6 ms·

It's the same old story every time minimum wage is raised. Will they never learn?

eplanit 8y ago
Exactly. The writer of the article seems to be mystified and shocked by the (very predictable) outcome.
drugme 8y ago
Exactly - when minimum wages are introduced, they need to be met with rigorous protections against reductions in working hours.
- jcims 8y ago
  How would that work when it is voluntary by the employer?
  - drugme 8y ago
    How would that work when it is voluntary by the employer? It won't be. We've had a go at letting employers "voluntarily" provide a reasonable living wage to low-skilled workers -- but obviously that tactic has failed miserably. So it's time to try something else.
- lotsofpulp 8y ago
  Why not just have the government pay the person directly? Complicating things only introduces avenues for corruption and errors.
  - squish78 8y ago
    Yes, the government has no corruption and makes no errors
    - lotsofpulp 8y ago
      My comment does not imply that the government makes no errors or cannot be corrupted. Corruption and errors are a possibility with all entities, but adding more entities in the chain increases the probability of it.
  - sf_rob 8y ago
    EITC is very roughly this.
  - zapita 8y ago
    The US government already subsidizes underpaying employers in the form of food stamps and other palliative services. If employers were required to pay for the foodstamps and welfare services of their own workers, I wonder if we would see a change in their behavior? It would suddenly make less economical sense to reduce costs by pushing their most vulnerable workers below the poverty line, since that would just push up their welfare costs. Today they don’t pay a dime - so hey, if the government is subsidizing you to screw your workforce, and public opinion is brainwashed to blame the workers instead of you, why would you not do it?
    - lotsofpulp 8y ago
      I see all of that as a consequence of unnecessary complications. If society’s goal is to provide people with a quality of life floor, then do that for everyone equally. Then you don’t have to calculate the costs of which employer is using how much welfare (which are impossible calculations anyway subject to political pressure).
  - sieabahlpark 8y ago
    Then you just layoff half your workforce to afford the half you can't reduce.
  - jmpman 8y ago
    Universal Basic Income plus the elimination of the minimum wage would be an interesting experiment.
    - mathgladiator 8y ago
      This is where I am at with my thinking. Minimum wage creates an oversized leadership/management problem.
- xtreme 8y ago
  Which will be followed by reduction in the number of workers and increased unemployment.
  - drugme 8y ago
    ... or an increase in the price of goods and services, per the Scandinavian model. Which seems to work well enough for those countries.
astazangasta 8y ago
Its not clear what you expect people to learn. To me the obvious result will be Amazon must invest in increasing worker productivity to match its wage hike if it wants to maintain output. Win.
- x38iq84n 8y ago
  Lean that an artificial increase of the cost of labor causes some of the most vulnerable and lowest income workers be squeezed out of the labor market. Once too expensive, they get replaced by a machine (e.g. taking fast food orders) or the staff is downsized. Either way, those who were supposed to be helped are made worse off.
  - tenpies 8y ago
    As my possibly-psychopathic, but well-intended manager once said: "the more you cost, the more we want to replace you". Other gems include: "I love when employees buy houses or have children. It means now they're tied down and are less willing to leave".
  - astazangasta 8y ago
    The cost of labor doesn't behave like other things, because people spend their wages. Raising wages can boost aggregate demand, making more work for everyone, including low wage workers displaced by increasing productivity. Artifically increasing wages has the effect of forcing investment in productivity (rather than relying on the low cost of labor). Increasing demand also makes the labor market tighter, which boosts wages and encourages further productivity increases. Boosting wages for the lowest paid workers also has good distributional effects because wages have higher utility, are spent more, etc. Etc.
- salawat 8y ago
  That's based on the assumption that workers were being fairly compensated for what Amazon was getting in the first place. Hint: If you got a wage increase because of a minimum wage bump, you were probably being cheated in the first place. I don't really understand the mentality in the United States where physical labor to perform complex (unautomatable or impractically automatable) tasks are so severely undercompensated. We pretend that having another human being sacrifice 8 hours of their life, and the costs to show up is worth barely enough where at the end of the month, societal safety nets need to be invoked to stay solvent. It's mystifying. Is there something viscerally unpleasant to imagining someone flipping burgers for a living being able to afford to rent their own apartment, and be able to have enough to invest in bettering their lot? The economy is horribly skewed. Labor is getting repeatedly short changed in an infantile quest for "the biggest growth numbers ever". It's a problem that won't be solved until the labor pool refuses to play ball, forcing businesses to grind to a halt. Taft-Hartley or not, Labor is going to be making many large waves in the coming years methinks. There may be no 'society' anymore, bit there are a hell of a lot of people out there getting played.

Exactly. The writer of the article seems to be mystified and shocked by the (very predictable) outcome.

Exactly - when minimum wages are introduced, they need to be met with rigorous protections against reductions in working hours.

jcims 8y ago
How would that work when it is voluntary by the employer?
- drugme 8y ago
  How would that work when it is voluntary by the employer? It won't be. We've had a go at letting employers "voluntarily" provide a reasonable living wage to low-skilled workers -- but obviously that tactic has failed miserably. So it's time to try something else.
lotsofpulp 8y ago
Why not just have the government pay the person directly? Complicating things only introduces avenues for corruption and errors.
- squish78 8y ago
  Yes, the government has no corruption and makes no errors
  - lotsofpulp 8y ago
    My comment does not imply that the government makes no errors or cannot be corrupted. Corruption and errors are a possibility with all entities, but adding more entities in the chain increases the probability of it.
- sf_rob 8y ago
  EITC is very roughly this.
- zapita 8y ago
  The US government already subsidizes underpaying employers in the form of food stamps and other palliative services. If employers were required to pay for the foodstamps and welfare services of their own workers, I wonder if we would see a change in their behavior? It would suddenly make less economical sense to reduce costs by pushing their most vulnerable workers below the poverty line, since that would just push up their welfare costs. Today they don’t pay a dime - so hey, if the government is subsidizing you to screw your workforce, and public opinion is brainwashed to blame the workers instead of you, why would you not do it?
  - lotsofpulp 8y ago
    I see all of that as a consequence of unnecessary complications. If society’s goal is to provide people with a quality of life floor, then do that for everyone equally. Then you don’t have to calculate the costs of which employer is using how much welfare (which are impossible calculations anyway subject to political pressure).
- sieabahlpark 8y ago
  Then you just layoff half your workforce to afford the half you can't reduce.
- jmpman 8y ago
  Universal Basic Income plus the elimination of the minimum wage would be an interesting experiment.
  - mathgladiator 8y ago
    This is where I am at with my thinking. Minimum wage creates an oversized leadership/management problem.
xtreme 8y ago
Which will be followed by reduction in the number of workers and increased unemployment.
- drugme 8y ago
  ... or an increase in the price of goods and services, per the Scandinavian model. Which seems to work well enough for those countries.

astazangasta 8y ago

Its not clear what you expect people to learn. To me the obvious result will be Amazon must invest in increasing worker productivity to match its wage hike if it wants to maintain output. Win.

x38iq84n 8y ago
Lean that an artificial increase of the cost of labor causes some of the most vulnerable and lowest income workers be squeezed out of the labor market. Once too expensive, they get replaced by a machine (e.g. taking fast food orders) or the staff is downsized. Either way, those who were supposed to be helped are made worse off.
- tenpies 8y ago
  As my possibly-psychopathic, but well-intended manager once said: "the more you cost, the more we want to replace you". Other gems include: "I love when employees buy houses or have children. It means now they're tied down and are less willing to leave".
- astazangasta 8y ago
  The cost of labor doesn't behave like other things, because people spend their wages. Raising wages can boost aggregate demand, making more work for everyone, including low wage workers displaced by increasing productivity. Artifically increasing wages has the effect of forcing investment in productivity (rather than relying on the low cost of labor). Increasing demand also makes the labor market tighter, which boosts wages and encourages further productivity increases. Boosting wages for the lowest paid workers also has good distributional effects because wages have higher utility, are spent more, etc. Etc.
salawat 8y ago
That's based on the assumption that workers were being fairly compensated for what Amazon was getting in the first place. Hint: If you got a wage increase because of a minimum wage bump, you were probably being cheated in the first place. I don't really understand the mentality in the United States where physical labor to perform complex (unautomatable or impractically automatable) tasks are so severely undercompensated. We pretend that having another human being sacrifice 8 hours of their life, and the costs to show up is worth barely enough where at the end of the month, societal safety nets need to be invoked to stay solvent. It's mystifying. Is there something viscerally unpleasant to imagining someone flipping burgers for a living being able to afford to rent their own apartment, and be able to have enough to invest in bettering their lot? The economy is horribly skewed. Labor is getting repeatedly short changed in an infantile quest for "the biggest growth numbers ever". It's a problem that won't be solved until the labor pool refuses to play ball, forcing businesses to grind to a halt. Taft-Hartley or not, Labor is going to be making many large waves in the coming years methinks. There may be no 'society' anymore, bit there are a hell of a lot of people out there getting played.