The Case to Delay the Minimum Wage Hike

[Debo]

Delay the Minimum-Wage Hike

A recession is the worst time to raise the cost of low-skilled employment.

By DAVID NEUMARK (http://online.wsj.com/search/search_center.html?KEYWORDS=DAVID+NEUMARK&ARTICLESEARCHQUERY_PARSER=bylineAND)

Despite severe economic difficulties confronting businesses, and soaring unemployment among youths and minorities, the federal minimum wage is slated to increase to $7.25 in July from $6.55 today. This will be the final step of a three-step increase enacted in the spring 2007, when the unemployment rate was 4.5%.


Based on 20 years of research, I doubt there is ever a goodtime to raise the minimum wage. However, with the aggregate unemployment rate at 9.4%, the teen unemployment rate exceeding 22%, and the unemployment rate for black teens nearing 40%, next month's increase seems like the worst timing possible.
Despite a few exceptions that are tirelessly (and selectively) cited by advocates of a higher minimum wage, the bulk of the evidence -- from scores of studies, using data mainly from the U.S. but also from many other countries -- clearly shows that minimum wages reduceemployment of young, low-skilled people. The best estimates from studies since the early 1990s suggest that the 11% minimum wage increase scheduled for this summer will lead to the loss of an additional 300,000 jobs among teens and young adults. This is on top of the continuing job losses the recession is likely to throw our way.

The reduction in jobs for youths might be an acceptable price to pay if a higher minimum wage delivered other important benefits. Many people believe, for instance, that it helps low-income families. Here, too, the evidence is discouraging. There is no research supporting the claim that minimum wages reduce the proportion of families living in poverty. Research I've done with William Wascher of the Federal Reserve Board and Mark Schweitzer of the Cleveland Fed indicates that minimum wages increase poverty.

How can this be? Because the relationship between being a low-wage worker and living in a poor family is remarkably weak. Many low-wage teenagers and young adults are in higher-income families, and many poor families have no workers.

According to recent data from a study by Richard Burkhauser and Joseph Sabia, 34% of minimum-wage workers were in families with incomes exceeding three times the poverty line ($22,050 for a family of four) -- roughly the top half of the income distribution. Only 17% were in poor families.

In addition, when deciding which low-wage worker to retain following a minimum wage increase, employers may opt for a teenager, who may have high potential, over an adult who, because he still earns a low wage, likely has much lower potential. Thus, the job-destroying effects of minimum wages fall particularly hard on low-skilled adults in poor families.
There is also evidence that the short-term consequences of minimum wages have long-term effects. The principal sources of an individual's higher earnings are more schooling and the accumulation of experience and skills in the labor market. Unfortunately, increased minimum wages induce some teenagers to drop out of high school and take a job. Moreover, these dropouts take jobs away from the even lower-skilled teenagers who had dropped out earlier. With fewer opportunities to acquire labor-market experience and skills, these teenagers face lower wages as adults.

The accumulated evidence undermines the case for minimum wages even in the best of times. I recognize that there is continuing debate about some of the effects of minimum wages, and that strong public support for higher minimums -- regardless of the evidence -- will likely lead to future increases.

But let's put aside the broader debate and focus on the narrower question: Should we raise the minimum wage in the worst of times? When so many people -- especially the young -- are struggling to find a toe hold in the labor market, does it really make sense to make it harder for employers to hire them?

Minimum wages, like most public policies, confront us with trade-offs. An employed, low-skilled worker who keeps his job earns a slightly higher wage. But a worker who loses his job, or a labor-market entrant or unemployed worker who cannot find a new job, pays a much higher cost. Given present economic conditions, the imperative should be to create and enhance job opportunities.

I do not expect President Obama or congressional Democrats to give up their long-held support for a higher minimum wage. However, they should delay the increase in the minimum wage scheduled for this summer.


Mr. Neumark is professor of economics at the University of California, Irvine, and the author, with William Wascher, of "Minimum Wages" (MIT Press, 2008).


http://online.wsj.com/article/SB124476823767508619.html

[Hanover Fist]

Minimum wage is a retarded concept anyway.

[Debo]

Minimum wage is a retarded concept anyway.

Of course it is. Just wait until they implement maximum wage caps.

[Hanover Fist]

Of course it is. Just wait until they implement maximum wage caps.

I'm not in favor of either, but I would much rather see a restriction on maximum wages (not a cap, but more of a comparative limit i.e. no more than xxx% of the lowest paid employee., and they must be performance based) than a minimum wage. Minimum wage hurts everyone far more than it possibly helps.

[Phil Theehor]

I'm not in favor of either, but I would much rather see a restriction on maximum wages (not a cap, but more of a comparative limit i.e. no more than xxx% of the lowest paid employee., and they must be performance based) than a minimum wage. Minimum wage hurts everyone far more than it possibly helps.

Bad idea. You'd kill McDonalds, Wal-Mart, et al, in the long run. Companies that succeed generally do so by hiring and retaining the best management. If you roll-out an earnings cap that's relative to the average worker's earnings, you'll drive talent away from businesses where the little guy earns $10/hr (like retail, foodservice) to businesses where the little guy earns $100,000/yr (law firms, professional services). We certainly don't need any more consultants or lawyers.

[Phil Theehor]

Oh, one point on the topic:

Raising minimum wage hurts the people you are trying to help by stripping jobs from the market.

[Genius]

I'm all for killing McDonald's and Wal-Mart.

And since I've been on salary, I care a lot fucking less about the minimum wage. KEEP THAT SHIT DOWN.

[Phil Theehor]

I'm all for killing McDonald's and Wal-Mart.


Bite your tongue. Wal-Mart and McD's are monuments to American enterprise. Ray Kroc and Sam Walton belong on Mt. Rushmore.

[Infotainment]

The minimum wage in Mass is $8.00 an hour, this shit doesn't effect us. Nonetheless, here's my thought on it; If you don't push it up and people start falling behind the poverty line (despite having jobs) they are going to come with their hands out to the government looking to get on welfare programs. Either way you go you are screwed.

[heelsguy]

Bite your tongue. Wal-Mart and McD's are monuments to American enterprise. Ray Kroc and Sam Walton belong on Mt. Rushmore.

you may or may not be kidding, but I think they at least deserve a place in the entreprenurial hall of fame.

Minimum wage if a horrible concept. It is bullshit to think that one company can keep an hourly employee from leaving if they are well-below the market wage for that skill-set in that area.

[Debo]

The minimum wage in Mass is $8.00 an hour, this shit doesn't effect us. Nonetheless, here's my thought on it; If you don't push it up and people start falling behind the poverty line (despite having jobs) they are going to come with their hands out to the government looking to get on welfare programs. Either way you go you are screwed.

Actually it does. The entire NE part of the country has been losing residents to the South and the Sun-Belt for decades. Why? Mostly because it is cheaper to live and do business in the South and in the Sun-Belt.

So your high taxes, high minimum wage laws and excessive regulations actually cost you a whole lot in forgone business activity and consumer spending (Plus taxes from both groups).

[Stax]

you may or may not be kidding, but I think they at least deserve a place in the entreprenurial hall of fame.

Minimum wage if a horrible concept. It is bullshit to think that one company can keep an hourly employee from leaving if they are well-below the market wage for that skill-set in that area.

It provides a floor from which to negotiate. The whole point of low skill labor is that it is basically immediately replaceable, particularly in high unemployment conditions. A slight increase in the minimum wage might trim a few jobs on the margins (although honestly if a few more dollars an hour kills your profit margins something more fundamental is wrong with your company, and that 300,000 figure the guy predicts is just stupid) but the existence of the minimum wage ensures those same companies can't say "You'll fry this burger for $3 an hour or we'll go get one of a dozen other people begging for work to do it."

[Debo]

It provides a floor from which to negotiate. The whole point of low skill labor is that it is basically immediately replaceable, particularly in high unemployment conditions. A slight increase in the minimum wage might trim a few jobs on the margins (although honestly if a few more dollars an hour kills your profit margins something more fundamental is wrong with your company, and that 300,000 figure the guy predicts is just stupid) but the existence of the minimum wage ensures those same companies can't say "You'll fry this burger for $3 an hour or we'll go get one of a dozen other people begging for work to do it."

Fail.

Competition on the low end of the labor force is fierce. There are multiple options for lower skilled employees. If McDonalds threatens to pay you $3 an hour, you can go bag groceries at Publix for $6 an hour. Or you can get a job at Home Depot, Wal-Mart, or some other company.

I love how you dismiss 20 years of research without any evidence to prove his statement wrong. Well done.

[Stax]

Fail.

Competition on the low end of the labor force is fierce. There are multiple options for lower skilled employees. If McDonalds threatens to pay you $3 an hour, you can go bag groceries at Publix for $6 an hour. Or you can get a job at Home Depot, Wal-Mart, or some other company.

I love how you dismiss 20 years of research without any evidence to prove his statement wrong. Well done.

300,000 is a laughably gigantic figure. And yes, you can do that when there are jobs, but given unemployment rates there clearly aren't. That's the reason these policies arose from the Great Depression, when there's a massive group of people all simultaneously looking for work that favors companies, not those individuals all competing against one another for already limited spots.

[Debo]

300,000 is a laughably gigantic figure. And yes, you can do that when there are jobs, but given unemployment rates there clearly aren't. That's the reason these policies arose from the Great Depression, when there's a massive group of people all simultaneously looking for work that favors companies, not those individuals all competing against one another for already limited spots.

300,000 is laughably gigantic based on what? Your research? The Chinese fortune cookie that received with your pork fried rice?

Okay, if I have $1,000 a week to spend on staff and I pay my people $5 an hour, I can afford 200 hours of labor (40 hours for five workers). If $5 suddenly becomes $10 an hour, I can now afford 100 hours of labor a week (40 hours for two workers and 20 for one, with two no longer employed at my company).

So tell me again how artificially setting the minimum wage rate above what the market is willing to pay creates jobs..or even saves them.

For the record, we shouldn't repeat anything that we did during the Great Depression. The first New Deal, which contained all kinds of central planning agencies, was found to be unconstitutional and overturned by the SCOTUS. The second New Deal created SS, which is only marginally underfunded when compared to Medicaid.

For arguments sake, lets say that raising the min. wage doesn't affect the number of workers hired, this cost will still be passed on to us, the consumer, in the form of higher prices. So now, I am paying more for the same service. Fantastic...inflation is good for the soul.

[Infotainment]

Actually it does. The entire NE part of the country has been losing residents to the South and the Sun-Belt for decades. Why? Mostly because it is cheaper to live and do business in the South and in the Sun-Belt.

So your high taxes, high minimum wage laws and excessive regulations actually cost you a whole lot in forgone business activity and consumer spending (Plus taxes from both groups).

I'd like to see some hard data to prove that. There's no way you could prove the population you are talking about move down to the south. First, any population graph you send me is going to be diluted thanks to the birth rates in the south being much higher than in the north. Second, a lot of the so called migrations you are talking about are retirees (most of whom don't work minimum wage jobs). Third, the immigrant population in the South is growing at a much faster clip than in the North. Find me a chart that accounts for all three of these and I'll believe that more minimum wage employees are moving down South.

[fuldstændigamok]

Fail.

Competition on the low end of the labor force is fierce. There are multiple options for lower skilled employees. If McDonalds threatens to pay you $3 an hour, you can go bag groceries at Publix for $6 an hour. Or you can get a job at Home Depot, Wal-Mart, or some other company.

I love how you dismiss 20 years of research without any evidence to prove his statement wrong. Well done.

But that obviously wouldn't shock you to see somebody works for $3/hour, would it? Boy, you're such an ass. Minimum wage is a necessity so assholes like you do have limits and can't profit of peoples perpetually, and especially in time of crisis.

[Debo]

But that obviously wouldn't shock you to see somebody works for $3/hour, would it? Boy, you're such an ass. Minimum wage is a necessity so assholes like you do have limits and can't profit of peoples perpetually, and especially in time of crisis.

A.) Fuck you;
B.) I don't think that anyone would take a job at $3 a hour. It isn't even realistic;
C.) There is competition in the labor market at every level. When there is a shortage of labor, wages rise. When there is a surplus of labor, wages fall. Even a dipshit like you can understand that.
D.) Who do you think makes minimum wage: A 40 year old worker, a guy with a HS diploma, or a 14 year old kid that is still in HS?
E.) You are a fucking child. You can neg me all you want, I don't care. If you want to argue about min. wage, then provide some facts and we can discuss them. Otherwise STFU.

I'd like to see some hard data to prove that. There's no way you could prove the population you are talking about move down to the south. First, any population graph you send me is going to be diluted thanks to the birth rates in the south being much higher than in the north. Second, a lot of the so called migrations you are talking about are retirees (most of whom don't work minimum wage jobs). Third, the immigrant population in the South is growing at a much faster clip than in the North. Find me a chart that accounts for all three of these and I'll believe that more minimum wage employees are moving down South.

Does this work or is the US Census too biased of a source?

From the last paragraph on p.3:

The migration story at this broad geographic level is one of net out-migration from the Northeast and the Midwest and net inmigration to the South.And even more:

Within the West, net inmigration continued to the Mountain division and net out-migration occurred from the Pacific division; in both cases, these trends moderated from the 1990s’ pace. The South continued to have the most net inmigration of any region, due to the continued higher levels of net inmigration to the South Atlantic division.http://www.census.gov/prod/2006pubs/p25-1135.pdf

[Whiffleball]

Look guys what you fail to understand what has been illuminated by Debo's eternal sunshine of the neoliberal mind is that sweatshops aren't the problem, it's when one sweatshop has a monopoly on the market. Thankfully we live in a free society so there is a plethora, a literal smorgasboard of jobs with long hours, unsafe working conditions, no insured leave and low, low pay. Unemployment is never a factor because pretty much any Joe can turn his basement into a shoe factory

Sure you could argue that you need a minimum wage so working class folks can keep up with the cost of living but what you don't understand is that the wealthy are the ones who create prosperity in our country. They are constantly buying the iPhones and the yachts and the HDTVs and the sports cars while those poor goons would only buy food for their children, clothes for their backs and put a roof over your head

Basically, we need to fuck the poor in their collective asses and maximize profits by cutting all corners. Yeah I suppose you could argue that even the dregs of the earth known as the proletariat deserve to have a decent standard of living but I read Hayek once and he said life was a game and any intervention in the free market is a corruption of freedom

I mean Hayek supported Pinochet in Argentina because he preferred a liberal society to an illiberal government. So even though Pinochet was a heartless dictator who slaughtered his own people and is widely considered a war criminnal, because he wasn't a socialist he was a good dude

so fuck the minimum wage and up neoliberal dictators, peace

[Whiffleball]

Joe the meat-packer tried to move through the alley as quietly as possible. Like a Bengali tiger, he stealthily darted from cardboard box to garbage can. Although it was nighttime, the evening afforded no cover, as the moon shone brightly... It was a predator's moon, and he knew that the bankers, the traders and the venture capitalists were roaming the streets.

It had been a month since the brain of Friedrich von Hayek had been brought back to life and elected president in a landslide. The first thing he had done was made it legal to use the aristocratic "von", a privilege extended not to those pure of blood, but to those with incomes over 500,000 dollars a year.

The second thing President von Hayek had done was to abolish the federal government. "No more hand-outs," von Hayek had said in his address to the nation. "You're all on your own. We are turning around on the road to serfdom. There is no U.S. Constitution; only a constitution of liberty. You are all starting from a position of equality and how you thrive in this world is up to your own skills and knowledge. Viel Glück wunsch ich Ihnen."

Unfortunately, some people's starting position was more equal than others. The most successful people in this Randian "utopia" were those who came from wealthy families, who lived in gated communities where looters couldn't go, who attended the most prestigious (and expensive) universities, who could afford the soaring health care prices... Unsurprisingly, no one wanted to insure a poor person these days, ESPECIALLY after it became trendy for the rich to eat the poor.

Who was going to stop them? Originally it had been just a few disturbed thrillseekers who had taken to shooting the homeless. But when they weren't punished, an entire subculture had grown up among the elite to kill with their bare hands any blue collar schmuck they came across. It was supposed to make them feel closer to their animal instincts, their inner ruthlessness... the things that served them so well in at the negotiating table or the boardroom as they climbed the corporate ladder.

Joe thought he heard something up in front of him. He perked his ears up like a feral dog and slunk slowly forward. He couldn't detent anything other than the smell of his own stink and the billowing steam from the gutters ahead.

Just then Debo pounced upon the urban peasant, flying from the shadows with a shrill cry of "ATLAS SHRUGGED!" Joe flailed about as Debo took hold of him by the shoulders, but as Joe hadn't been able to eat in weeks, he was too weak to do anything.

Debo sunk his teeth into Joe's neck. Joe cried out, but his scream stopped as Debo yanked his head back, taking Joe's jugular with it. Blood spurted across the alleyway, painting Debo's face with crimson blotches. Joe fell to his knees, then to his side, collapsing on the asphalt.

"Survival of the fittest," Debo said with a shrug. He reached into his designer Armani suit and produced a steak knife and a fork.

It was time to eat.

[freegood]

Walmart loves the min. wage because their employees make above it. What they lack are benefits (time off/dental/medical/401k) if they aren't full time and the majority of those foot soldiers make less than what their competitors would normally offer.

For the inflation argument (which I didn't see in the article) there's not that many that still work for the national min wage because different states usually have it higher in relation to their cost of living. I think the people who get min wage is around 1.7 million people (http://www.bls.gov/cps/minwage2007.htmx). It would affect those podunk regions though, but those states are getting the most dole proportionately from the government...

One way it's being used now is a baseline for employers and unions to pit entry level employees against other low skilled workers. I'm not as certain to the effects of eliminating min. wage compared to other posters. Immigration and teenage workers generally distort the labor supply in unforseen ways. Who knows if a kid will work just as much or more at 3/hr than they do for 7.75.

I think I had a debate with stax over it in the old forums. If the archive is up, there are different pros and cons for it.

[Whiffleball]

la1ke_h-KRs

[Debo]

Look guys what you fail to understand what has been illuminated by Debo's eternal sunshine of the neoliberal mind is that sweatshops aren't the problem, it's when one sweatshop has a monopoly on the market. Thankfully we live in a free society so there is a plethora, a literal smorgasboard of jobs with long hours, unsafe working conditions, no insured leave and low, low pay. Unemployment is never a factor because pretty much any Joe can turn his basement into a shoe factory

Sure you could argue that you need a minimum wage so working class folks can keep up with the cost of living but what you don't understand is that the wealthy are the ones who create prosperity in our country. They are constantly buying the iPhones and the yachts and the HDTVs and the sports cars while those poor goons would only buy food for their children, clothes for their backs and put a roof over your head

Basically, we need to fuck the poor in their collective asses and maximize profits by cutting all corners. Yeah I suppose you could argue that even the dregs of the earth known as the proletariat deserve to have a decent standard of living but I read Hayek once and he said life was a game and any intervention in the free market is a corruption of freedom

I mean Hayek supported Pinochet in Argentina because he preferred a liberal society to an illiberal government. So even though Pinochet was a heartless dictator who slaughtered his own people and is widely considered a war criminnal, because he wasn't a socialist he was a good dude

so fuck the minimum wage and up neoliberal dictators, peace

I will start off by saying BRavo on the short story below, while not 100% accurate (It was Friedman not Hayek and it was Chile not Argentina. And he didn't support or even talk to Pinochet) I still found it funny.

Businesses compete for workers just like they compete for customers. If they offer inferior products, their consumers are going to shop somewhere else. On the same note, if they offer inferior working conditions or inferior wages, their workers are going to go work somewhere else. You might counter by saying that everyone is going to offer low wages for the most basic of jobs. Then, I will counter that there are only so many unskilled workers (Depending on the labor market. Obviously some markets have greater influxes of immigrants than others) competing for the same job. If Home Depot offers me $3 an hour, Wal-Mart offers me $3.25 and Target, who desperately needs people, offers me $4.25 an hour, I am going to work for Target. This will also force HD and WMT to raise their wages to entice me to work for them.

Your statement about Hayek isn't accurate either. Hayek was very big on the rule of law (Contract law in particular). In order to enforce the rule of law, you need the government. Neither Hayek or Friedman are anarchists. They simply think that the government should perform some basic, core functions for society and the rest should be left to private enterprise.

Below is an interview with Friedman where he talks about Chile. I suggest that you read the entire thing, but this part disproves your claim (Don't worry, most lefties get this wrong).

INTERVIEWER: So you envisaged, therefore, that the free markets ultimately would undermine Pinochet?


MILTON FRIEDMAN: Oh, absolutely. The emphasis of that talk was that free markets would undermine political centralization and political control. And incidentally, I should say that I was not in Chile as a guest of the government. I was in Chile as the guest of a private organization.


INTERVIEWER: Do you think the Chile affair damaged your reputation, or more importantly, made it harder for you to get your ideas across?


MILTON FRIEDMAN: That's a very hard thing to say, because I think it had effects in both directions. It got a lot of publicity. It made a lot of people familiar with the views who would not otherwise have been. On the other hand, in terms of the political side of it, as you realize, most of the intellectual community, the intellectual elite, as it were, were on the side of Allende, not on the side of Pinochet. And so in a sense they regarded me as a traitor for having been willing to talk in Chile. I must say, it's such a wonderful example of a double standard, because I had spent time in Yugoslavia, which was a communist country. I later gave a series of lectures in China. When I came back from communist China, I wrote a letter to the Stanford Daily newspaper in which I said, '"It's curious. I gave exactly the same lectures in China that I gave in Chile. I have had many demonstrations against me for what I said in Chile. Nobody has made any objections to what I said in China. How come?"
http://www.pbs.org/wgbh/commandingheights/shared/minitext/int_miltonfriedman.html#10

And I am not going to spend 30 minutes dissecting the video that you posted.

Oh, and I don't read Ayn Rand.

[Infotainment]

A.) Fuck you;
B.) I don't think that anyone would take a job at $3 a hour. It isn't even realistic;
C.) There is competition in the labor market at every level. When there is a shortage of labor, wages rise. When there is a surplus of labor, wages fall. Even a dipshit like you can understand that.
D.) Who do you think makes minimum wage: A 40 year old worker, a guy with a HS diploma, or a 14 year old kid that is still in HS?
E.) You are a fucking child. You can neg me all you want, I don't care. If you want to argue about min. wage, then provide some facts and we can discuss them. Otherwise STFU.



Does this work or is the US Census too biased of a source?

From the last paragraph on p.3:

And even more:

http://www.census.gov/prod/2006pubs/p25-1135.pdf

They base their findings off broad statistics. Go read my paragraph again. Obviously the census doesn't break out who works minimum wage and who doesn't. But what you are saying is minimum wage employees are moving out of the northeast and into the south/west. What the census is saying is OVERALL there's migration from the northeast to the west/south. It's not saying what gauge of employees are moving. There's a huge difference between broad statistics and segmented statistics.

[tockit]

But that obviously wouldn't shock you to see somebody works for $3/hour, would it? Boy, you're such an ass. Minimum wage is a necessity so assholes like you do have limits and can't profit of peoples perpetually, and especially in time of crisis.
You are an idiot if you believe that.

[tockit]

But that obviously wouldn't shock you to see somebody works for $3/hour, would it? Boy, you're such an ass. Minimum wage is a necessity so assholes like you do have limits and can't profit of peoples perpetually, and especially in time of crisis.
Minimum wage and other socialist programs like it, do not work because they do away with incentives or motivation for advancement.

The vast majority of successful companies pay above minimum wage to attract quality, reliable, and motivated help.

Minimum wage jobs are turnstyle jobs, taken most of the time by teenagers and students, who could care less about the job, and stay with it only long enough to land a better job!

The company suffers, by having to waste time and resources retraining new employees who are green, lack experience and motivation.

Retention is crucial to successful companies!

My best friend owns his own business, and he starts out guys at almost 3 times minimum wage, and still has trouble finding and keeping good help!

Raising the minumum wage does nothing but increase the teenage unemployment rate.

[BIG PIZZLE]

I think the minum wage should be abolished.

[satandole666]

The majority of minimum wage earners are high school students. If you really care how much they get to spend on booze and movies by all means increase the minimum wage.

Otherwise, just about anyone with a high school diploma and half a brain makes more than that already. What is the point?

[Debo]

They base their findings off broad statistics. Go read my paragraph again. Obviously the census doesn't break out who works minimum wage and who doesn't. But what you are saying is minimum wage employees are moving out of the northeast and into the south/west. What the census is saying is OVERALL there's migration from the northeast to the west/south. It's not saying what gauge of employees are moving. There's a huge difference between broad statistics and segmented statistics.

I think that the data that you want is going to be hard to find. The Census does account for immigration and migration. That is the best that I can do. I don't think that I can find a study of the migration of minimum wage workers, but I will look for one tomorrow.

[heelsguy]

just to digress for a moment:

Everyone bitches about Walmart and it's high number of hourly workers and how they do not get benefits unless they are full-time.

so?

What would you expect them to do? pay benefits to someone who only is there 29 hours a week? are you kidding me? you know how expensive the employer portion of health insurance is.

And, yes there are a lot of hourly employees at Walmart versus salaried, but that is the nature of retail in general. Hourly is no longer a dirty word. You could change someone from hourly to a salary of 2,080 hours x 8.00/hour = X, but 15 minutes after the thrill of a guaranteed weekly income passes, the first thing that person thinks is how they are going to be asked to work more than 40 hours a week and get nothing for it.

By having them be hourly, the employer can protect itself from lawsuits if that salaried person was worked more than 40 hours a week during holidays.

[freegood]

The issue is that they work 40+hrs/week without getting benefits.

[Hanover Fist]

The issue is that they work 40+hrs/week without getting benefits.

40 hr a week employees at Walmart get benefits, decent ones too. Way better then the people that work for temp agencies. Around here it is next to impossible to get a job in any of the main employers Dow, SKD, Metaldyne, Foamade, Litex, Hilex without going through a temp agency. Companies are only supposed to use temps for a max of 90 days before letting them go or hiring them full time regular workers. However companies find it easier just to keep temps on for up to 2 years to keep them at a low wage (no raises), no benefits, no vacation or seniority accrual, and since almost every major employer here uses them you can't really leave one to avoid it by going to another.
The temp agencies of course don't push companies to hire the temps either because as long as they are temps they make money for the agency, so the employee gets fucked as the agency and the company they work for are both fucking them over.

[heelsguy]

The issue is that they work 40+hrs/week without getting benefits.


if they work more than 40 than by law they recieve time and 1/2, and if I am not mistaken if they CONSISTENTLY work more than 40 a week, they must be considered full-time and be considered eligible for benefits.. or at least that is how it is in NC

[Debo]

The issue is that they work 40+hrs/week without getting benefits.

No, the issue is that WMT won't let them join a union.

[freegood]

if they work more than 40 than by law they recieve time and 1/2, and if I am not mistaken if they CONSISTENTLY work more than 40 a week, they must be considered full-time and be considered eligible for benefits.. or at least that is how it is in NC

The settled a nasty $640 million class action lawsuit (http://online.wsj.com/article/SB123007820184231721.html) late last year over wages.

My info was outdated. Part time employees do get a benefits plan...they just have to work 2 years to get it. Full time employees earn an avg of $10.82/hr. (http://www.nytimes.com/2009/01/25/business/25walmart.html?pagewanted=3&_r=2&hp)

I guess that's not the type of wage for a family worker. Wish someone would tell the suckers that...maybe give them an econ book about labor supply/demand equilibrium. Yeah, that would solve everything.

[Hanover Fist]

The settled a nasty $640 million class action lawsuit (http://online.wsj.com/article/SB123007820184231721.html) late last year over wages.

My info was outdated. Part time employees do get a benefits plan...they just have to work 2 years to get it. Full time employees earn an avg of $10.82/hr. (http://www.nytimes.com/2009/01/25/business/25walmart.html?pagewanted=3&_r=2&hp)

I guess that's not the type of wage for a family worker. Wish someone would tell the suckers that...maybe give them an econ book about labor supply/demand equilibrium. Yeah, that would solve everything.

$10.82/hr is good around here, most temp places pay between $9-11/hr. Pretty bad when you can make more working at Walmart then working at a factory around here.

[freegood]

Damn depressing. National wage (http://www.ssa.gov/OACT/COLA/AWI.html) is around 40k.

Not saying the Wal-mart avg should be 40k, but at 20k/yr (give or take 2k for benefits), better hope both parents aren't working retail. Not much retraining or education possible after that plus raising kids.

[Hanover Fist]

Damn depressing. National wage (http://www.ssa.gov/OACT/COLA/AWI.html) is around 40k.

Not saying the Wal-mart avg should be 40k, but at 20k/yr (give or take 2k for benefits), better hope both parents aren't working retail. Not much retraining or education possible after that plus raising kids.

Unfortunately the trend for using temp services to staff businesses is growing around here rather than shrinking. More and more companies are going this route to avoid paying benefits and guaranteeing hours/wk. They also don't have to pay unemployment if they fire a worker since the worker is technically an employee of the temp agency. At least Walmart hires workers directly instead of abusing them as temps.
I know a few people that work at both the Walmart Supercenter here and also at the Walmart distribution center (now one of the best paying employers in the county), and they seem to think it's a pretty good place to work compared to other places they've worked.


The funny thing is that back at the first place I worked when I moved here I made $16.25/hr, now that same job would be lucky to pay $13/hr, with much worse benefits. No company match IRA, co-pay health insurance, 1 less week vacation, no COLA raises.

[freegood]

Our country's slowly becoming a shithole.

Maybe a donut with shit filling.

[Morfin]

The Minimum Wage is an artificial support which costs all of us a lot of money. Going back a number of posts about McDonald's being able to tell their workers to "accept $3/hr or we will hire any of a dozen others who'll take it." That is free market capitalism. If these jobs take virtually no skills and McDonald's doesn't need someone with any skills, why should it have to pay $8/hr for a $3/hr job?

Also, don't forget Minimum Wage's evil cousin Prevailing Wage, which costs this country and consumers much more than the minimum wage issue and is basically a union-full-employment plan.

[Okie Medicvet]

It was the cushy unions that demanded too much that fucked things up for industries and jobs that are in dire need of the unions. We need a fast food workers unions and a retail workers union, but the motherufucking auto workers unions soured people on the whole idea.

I think anyone against a minimum wage should be forced to live on it for a year.

[satandole666]

I think anyone against a minimum wage should be forced to live on it for a year.

I bet within a month I could find another job that pays twice as much.

The only people on minimum wage are A) high schoolers and B) people to lazy to better their lives.

Neither of which are my problem, and shouldn't be.

Think of labor as a commodity. It follows the same basic principles of supply and demand as other commodities. When you fuck with the prices of commodities you in turn fuck up the supply and demand.

Here's a wiki about price ceilings and price floors (minimum wage). I haven't read them in detail but they seem to be accurate after a quick breeze through.

http://en.wikipedia.org/wiki/Price_floor

http://en.wikipedia.org/wiki/Price_ceiling

These policies hurt everyone NOT associated with the program. If you aren't on minimum wage, the fact we have one reduces your buying power. If you were in NYC during the price ceiling fiasco you would be waitlisted for an apartment that landlords could not afford to maintain.

[The GWD]

The only people on minimum wage are A) high schoolers and B) people to lazy to better their lives.

A gross generalization, sir.

[satandole666]

Not quite:

Conclusion
Many support raising the minimum wage because they want to help low-income Americans get ahead. But while some minimum wage-earners do live below the poverty line, these workers are far from representative. Only one in five minimum wage-earners lives in a family that earns less than the poverty line. Three-fifths work part-time, and a majority are under 25 years old. Minimum wage-earners’ average family income is almost $50,000 per year. Very few are single parents working full-time to support their families—no more than in the population as a whole. It is not surprising, then, that studies show that higher minimum wages do not reduce poverty rates.[7] (http://www.heritage.org/research/economy/wm1186.cfm#_ftn7) Instead of raising the minimum wage, Congress should look at other ways to aid the working poor that actually focus on providing help to those who need it.


It is a few years old but the trends haven't changed.

http://www.heritage.org/research/economy/wm1186.cfm

If you want something a little less biased, but also a little older, check here:

http://www.cbo.gov/doc.cfm?index=6178&type=0

I found that here:

http://gregmankiw.blogspot.com/2006/06/who-earns-minimum-wage.html

It is just a blog, of course, but the blogger happens to be one of the foremost economists in the US today.

[Debo]

I think anyone against a minimum wage should be forced to live on it for a year.

Fail.

I worked a job for minimum wage for a two and a half years, then I went into my Senior year of high school and I found a better job.

If you are 27 years old and are still making minimum wage, you suck at life and there isn't a law out there that is going to change that.

[Mustard]

Serious.

How hard is it to get a job that doesn't pay the minimum wage? It is $8.40 here in Oregon, and thats supposed to go up. I personally don't like it because it could have the effect of making it difficult for low-skill worker driven business to keep their prices the same and stay price competitive in an evolving market.

[satandole666]

Serious.

How hard is it to get a job that doesn't pay the minimum wage? It is $8.40 here in Oregon, and thats supposed to go up. I personally don't like it because it could have the effect of making it difficult for low-skill worker driven business to keep their prices the same and stay price competitive in an evolving market.

Not only does it effect the margins companies face, but it also removes the wage differentiation between obviously different calibers of work.

When a Wal-Mart greeter is getting paid the same as someone operating machinery or vehicles in an industrial setting something is really fucked up.

[Hanover Fist]

Another hidden fact about the raising of the minimum wage is that many public sectors unions have their wage scale based on a % of minimum wage so that if minimum wage goes up it indexes their wage scales to go up accordingly. I wonder who was lobbying for the minimum wage increase the hardest?

[redsox39]

It was the cushy unions that demanded too much that fucked things up for industries and jobs that are in dire need of the unions. We need a fast food workers unions and a retail workers union, but the motherufucking auto workers unions soured people on the whole idea.

I think anyone against a minimum wage should be forced to live on it for a year.

And I think anyone that is for it should have to pay 17% more for everything they buy.

Seriously, Minnimum wage money, goes to Xbox, Beer, Smokes and Drugs. Maybe some make up and trapper Keepers, and condoms.

[Okie Medicvet]

I was on minimum wage when going to college and raising two kids, and it barely went over the cost of the childcare. It is not just teenagers on minimum wage. And here in Oklahoma, minimum wage is 5.75 an hour..last I heard, anyways.

And it isn't just teenagers that work minimum wage jobs..it is senior citizens, immigrants, and people who take it as a second job as well.

Maybe I would feel different about it if the places that pay minimum wage for the most part didn't treat their employees like shit and then don't give them full time hours if they want them...no more than 30 hrs a week at most fast food joints.

I would be perfectly willing to pay fifty cents more for my big mac if I knew it was going to give a better wage to an employee.

And I repeat, if fast food and retail workers had unions, this wouldn't be an issue with me at all. Most unions are now bloated and do more harm than good, but that doesn't mean that unions aren't needed..it just means they need to get back to doing what they were needed for in the first place.

[redsox39]

I was on minimum wage when going to college and raising two kids, and it barely went over the cost of the childcare. It is not just teenagers on minimum wage. And here in Oklahoma, minimum wage is 5.75 an hour..last I heard, anyways.

And it isn't just teenagers that work minimum wage jobs..it is senior citizens, immigrants, and people who take it as a second job as well.

Maybe I would feel different about it if the places that pay minimum wage for the most part didn't treat their employees like shit and then don't give them full time hours if they want them...no more than 30 hrs a week at most fast food joints.

I would be perfectly willing to pay fifty cents more for my big mac if I knew it was going to give a better wage to an employee.

And I repeat, if fast food and retail workers had unions, this wouldn't be an issue with me at all. Most unions are now bloated and do more harm than good, but that doesn't mean that unions aren't needed..it just means they need to get back to doing what they were needed for in the first place.


Ooh! ooh! Can anyone tell us WHY people (especially adults) on Minimum wage are treated like shit?

I will come up with the first 3 reasons that come to my mind, since I hired them for awhile.

1. They never show up on time.
2. The Young ones smell like weed, the older ones like urine.
3. They usually quit right after you schedule them 40 hours, because that is too much work to actually show up to everyday.

Seriously, people that work for minimum wage, 99% of the time, have cast their own lot in life. The Other 1%? They aren't retarded and they are working the job to cover a bill or 2 inbetween real jobs.

[iolas]

Neal Boortz said it best....

I want you to think for think for a moment of how incompetent and stupid and worthless, how -- that's right, I used those words -- how incompetent, how ignorant, how worthless is an adult that can't earn more than the minimum wage? You have to really, really, really be a pretty pathetic human being to not be able to earn more than the human wage.

[Okie Medicvet]

I just can't see treating people like they are worthless because they flip burgers. But I guess that's just me.

[Hanover Fist]

I just can't see treating people like they are worthless because they flip burgers. But I guess that's just me.

They aren't worthless, they are just worth less financially speaking than a skilled worker and don't deserve to earn that much.

[iolas]

I have not made min wage since my first job when I was 16. It was $5.15/hr then. Every job since, my wages have gone up. I don't even have a degree yet. Adults making minimum wage are pretty much garbage.

[Debo]

I was on minimum wage when going to college and raising two kids, and it barely went over the cost of the childcare. It is not just teenagers on minimum wage. And here in Oklahoma, minimum wage is 5.75 an hour..last I heard, anyways.

And it isn't just teenagers that work minimum wage jobs..it is senior citizens, immigrants, and people who take it as a second job as well.

Maybe I would feel different about it if the places that pay minimum wage for the most part didn't treat their employees like shit and then don't give them full time hours if they want them...no more than 30 hrs a week at most fast food joints.

I would be perfectly willing to pay fifty cents more for my big mac if I knew it was going to give a better wage to an employee.

And I repeat, if fast food and retail workers had unions, this wouldn't be an issue with me at all. Most unions are now bloated and do more harm than good, but that doesn't mean that unions aren't needed..it just means they need to get back to doing what they were needed for in the first place.

I don't even know where to begin...

Just because you want more hours, doesn't mean that a company: A.) Needs you to work more hours or B.) Can afford to pay you to work more hours.

Here is a list of the characteristics of who makes min. wage:
http://www.bls.gov/cps/minwage2007.htm

Min wage is low in OK because the cost of living is low in OK. $45K in OK is good money while $45K is NYC doesn't go very far.

So unions are good as long as they don't act like unions?

[Claydon]

45k in southern california pretty much means you need to be on welfare

[mongo]

same in seattle.

however, i brought this up at school today and a friend said that there was a large number of small business owners who are in the first 2-3 years of their business that pay themselves min. wage. he claimed it accounted for about 7-10% of those that file wages that low. is that even possible?

[Claydon]

Portland is fucking ridiculous.

[freegood]

45k in southern california pretty much means you need to be on welfare

Welfare in California means one latte a day, making payments on an American car and the occasional In N Out a week...