The too-low minimum wage means that the government is left footing the bill for groceries (food stamps), healthcare (medicaid) and other expenses (social services). While raising the minimum wage and pegging it to something like personal consumption or consumer prices, the governments (state and national) should cut back on unemployment insurance to encourage unemployed persons to work these new luxury McJobs. The governments will still have to pay social services to the minimum-wage class, but hopefully not as much. This is a win-win situation, the governments can reduce their budgets and emplyers like Wal-Mart can throw the new minimum wage laws in the face of their would-be-unionizing employees - much like they did with Obamacare.
Brilliant idea guy. Now go start a business. Let me know how labor costs factor into a small start up.
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before the econ 101 graphs take over, it should be noted that the economic debate on this topic is far from closed. Need to post that nice seminal paper--- http://davidcard.berkeley.edu/papers/njmin-aer.pdf I shotgunned this happening though, ever since Alan Krueger was nominated for CEA chairman. (behold his labor economics smiting eyes)
FYI--- the American worker is not being denied a job because productivity has gone down. It's because there's a ******* balance sheet recession of a lifetime. For too long, American workers have had to bear the brunt of Wall Street's failures, and had to beg hat in hand while they have produced more and more. An increase in the minimum wage is fair, and speaks directly to the American value of getting rewarded for the work you put in.
The real value of a minimum wage is not the money one makes from it. The real value of the minimum wage is its ability to motivate anyone making it to get educated/trained in order to leave the crappy job that gives them minimum wage.
Who the hell makes minimum wage???? That's supposed to be for your first job as a Kroger bagger in high school or something. Sorry I'm liberal but if your an adult trying to make a living and your on minimum wage that's your fault. 7.25 sound about right for doing some of the lowest skilled jobs in America.
I haven't 100% verified these inflation adjusted numbers, but they seem to be correct. Yes, the min wage is due for a raise, but it isn't like it is absurdly too low. http://www.infoplease.com/ipa/A0774473.html
I am just taking a stab in the dark at this, but hasn't worker productivity increased because of significant technological advances allow one worker to do a lot more with their time? It would seem that the divergence began with the rise of the computer. In advance of any replies....I'm not trying to be partisan or anything I am just trying to figure out why that divergence exists.
My perspective is that it's the other way around. Those programs like food stamps and medicaid are the ones which should be helping the poor, not something like minimum wage which Orange is more or less correct on in demographics. So, if you want the government to get in the business of helping the poor, you don't bother increasing the minimum wage, you expand those other programs instead.
I generally agree with this senitment...but I think the OP has a point too. Regardless of who's fault it is, having the government pick up the slack via welfare or low-income programs is far from optimal. Of course, arguably whether it's the government or a wage-increase...it's the citizens that end up paying for it. Corporations rule the day.
If only high school kids were making minimum wage, grocery stores, wal-mart, target, fast food joints, etc would only be open from 4 to 10 on weekdays except during the summer and weekends.
no---the technological advance per computers has simply not been anywhere near as exponential as people would assume. It has contributed to many things (notably theories about why income gaps are equitable because of said computers), but if one looks at the trend from the 1950s, productivity growth has more or less followed the same trend. harken back to the days of irrational exuberance and the new economy, with Greenspan reading reports in his bathtub about how---well---nothing has really changed. What hasn't caught up has been the American worker's share of the pie. And that has to do with the atrocious failure of recent administrations to ensure the American dream---to each according to his or her work.
The lowest wage a company pays should be, legally, directly pegged to the profitability of the company and/or the maximum income that the company pays to any of its employees. There should be NO loopholes of any kind in this regard. The ratio of highest pay (and/or profitability) to lowest pay would, of course, be a matter subject to debate. If a company is doing well and making significant profit, it's because of its workers to some degree, and everyone should have a share. If a company is not doing well, then it's because of its workers to some degree, and everyone's pay should reflect that.
