store clerk wasn't an entery level job. The guy at the shoe store or the clothing store or the hardware store knew about what they were selling. Knew their customers, etc.

Business just declared it a job not worth paying for and that was that.

Dynamically this was in response to our statusheads coming into competition with statusheads in other countries with vast pools of desperate people.

Our poor status addicts found themselves in a losing position. Too much of the capital they needed to get "ahead" of others trying to do the same thing was hemorrhaging away as wages for greedy American commodities (people).

Something had to he done. So they went after the unions. Hijacked the recession caused by the oil embargo and just pocketed the difference from then going forward. From that time wages have been flat while profits and executive salaries have gone through the roof.

It is this "decoupling" of wages from growth that has led to jobs that used to pay a living no longer doing so. Coupled with manifold increases in the cost of housing, what the ownership class is "willing" to pay has fallen to less than it costs to live. Which is what happens when jobs have been determined to be only worth "x" but the cost of everything else goes up and up. Eventually you become poor while working full time at a job that used to provide a living.

I think its a good thing to remember from time to time that most of us are literally considered commodities to capitalism. To be used and discarded at will. Unless you can climb high enough on the ladder. Then you become an owner who gets to use those commodities. Extracting as much profit from their labor as you can.

So you can climb higher on the ladder.

This status seeking behavior, which was kept in check when we were alpha predator members of extended families, has run rampant since we settled down and started producing our own food. Animal behavior writ large in bloody letters across history.
 
You must log in or register to reply here.
Back
Top Bottom