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It would be great if someone would make a website where I could adjust the hourly rate of a worker in various businesses and see the result in the cost of commo

It would be great if someone would make a website where I could adjust the hourly rate of a worker in various businesses and see the result in the cost of common items they sell. I wonder if $20/hr barista pay really would cause the price to become unreasonable. At $20/hr it's also possible you could interest some slightly better baristas, slightly faster baristas, and who would have longer retention... Also the prices wouldn't necessarily go up uniformly on everything. Lattes might go up $1 but coffee might only go up $0.25 because it doesn't take as much time for the barista to give it to the customer. This discussion on reddit (https://www.reddit.com/r/barista/comments/2qv2kb/question_how_many_cups_can_a_barista_make_a_day/ https://www.reddit.com/r/barista/comments/2qv2kb/question_ho...) is 1st hand information and says that 2 baristas can make 450 drinks per day in a 7 hour day. That's 225 per barista / 7 hours, 32 drinks per hour. So if the wage increased to $20/hr (from let's say $10/hr), it would increase the price of drinks by $0.31, which I don't think is enough to cause people to massively switch to instant coffee.

ams6110 8y ago
Except they don't make 32 drinks an hour for 7 hours straight. They might do that at the busiest times, but that's likely a minor part of their day. Edit: Labor cost in fast food is typically about 20% and most places would consider that on the high side. Not sure how well that translates to coffee shops, but assuming a 100% increase in cost of labor, prices would go up about 20% to cover that. So a $5 latte becomes $6.
- Retric 8y ago
  32 drinks per hour is a low average that’s already including downtime. “8-4 shift with 2 other baristas on a 6 group synesso hydra, is 986 coffees. That place averaged around 750 a day.” 986 / 3 people / 8 hours = 41 per hour. 750 / 3 people / 8 hours = 31 per hour. If your comparing somone making 20$ per hour vs 10$ per hour that’s 24 to 31 cents a drink. Which is not meaningless but does demonstrate that wages are a low percentage of the cost of a coffee.
  - hn_throwaway_99 8y ago
    I would argue that that average is probably an extreme outlier. For one, a 6 group synesso hydra is an absolute beast of an espresso machine. I'm a "coffee snob", and I can't think of any of the best espresso shops in my city that have a machine near this big or high-end. For comparison, a 2 group hydra retails for $18k. My guess is only the busiest, highest-end shops could support a machine that big.
    - Retric 8y ago
      While true, 3 people just making coffee is also something of an outlier. The average Starbucks sells ~400 cups of coffee a day, but that includes a lot of very low volume locations with less than 3 people.
roenxi 8y ago
Such a website would be really interesting and would probably rise some interesting questions and answers and may well be a good idea. However, being a fierce capitalist, I want to draw out the problems this line of thinking has if it is carried to its logical conclusions. 1) At some point people will stop buying coffee due to its price. Where is that point and how do we find it if it is not the one determined by the cafes and customers as is currently the case? If we can double wages and prices are still 'reasonable', why can't we double them again and again? When do we know we've hit 'reasonable'? Who controls what that word means? 2) You've divided a large number (double wages) by a large number (drinks/hr) and come up with a small number. The maths is fine, but the maths is obscuring the fact that the changes are large. I dunno what you are being charged for a coffee, but $0.31 is ~3% of $10 and that is quite large. Anyone who is on a disciplined budget would buy less coffee if coffee is coming out of their discretionary spending. The argument here might be that coffee is a tiny percent of someone's expenses, but the issue is that the 'only $0.31' thinking doesn't scale. If a bunch of things rise in price by 3% in real terms, consumers with no savings (ie, most consumers) DO have to cut back on something with mathematical certainty.
- rossdavidh 8y ago
  Yes, and whatever it is that they cut back on, it is probably no more worthy than more wages going to people in the bottom portion of the income distribution.
- epicureanideal 8y ago
  But the wages not being spent by others (because they're paid to the barista) would then be spent by the barista, which then means other businesses could raise their prices a bit... The barista making $10 more per hour can go out and buy dozens of coffees of their own, or meals out at restaurants, or movies... It would keep the lower level of the economy moving.
  - roenxi 8y ago
    How can money get to the barista if it is "not being spent by others"? All the barista's income is coming from wages spent by consumers on coffee. The point is, gp said "it isn't unreasonable" with the implication that nobody would notice (eg, "enough to cause people to massively switch to instant coffee"). That isn't a safe position - it is likely consumers of coffee will have to cut back on something. They would notice. On your specific point that you think allocating more resources to baristas will help the economy - why not allocate the baristas to doing something more useful, where the market rate for their time is higher than $10? Allocating more to baristas is a lot of things, but it is not an evidence based strategy for increasing the general prosperity. What is it that these baristas lack? Maybe they should be trained to produce that thing, instead of getting handouts or fighting with their employers?

ams6110 8y ago

Except they don't make 32 drinks an hour for 7 hours straight. They might do that at the busiest times, but that's likely a minor part of their day. Edit: Labor cost in fast food is typically about 20% and most places would consider that on the high side. Not sure how well that translates to coffee shops, but assuming a 100% increase in cost of labor, prices would go up about 20% to cover that. So a $5 latte becomes $6.

Retric 8y ago
32 drinks per hour is a low average that’s already including downtime. “8-4 shift with 2 other baristas on a 6 group synesso hydra, is 986 coffees. That place averaged around 750 a day.” 986 / 3 people / 8 hours = 41 per hour. 750 / 3 people / 8 hours = 31 per hour. If your comparing somone making 20$ per hour vs 10$ per hour that’s 24 to 31 cents a drink. Which is not meaningless but does demonstrate that wages are a low percentage of the cost of a coffee.
- hn_throwaway_99 8y ago
  I would argue that that average is probably an extreme outlier. For one, a 6 group synesso hydra is an absolute beast of an espresso machine. I'm a "coffee snob", and I can't think of any of the best espresso shops in my city that have a machine near this big or high-end. For comparison, a 2 group hydra retails for $18k. My guess is only the busiest, highest-end shops could support a machine that big.
  - Retric 8y ago
    While true, 3 people just making coffee is also something of an outlier. The average Starbucks sells ~400 cups of coffee a day, but that includes a lot of very low volume locations with less than 3 people.

roenxi 8y ago

Such a website would be really interesting and would probably rise some interesting questions and answers and may well be a good idea. However, being a fierce capitalist, I want to draw out the problems this line of thinking has if it is carried to its logical conclusions. 1) At some point people will stop buying coffee due to its price. Where is that point and how do we find it if it is not the one determined by the cafes and customers as is currently the case? If we can double wages and prices are still 'reasonable', why can't we double them again and again? When do we know we've hit 'reasonable'? Who controls what that word means? 2) You've divided a large number (double wages) by a large number (drinks/hr) and come up with a small number. The maths is fine, but the maths is obscuring the fact that the changes are large. I dunno what you are being charged for a coffee, but $0.31 is ~3% of $10 and that is quite large. Anyone who is on a disciplined budget would buy less coffee if coffee is coming out of their discretionary spending. The argument here might be that coffee is a tiny percent of someone's expenses, but the issue is that the 'only $0.31' thinking doesn't scale. If a bunch of things rise in price by 3% in real terms, consumers with no savings (ie, most consumers) DO have to cut back on something with mathematical certainty.

rossdavidh 8y ago
Yes, and whatever it is that they cut back on, it is probably no more worthy than more wages going to people in the bottom portion of the income distribution.
epicureanideal 8y ago
But the wages not being spent by others (because they're paid to the barista) would then be spent by the barista, which then means other businesses could raise their prices a bit... The barista making $10 more per hour can go out and buy dozens of coffees of their own, or meals out at restaurants, or movies... It would keep the lower level of the economy moving.
- roenxi 8y ago
  How can money get to the barista if it is "not being spent by others"? All the barista's income is coming from wages spent by consumers on coffee. The point is, gp said "it isn't unreasonable" with the implication that nobody would notice (eg, "enough to cause people to massively switch to instant coffee"). That isn't a safe position - it is likely consumers of coffee will have to cut back on something. They would notice. On your specific point that you think allocating more resources to baristas will help the economy - why not allocate the baristas to doing something more useful, where the market rate for their time is higher than $10? Allocating more to baristas is a lot of things, but it is not an evidence based strategy for increasing the general prosperity. What is it that these baristas lack? Maybe they should be trained to produce that thing, instead of getting handouts or fighting with their employers?