4 ms·
Precisely this. A small shop in Mobile, Alabama being forced to pay the same minimum wage as some company in Santa Clara County is ridiculous. A rented closet i
by briandear 8y ago
Precisely this. A small shop in Mobile, Alabama being forced to pay the same minimum wage as some company in Santa Clara County is ridiculous. A rented closet in the Bay Area costs more than a house payment in Mobile. Also, the tax burden on $15 in Alabama is far lower than the tax burden on someone in California.
Want to give low wage people an actual pay raise? Cut federal payroll taxes since those affect workers equally as they are percentage based.
A $10 wage in Alabama is far more valuable than a $15 wage in Sunnyvale. And conversely, a $15 minimum in Alabama would be more catastrophic to a business than the same minimum in Seattle.
- fma 8y agoJust a clarification, that "small shop" would have to have over $500,000 in sales in order to be required to abide by minimum wage laws. "For most firms, a threshold of $500,000 in annual dollar volume of business applies to be covered (i.e., the Act does not cover enterprises with less than this amount of business)." I'd also argue that definition of "small shop" $500k threshold should change between California and Alabama. https://webapps.dol.gov/elaws/elg/minwage.htm https://webapps.dol.gov/elaws/elg/minwage.htm
- jyounker 8y agoIf you lower the federal payroll taxes then won't companies correspondingly lower wages for new employees?
- dragonwriter 8y agoNot if they are competing for employees; but, yes, if the labor market for particular forms of labor is a monopsony, you are stuck with the inverse of monopsony rents. Of course, if that's a significant general problem rather than a narrow edge case, the entire idea of market economics is a sad joke.