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Leaked documents show strong business support for raising the minimum wage
- matt_wulfeck 11y agoI'll vote on the minimum wage law increase provided we finally do away with tipping.
- tinalumfoil 11y agoTipping is a cultural aspect, not a legal one. Tipping was written into the law because people were already tipping, not the other way around.
- fucking_tragedy 11y agoAs long as food servers are paid less than minimum wage it is a moral issue as well.
- 1123581321 11y agoServers earn the greater of tipped minimum wage plus tips, or minimum wage. Of course people take serving jobs expecting to earn more than minimum wage, but it's not the same moral issue if they don't.
- tangent128 11y agoIn theory employers are supposed to make up the difference if tips don't meet minimum wage. But it's infamous for being poorly enforced.
- 1123581321 11y agoI agree that is a problem. I suspect it's receding as the percentage of restaurant sales paid by credit card increase. People who dine at restaurants that likely commit wage theft might tip for moral reasons, but to me, it makes more sense to boycott those restaurants and communicate to managers and owners the reason why.
- deleted 11y ago[deleted]
- JoBrad 11y agoThey can, yes. But the instability of wages is a bigger issue. You can do amazing one day, and horrible the next. Combined with the fact that we teach next to nothing about financial planning in the US, and the extreme reliance on consumer debt by our economy, tipped workers are more like gamblers.
- 1123581321 11y agoI agree. I would love to see tipping be replaced with a steady wage or salary based on skill, seniority, etc., like most careers have.
- clarkmoody 11y agoIt's only a moral issue if the server is compelled to work for that wage. Slavery is immoral. Entering into a voluntarily wage agreement is not.
- fucking_tragedy 11y agoSometimes life compels you to do things that are necessary, but not optimal. I know people that feed their family on tips. Workers being paid substantially less than their labor is worth by their employer is wrong.
- xufi 11y agoI actually do wonder. How is tipping in Europe v.s the US where we always do %10 or so
- NamTaf 11y agoSometimes it exists, other times it doesn't. Tipping just about doesn't in Australia, where we pay a reasonable minimum wage ($17.29 per hour for adults in full-time employment). You occasionally find people will tip a taxi driver or bartender, but by and large it's just not done.
- xufi 11y agoInteresting. Some states in the U.S just raised the wage to $14 dollars but nationally it's pretty low
- 3pt14159 11y agoIn Toronto we do 15% to 25%. 10% is really low.
- megablast 11y agoBut you have a fair min wage in Canada, right?
- vlasev 11y agoIt's about 11 CAD.
- Ensorceled 11y agoNot for "service workers". They can be payed below minimum wage because they get tips as supplemental income.
- davidw 11y agoIn Italy, tipping is fairly rare. It's so much easier to just pay what the meal costs and get on with life.
- cypherpunks01 11y agoDo you say that as a consumer, or an employee, or an employer? I am curious about which perspectives support tipping and which don't.
- c0nducktr 11y agoConsumer: Dislikes tipping Employer: Likes tipping Employee: Likes tipping
- zajd 11y agoAsk an employee who works in the kitchen
- InclinedPlane 11y agoPersonally, as a consumer I like tipping. But only because it gives me a chance to pay a higher price than I normally would, and to preferentially support small businesses that I like. I could do that by buying more stuff, but tipping is somewhat easier and more direct. However, overall I think I'd prefer to see the end of tipping culture in America. There are too many downsides to it to justify the upside (which is effectively a kind of market segmentation / consumer surplus capture). For one, a lot of places allow different minimum wages for tipped positions, which is a very bad practice in my opinion and defeats the purpose of tipping. For another, tipping makes harassment (especially sexual harassment) of waitstaff by patrons a lot harder to combat. It also skews the income distribution between the waitstaff and the back of house staff. All of these things are bad verging on extremely bad. And they could be substantially improved by eliminating tipping. So even though I'll miss being able to be generous with a tip when I feel like it, I think it's time for the practice to be put out to pasture.
- boona 11y agoHad liberals (or north-american libertarians) been able to win the battle for words, we would be discussing "making it illegal for low skill workers to get jobs", not "minimum wage".
- deleted 11y ago[deleted]
- js8 11y agoThey did win battle for words! Libertarians call any exchange of work for money, no matter how small, a "job". But normal people, when they want "a job", don't seek to have an economic exchange for miniscule amount of money that cannot pay their bills. That can be called either a "gig" or "slavery", depending on circumstances, but hardly a "job". A "job", in normal speech, is something that can actually economically support you. So what is being outlawed by minimum wage are "jobs" that cannot feed people, which, I am sure you will agree, are simply not worth existing. And in fact I think popularity of libertarianism is half of the cause why minimum wage is still being discussed, because people and businesses who actually know economic stuff support minimum wage, as they understand that flow of money in economic systems starts from the demand. The other half of the cause are possibly some rich people, who are a different type of political actor than businesses.
- RHSeeger 11y ago> So what is being outlawed by minimum wage are "jobs" that cannot feed people, which, I am sure you will agree, are simply not worth existing. I certainly don't agree with that sentiment. There are a lot of people that are working that don't need to support themselves. Between teenagers, college students (who may only need to pay for books, etc), mentally/physically impaired (that are supported by the state but work because it's good to be productive)... there's a place in society for jobs that pay below what you're saying.
- js8 11y agoThen we will agree that we disagree. Let's ignore, for the moment, the big issue here, which is that by far, these jobs are not held only by people who you describe (college students and impaired). I don't think creating an artificial job that cannot actually feed you can make anybody feel better of themselves. In any case, it shouldn't be called "a job", which was my point. In particular, I think college students should study and not be distracted by having side jobs, and disabled people should either enjoy their pension (assuming they live in a civilized country that has that) or have a regular job (in fact, labor laws in my country prescribe positive discrimination for disabled people, even though it is probably economically inefficient).
- joshuaheard 11y agoThat actually makes sense in a perverse way. From the poll, one can see that most business owners would like to pay more wages. Well, they own the business, so they could just raise wages if they wanted to, without a legal minimum wage. Then why don't they? Competition. A business owner won't raise wages because his neighboring business will have lower costs and be more competitive. However, by forcing all business owners to give raises, competitive pressure is lost. Raising the minimum wage still defies economic sense, however, in that it distorts the marketplace and causes job loss.
- smsm42 11y agoIf everybody raises wages, and consequently prices (that is assumed since that's the only way you could have lost competitive edge after raising wages) - then what's the point of it? Of course, employees would be paid more numerically, but they could not buy more with this. Unless, of course, some production would be moved overseas, where prices are not affected by wage raise. So in essence, these people are betting on more goods manufactured out of the country - no doubt decrying "job loss to foreign countries" at the same time.
- cowardlydragon 11y agoUnless of course all large companies are already sitting on large profit margins (they are, either explicit or just structurally sitting on them with bloated management structures), in which case the increased pay will simply help alleviate a demand starved economy, which will increase flow of money / rate of transactions and, guess what, everyone makes more money.
- wallacoloo 11y agoI believe the theory is that the price of goods/services created by high-wage workers would not substantially increase, and thus the minimum-wage workers would be able to achieve a higher quality of life at the cost of slightly degrading that of the high-wage workers (since the price of some of the goods those high-wage workers buy has increased). Minimum wage can be an attempt to fight income inequality. Not that it's necessarily the best approach for that though (as mentioned elsewhere in these comments).
- ThomPete 11y agoMinimum wage is fine but it does not solve the actual problem of technology decreasing the value of each worker in most of those fields. A better solution would be UBI since it actually deals with the issue that MW is claiming to solve (but doesn't)
- dredmorbius 11y agoTechnology, by increasing per-worker productivity, should increase labour value. (Mind: I said "labour value", not "labour compensation". There's a difference.) Technology that decreases value of workers isn't technology, at least in the economic term (Solow) which sees it as an increase in productivity not accounted for by capital or labour directly (the Solow Residual). https://en.m.wikipedia.org/wiki/Solow_residual https://en.m.wikipedia.org/wiki/Solow_residual
- YokoZar 11y agoThere is certainly technology that substitutes many cheap (low-skill) workers for a few individually more expensive ones. The value to the business of the labor would increase, and on average "labor value" would be higher, but it would be different people's labor having more value. At the same time, all else equal this would reduce the relative demand for the low-skilled worker, leading to a fall in the competitive wage they could get. So, yes, "technology" should increase productivity and thus mean "labor value", but individuals can definitely lose out.
- dredmorbius 11y agoNote what you just referenced. You're replacing low cost labour for high cost labour, but increasing the value of that labour. Cost is what you give up for something. Value is what you get for it. Price is what you pay on the market. They're three distinct concepts. Much economic confusion results from it. (And yes, there are some who describe "value" as "market value", which I refer to as price. See though "economic value.)
- ThomPete 11y ago
- emblem21 11y agoI support $40 an hour minimum wage. This is because I also support robots doing all jobs.
- pdkl95 11y agoOf course. Demand is necessary for business. If lots of people are barely scrapping by (which has been true for a long time), only a tiny handful of businesses will make any money. The 80% supporting an increase are just stating the obvious: you need demand if you want to sell anything.
- rebootthesystem 11y agoAs always, lots of opinion from people who have never taken a risk, used their own money, launched a non-trivial business, ran it for a decade and lived the reality of a competitive imternational marketplace while trying to survive govenrment fucking shit up all around you. Nah, forcing a 50% hike in minimum wage will only have one effect. And anyone who has operated a non-trivial business for a while knows what that will be. What was Ross Perot's famous line about a huge sucking sound? Do you non-business folks want me to spell it out? Well, I don't have the time to describe all that will happen. I'll just pick one consequence. This one highhlights the economic tsunami this will be: You only need one, or a handful, of people at minimum wage to destroy jobs and even the very viability of a business. So, you have 50 people earning $15 to $20 per hour today. Maybe you have another ten earning $25 to $50. And you have, say, five, earning minimum wage. In five years your minimum wage folks go to $15 per hour. An incredible 50% raise. The folks making $15 to $20 know this. They don't want to be at minimum wage or thereabouts. Their wages are likely to have to go up. What do we do? One group just got a 50% raise. Do we give everyone a 50% raise? No, let's try $5 per hour. We now go from $15 and $20 to $20 to $25. In other words, 25% to %33% hike in wages for mid-range employees. Of course, those making $25 to $50 now want their cut. Let's give them $5. So, $30 and $55 it becomes. On the aggregate, mid-range employees probably represent the bulk of your labor expenses. Your real costs just went up somewhere around 33%. Can we raise our prices? Probably not. What we now have is a hit in profitability AND a cashflow squeeze. And we know we can't survive them. Well, fuck it! Let's fire the minimum wage earners and problem solved. We only have five of them and they triggered this mess. Will that solve the problem? No. Your employees know about this new scale out there. They don't think it is fair that they earn anywhere close to what a 14 year old kid can get at Del Taco. Well, shit! We didn't solve the problem. Oh, wait a minute. A Chinese competitor who understands the math just lowered their prices by 10%, forcing us to follow suit and causing a further squeeze to our finances. We need to take drastic measures. We need to lay-off enough people to remain viable. We migt even have to shift some of the remaining people to part-time work. The trouble is that we were straining to keep up as it was. We really can't produce enough goods with 25% less man-power. Only one choice remains. We contract to have our goods and services made and performed in China and India. We shrink dow to a management and marketing team in the US, get out of the lease for our 50,000 square foor facilty and move into a 1,500 square foot office space. And there you go: The huge sucking sound you'll hear is that of millions of jobs leaving the US. Thanks everyone! Good job! We are really good at destroying ourselves from the inside. They are laughing their asses off in China right now.
- mikaeluman 11y agoEconomic 101. Minimum wage does nothing except hinder the disadvantaged. But yes, may also be good to get rid of your competition. Useless debate, because people, even engineers, don't think about it economically but only politically. If you believe it works, let's just make it $50 an hour.
- Chinjut 11y agoAs I understand it, there's more to the world than what is often presented in Econ 101.
- cowardlydragon 11y agoAnd economics has EVERYTHING figured out? At least towards an oligarchical fascist police state dystopia with monopoly or cartel control over most "free markets" and can't predict basic things like the housing mortgage crash, overexuberance in tech stocks, and the like. It can't even fucking figure out how to fundamentally avert global disaster or total ecological destruction. It basically can see three months into the future. So I hate to tell you, your supply/demand curves may look second-nature, and the pirates dilemma may let you sleep at night with the current distribution of wealth, but it doesn't represent chaotic, nonlinear, fly-off-the-rails reality.
- ordbajsare 11y agoStop reading Marx.. it will rot your brain.
- dredmorbius 11y agoRead Smith. "A man must always live by his work, and his wages must at least be sufficient to maintain him." https://en.m.wikisource.org/wiki/The_Wealth_of_Nations/Book_I/Chapter_8 https://en.m.wikisource.org/wiki/The_Wealth_of_Nations/Book_... An enterprise which cannot pay the full cost of its inputs isn't an economically viable activity. It's a charity benefiting its owner. More on Smith regards wages: https://www.reddit.com/r/dredmorbius/comments/2311mb/adam_smith_on_living_wage_national_wealth_growth/ https://www.reddit.com/r/dredmorbius/comments/2311mb/adam_sm...
- lumberjack 11y agoIf there is such widespread support why is it that comments on various social media give a completely different perspective when the topic comes up?
- dredmorbius 11y agoSeveral possibilities come to mind. Ignorance. Poor education. Disinformation. Astroturfing.
- JBReefer 11y agoOr people that have a different opinion.
- Aoyagi 11y agoI don't understand this. The federal minimum wage (7.25 USD) in US is higher than Czech average wage (~6.78 USD), yet things generally aren't any cheaper here. Taxing crippling. I thought the minimum wage at its current height is unsustainable, and they want to raise it even more? By the way, what are the "leaked documents" in the title? The public survey and the public research?
- JohnDoe365 11y agoIt's a vicious circle. Increased wages will result in increased consumption and contribute to making the rich richer while flooding the poor with goods with built-in obsolescence. It would be much better to learn living with much less than we do now and teach the one who try to deprive our workforce that they are dependent form us.
- mtgx 11y agoFirst off, most Americans are already in a borderline financial crisis, and you're saying that it's better they stay this way than get more money to "increase consumption"? http://www.cbsnews.com/news/most-americans-cant-handle-a-500-surprise-bill/ http://www.cbsnews.com/news/most-americans-cant-handle-a-500... Obviously if you have more money, you will increase consumption, but the more money you make, there will be diminishing consumption. It's not like people making $30 million a year spend 95% of it at Walmart. The more money you make the more you either invest or save (as a percentage of your income), even if the total consumption increases as well. In other words, having more people with more money is not a "bad thing" for the economy (or their personal lives). Quite the opposite. Second, if there's a stronger middle class, it means the money paid to businesses will be much more distributed. When people have little money, then they can only afford to spend on "necessities", which by default shrinks the market to a handful of business categories, which means only a few will be able to get "richer". It's also likely that only the biggest such businesses will survive thanks to better economies of scale and people's price sensitivity due to the very low incomes, which means there will be higher inequality and less competition in the market. When more people have more money, they buy all sorts of stuff, giving life to all sorts of new businesses and because consumers aren't as price sensitive, competition will be higher as well.
- danieltillett 11y agoNever run a business that relies on paying minimium wage.
- JoBrad 11y agoThis is the real answer. The minimum wage is only an issue because so many companies rely on it to bolster their business model.
- somberi 11y agoJust to widen the context. From New Yorker (1) Walmart and Target earn between three and four cents on the dollar; a typical McDonald’s franchise restaurant earns around six cents on the dollar before taxes, according to an analysis from Janney Capital Markets. In fact, the combined profits of all the major retailers, restaurant chains, and supermarkets in the Fortune 500 are smaller than the profits of Apple alone. Yet Apple employs just seventy-six thousand people, while the retailers, supermarkets, and restaurant chains employ 5.6 million. The grim truth of those numbers is that low wages are a big part of why these companies are able to stay profitable while offering low prices. (1) http://www.newyorker.com/magazine/2013/08/12/the-pay-is-too-damn-low http://www.newyorker.com/magazine/2013/08/12/the-pay-is-too-...
- cowsandmilk 11y ago> Walmart and Target earn between three and four cents on the dollar; a typical McDonald’s franchise restaurant earns around six cents on the dollar before taxes, according to an analysis from Janney Capital Markets. Those numbers say nothing about how many cents on the dollar their retail employees currently cost. A cashier can easily check out thousands of dollars of merchandise an hour. I can virtually guarantee retailers pay more in credit card processing fees than they do for their retail employees. Of course, Target reflects this with their 5% Red Card. And many smaller retailers reflect this by either (a) not taking credit cards or (b) only taking certain cards.
- michaelmrose 11y agoNobody is disputing the idea that prices will rise as wages hopefully you aren't so greedy that you would rather they not make a living wage
- Mikeb85 11y agoRaising minimum wage will boost aggregate demand. What's not to like? It's a consumer economy, not an export economy. You want consumers with money.
- ACStar 11y agoI haven't read all the comments but I think there is a large sector of the workforce being ignored in the discussion. I live in a rural area and most manufacturing jobs here start in the $10/hr range. All the companies starting less than the new minimum will have to increase wages as well. This will include all experienced people who will now want to be earning more because the floor has now risen by x dollars.
- kennethh 11y agoIf one increase the minimum wage the business employing people have 3 choices: 1. Have less profit, but this is not in the business owners interest 2. Increase the prices, this might be possible. This would normally lead to less customers since the cost increased 3. Become more effecient, reduce the number of people employed I would guess mostly and sometimes 2 would be the normal response. Nobody wants to decrease their profit and the profit can not be lower than 0 over time.