Hike the minimum wage. For politicians trying to show their concern for those on the lower rungs of the economic ladder, it’s a simple solution. It’s catching on again, with several states and municipalities approving local hikes, and a proposal before Congress to hike it by an unprecedented amount, from $7.25 to $10.10 per hour over the next two years.
Unfortunately, this seemingly obvious remedy is also a very bad idea, not only for the economy as a whole, but for the low-wage workers it is supposed to help.
Indeed, studies show that the latest congressional hike would likely eliminate some 300,000 jobs per year and lower our national economic output by more than $40 billion annually. Why? Because raising the cost of labor naturally makes it more expensive to hire, leading cash-strapped employers with no choice but to slow down or freeze hiring.
Those who blithely propose large minimum-wage increases are ignoring a basic economic truth: When you raise the cost of something, you slow down the rate at which people purchase it. They buy less. So an employer who might decide to hire another worker when the cost is relatively low will forgo that expense when it gets too high.
That, in turn, can be bad news for those who already work for that employer. He may have no choice but to work his other employees harder, when he could have taken a chance on an unskilled worker and given that individual a chance to prove himself and to move up.
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24 comments:
Joe if you weren't so greedy you would pay your help a decent wage. You will never be as successfull as me. haha tick tock boy
19 states have proven this theory wrong.
"Studies show that the latest congressional hike would likely eliminate some 300,000 jobs per year and lower our national economic output by more than $40 billion annually."
WHAT STUDY??
"Two-thirds of them get a raise within a year."
WHAT A DIME?
"The same kind that will be in shorter supply if the minimum wage is hiked precipitously."
WHERE WILL THEY GO, ARE YOU GOING TO SHIP THOSE OVERSEAS TO RED CHINA ALSO?
Isn't it odd that this old worthless sap is bashing the very thing that he had in the 60s and 70s? Where jobs had insurance, pensions and the like?
But his idea that his grandchildren don't deserve much of anything-is laughable.
Look at this old fart, and this article is laughable! But you know it would be more laughable if it wasn't so dangerous. As these old morons have strapped the youth with 18 trillion in debt, incredibly high student loans, no job security; I think all these old worthless farts need a good whacking with their hypocrisy.
I am really sick of it.
Thousands of WalMart employees work for minimum wage without any prospect of being promoted or seeing a pay increase. WalMart suppliers in foreign countries often hide the fact that they hire 'sumangali' workers at slave wages while WalMart looks the other way. Yet, Sam Walton's relatives are consistently listed on Forbes magazine's list of the world' wealthiest people. Having to pay employees more wouldn't curb hiring; it would only keep WalMart employees from having to seek government assistance to make ends meet.
McDonald's creatd a website to guide people through the processes for getting government (taxpayer) assistance.
They reap gargantuan profits, and let taxpayers (the McDonald's and WalMart customers) foot the bill for dismally-paid employees, many of whom are so desperate for a job, they humbly accept what their millionaire boss offers them, and then suffer intolerable working conditions that McDonald's and WalMart customers rarely recognize.
It's all about greed........why pay workers a wage that they can live on when workers can go on the taxpayer's dole and corporate profits can skyrocket?
The author highlights the need for the general public to truly understand evidence-based logic. So many statements here have been proven false. The 'raise minimum wage, hurt/help workers' debate is a far cry from a slam dunk on either side. But the prevailing wisdom seems to be that raising mw either has no net impact on job growth or a slight positive affect. Not to mention, businesses don't create jobs; consumer demand does.
After the inflation caused by raising the minimum wage, those same people will be eligible for assistance. Another case of kicking the can down the road.
What is never talked about in the debate over razing the minimum is the fact that virtually ever union contract wage scale is attached to the minimum wage. Politicians raze the the minimum wage through legislation, union employees get a raze without having to renegotiate their union contracts.
its always walmart and McDonalds who are the evil empires and greedy rich people. it is plain and simple, raising the minimum wage eliminates jobs or raises prices, you want the dollar menu then forget about raising the minimum wage. if your whole existence is working in a job that pays minimum wage you have no ambition
Is that all you have Annie? I thought that you were an expect on minimum wage by now....
834 "it is plain and simple" shows you have done little research on this topic.
Annie, since you are incapable of producing new information and you continue to simply repeating the same stats over and over again. But since you like stats so damn much, here you go:
http://www.bls.gov/web/laus/laumstrk.htm
Looks like Maryland and Delaware have lower unemployment rates than Washington. I guess people are still willing to work for $7.25/hour.
http://bber.unm.edu/econ/us-pci.htm
Wow, look at that, Maryland also has a higher personal income over Washington too.
http://www.povertyusa.org/the-state-of-poverty/poverty-map-state/
Yikes, Washington also has a higher poverty level too...imagine that.
I see that you are one of those "I believe everything the liberal media tells me" voters. Anything else you would like to contribute so I can make you look even more ignorant??
9:07,
8:34 has a point. Nothing comes free even though you liberals think that everything is free - Somebody somewhere is going to pay. Whether it be in job loss or higher costs. Perhaps you have done little research on this topic, thus you have no valid rebuttal.
Good point Sand Box John! Union worker contracts aren't written by idiots (although they are perceived as such). They don't state that all union workers are to be paid X amount, they state that all union workers are to be paid X amount OVER MINIMUM WAGE. They will get theirs so that they aren't pushed out of the labor force and so that union workers don't become the new lower cost underpaid. Unions are quite possibly one of the worst things that ever happened to the modern American economy.
914 where do you get I'm a "liberal" from me simply pointing out a clear fact that anyone taking a look at the studies will see that this debate is far from "plain and simple". Comment at 740 clearly summarizes the rebuttal and the statement is backed by facts (huh, can you imagine such a thing) not simply spouting a convenient narrative based on political leanings.
910 seems that MD's income and employment numbers are largely buoyed by gov. employment and associated contracts. You may want to pick a different state to compare.
9:10
As usual you micro manage your data to support your unsupportable theory. I have 19 states, you have nothing.
The most ignorant of you comments was:
"Looks like Maryland and Delaware have lower unemployment rates than Washington. I guess people are still willing to work for $7.25/hour."
Do they have a choice? Apparently not.
You are the same moron that said in another post that only 34,000 work for MW. Which is entirely not true.
From the US Census Bureau:
The poverty rate for;
Wash state is 12.5,
Wicomico county it 21.9%
Maryland is 31.7%
the national average is 14.3%
Wash state does not have a higher poverty level, we do.
Hows that for real facts.
I correct my post.
Poverty levels:
Washington State 10.2% (min wage 9.19)
Vermont 7.6% (min wage 8.60)
Nevada 10.6% (min wage 8.25)
Wicomico County 15% (min wage 7.25)
Wash DC 20.7% (min wage 7.25)
National average 14.3% (min wage 7.25)
I agree as with 10:19's commentary - "MD's income and employment numbers are largely buoyed by gov. employment and associated contracts"
Even more delightful was this headline, that Joe posted.
"16% Raise Recommended For Maryland Legislators Who Would Make $50,000 In 2018"
So people in poverty do not deserve better, but they do?
What is everybody's obsession about how McDonalds and Walmart runs their businesses? Get a different example because you can't generalize the Country as a whole based on two corporations.
And it is of my opinion that somebody flipping burgers or scanning bar codes is not worth more that $7.25/hour.
No one is focusing on McD or Wally, they are prime examples of big corporations that pay poorly and encourage their employees to go on some form of welfare. Which means you are paying for it. These are billion dollar corporations that could easily afford to pay their employees better so that I am not subsidizing their paycheck.
That's the point.
McD has an internal website showing their employees how to get on the gov dole. That I find is appalling.
Funny how folks get their panties in a bunch when the government automates speed limit enforcement. But these same individuals have no problem with the government mandating how much employers are required to compensate their employees.
Dear John, I was gonna purchase some JEWELRY for my wife from your STORE, but after seeing your comment - I changed my mind. Besides your prices are HIGH. MERRY CHRISTMAS, GRINCH.
8:20
Try googling why there even is a minimum wage and you will find some answers.
Maybe if employers did the right thing we wouldn't be here.
Or you could google factory workers conditions in China and see what it would be like if we did not have requirements.
Either one.
Greed brought it on.
Are we not a free market economy?
The market should set the wages; not the government. The government screws up everything they touch--especially with this idiot in office now.
A lot of comments about what employers should be forced to do. How about some of you folks start your own businesses and pay your employees whatever ridiculous wage you like? $25 an hour for menial labor seems like a good start. Instead of running your mouths (keyboards), how about you show the rest of us how it can be done?
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