12 ms·

America has never gone this long without hiking the federal minimum wage

63 points by howard941 7y ago

baggy_trough 7y ago
This is very good news for teenagers and the low skilled.
- deleted 7y ago
  [deleted]
- jumbopapa 7y ago
  I wish more people understood this.
  - moate 7y ago
    Understood what? Their point is a bad faith argument and a misunderstanding of who makes low wages.
  - dangus 7y ago
    It's more nuanced than this, in my view. It's not just "high minimum wage bad for teenagers!" There are a lot of reasons for decreased teenage employment: - Older employees who should be retired hanging on to jobs longer because they can't afford retirement - Students finding part time work an inferior return on investment compared to college preparation and other resume-building activities like volunteer work - College costing so much that high school summer jobs can't possibly pay for a significant fraction of it, essentially making it a less time efficient option than just using future wages to pay for it (loans) - Lengthened academic years with shorter summers https://www.apnews.com/66a5d6cade1743fb897aad56e300c99c https://www.apnews.com/66a5d6cade1743fb897aad56e300c99c I do think that it might make sense to have a lower teenage minimum wage than the normal adult minimum wage. I personally don't assume that a low minimum wage is good for low-skill employees, that just doesn't add up to me. The inability to pay a living wage equates to all of us not paying the real cost of a good or service.
- glenda 7y ago
  Everyone deserves a living wage
  - jerf 7y ago
    When I was in high school and part-time shelving books at the local town library, no I didn't. Not for that work. Pocket money for a teenager was about the right amount of pay. Not everyone is a single mother trying to make ends meet for her two children. We should not make economic policy as if they are. "So why don't we take care of them?" Single mothers trying to make ends meet have access to a wide array of social programs already. We are already not abandoning them to the tender mercies of minimum wage and nothing else.
    - glenda 7y ago
      Sure, but the majority of people with jobs need them to survive. I'm happy that wasn't an issue for you in high school though.
    - peterwwillis 7y ago
      So, out of the 350 million people in this country, we should set national economic policy based on 1 of them (you as a teenager)
      - hodr 7y ago
        Yes. Let's go with this logic. Do you know what percentage of people in this country make minimum wage (or less)? According to the BLS it's 2.3% of wage earners, which are 58% of workers, which are 78% of the population of adults. So, 1.04% of the adult population of the US makes minimum wage. In your logic, why should we set national economic policy based on 1%?
        deleted 7y ago
        [deleted]
        peterwwillis 7y ago
jasonjei 7y ago
Frankly, I think UBI is a much better solution than increasing federal minimum wage. I think the problem with increasing minimum wage is that employers will be less likely to hire or more likely to look to automation to decrease human hiring needs. McDonald’s has already rolled out self-service kiosks, replacing cashiers entirely. UBI, on the other hand, can supplement wages.
- Retric 7y ago
  Doing both is useful as otherwise UBI subsidizes inefficiency and reduces automation. Basically, replacing people with machines is a long term gain and should be encouraged with a high minimum wage.
  - jrockway 7y ago
    Why does UBI reduce automation? Whenever I read an article, about, say, Amazon, everyone says that it's evil to make people pack packages all day. With UBI, these employees can say "screw this!" and not do that, meaning automation is the only way Amazon can stay in business. There are lots of jobs nobody wants to do, but have to to stay alive. UBI removes the "have to to stay alive" part. If we still need the economic value that those tasks generate, there is no choice but to have machines do them. That, to me, sounds like automation.
    - EpicEng 7y ago
      I have yet to see any UBI proposal that would wholly replace someone's income, so no, I don't think low skill workers would be any more likely to just up and quit. People often live to the extent of their means, so they'll still need a job.
      - rchaud 7y ago
        Nobody would agree to a UBI threshold that is equal to the median income. UBI proposals are far lower, closer to $10k/yr than $45k. It should be enough to cover the bare necessities of survival, like not starving. 10k won't be enough to cover housing in many markets.
gojomo 7y ago
The USA went 149 years, from 1789 to 1938, with no federal minimum wage – so yes, America has gone longer without any hike than just than the 10 years since 2009. Many economic experts, ignored by this article, consider no minimum wage to be the optimal level.
- ozzyman700 7y ago
  optimal level to achieve what goal?
  - whatshisface 7y ago
    The best balance between unemployment and low pay, so that the most is paid to workers overall.
    - SubiculumCode 7y ago
      Do you mean that you'd get low unemployment, but most workers get paid starvation wages, but t a few most valuable workers get much larger salaries? Poverty was absolutely horrible before minimum wage for most workers. I can't help but think that such policies you are proposing are historical revisionism at its worst.
      - whatshisface 7y ago
        The sum of all the money earned by all workers without a minimum wage is higher than with one. With a minimum wage you have one fry cook in your neighborhood making $100/hr and everyone else unemployed, without one you have 100 people making $2/hr each. More total money is given out in the second case, although I guess you can decide you'd prefer having the rich few if that's what you want (economics doesn't judge which outcome is better, it just tells you which outcome you will get). Edit: numbers made up to illustrate the claim, not to provide evidence. This claim is a widely accepted principle that you can find in any introductory econ textbook.
        7y ago
desas 7y ago
For comparison in the same time period (2009-2019) the UK minimum wage for over 25s has increased from £5.80 to £8.21. This roughly tracks UK inflation (CPI) and changes to the average wage over the same time period.
- yung_donair 7y ago
  I'm only just learning about the UK's age-dependent minimum wage [1] Is there any explanation for why such a system is used? Certainly there's plenty of financially-independent under-25s who are paid less merely because of their age, which doesn't really seem appropriate. Do other countries in Europe follow similar minimum wage schemes? EDIT: I found a paper [2] from the Netherlands (who also use an age-dependent minimum wage) suggesting that such a system can increase job termination rates close to employees birthdays. [1]: https://www.gov.uk/national-minimum-wage-rates https://www.gov.uk/national-minimum-wage-rates [2]: http://ftp.iza.org/dp9528.pdf http://ftp.iza.org/dp9528.pdf
  - rchaud 7y ago
    If the wage was the same for an 18yo with no experience vs. a 25yo who doesn't need much handholding, nobody would hire the 18yo. In most cases, older workers will also have greater financial responsibilities than a teen, so a higher wage makes sense.
    - yung_donair 7y ago
      > nobody would hire the 18yo Here in Canada, the provincial minimum wage is consistent regardless of age and yet I still see plenty of employed high school students. I also don't think that its fair to make policy-affecting assumptions regarding peoples financial responsibilities based on their age alone. I know plenty of independent 20 year olds who have significant financial responsibilities as well as 25 year olds who are voluntarily financially dependent on their parents etc. In this situation I believe an age-dependent minimum wage can actually increase inequality by determining wages based on an arbitrary metric such as age.
vpribish 7y ago
inflation has been incredibly low
- cujic9 7y ago
  In my opinion, inflation is poorly defined. The metrics we use to measure inflation (e.g. CPI) have grown slowly, but that doesn't mean that inflation is low.
sunshinelackof 7y ago
While in my opinion the minimum raise should be raised quite a lot, there are a lot of labor reforms needed. In particular for work that falls outside of the salaried work. Waged, contracted, seasonal, and temp workers do not have a lot of power in the labor market. It's actually a pretty hostile environment for individuals who don't want to collect a salary and sit at a desk. I view the problem through this lens. That essentially we have a labor surplus because the current regulatory environment is designed around salaried office workers - barring a few holdovers in the form of labor unions. The total size of the labor market is larger than the carrying capacity of office jobs. As the environment has aged firms learned how to play the game and have pushed a lot of small competition out. Meanwhile laborers compete for a smaller pool of office jobs or hope they land on their feet. This is really the nature of regulation though, it can rarely be meant to last forever and should receive continuous development and audits.
- tetra_proxy 7y ago
  Salaried work has it's problems as well. I have worked at jobs where you're expected to work 60+ hours every week for no extra pay.
RickJWagner 7y ago
We haven't gone this long without hiking the minimum wage. And we have very low unemployment, rising wages, and a roaring economy. We've also got low inflation and a robust stock market. This bears further consideration. The economy may be close to optimal.

63 points by howard941 7y ago

baggy_trough 7y ago

This is very good news for teenagers and the low skilled.

deleted 7y ago
[deleted]
jumbopapa 7y ago
I wish more people understood this.
- moate 7y ago
  Understood what? Their point is a bad faith argument and a misunderstanding of who makes low wages.
- dangus 7y ago
  It's more nuanced than this, in my view. It's not just "high minimum wage bad for teenagers!" There are a lot of reasons for decreased teenage employment: - Older employees who should be retired hanging on to jobs longer because they can't afford retirement - Students finding part time work an inferior return on investment compared to college preparation and other resume-building activities like volunteer work - College costing so much that high school summer jobs can't possibly pay for a significant fraction of it, essentially making it a less time efficient option than just using future wages to pay for it (loans) - Lengthened academic years with shorter summers https://www.apnews.com/66a5d6cade1743fb897aad56e300c99c https://www.apnews.com/66a5d6cade1743fb897aad56e300c99c I do think that it might make sense to have a lower teenage minimum wage than the normal adult minimum wage. I personally don't assume that a low minimum wage is good for low-skill employees, that just doesn't add up to me. The inability to pay a living wage equates to all of us not paying the real cost of a good or service.
glenda 7y ago
Everyone deserves a living wage
- jerf 7y ago
  When I was in high school and part-time shelving books at the local town library, no I didn't. Not for that work. Pocket money for a teenager was about the right amount of pay. Not everyone is a single mother trying to make ends meet for her two children. We should not make economic policy as if they are. "So why don't we take care of them?" Single mothers trying to make ends meet have access to a wide array of social programs already. We are already not abandoning them to the tender mercies of minimum wage and nothing else.
  - glenda 7y ago
    Sure, but the majority of people with jobs need them to survive. I'm happy that wasn't an issue for you in high school though.
  - peterwwillis 7y ago
    So, out of the 350 million people in this country, we should set national economic policy based on 1 of them (you as a teenager)
    - hodr 7y ago
      Yes. Let's go with this logic. Do you know what percentage of people in this country make minimum wage (or less)? According to the BLS it's 2.3% of wage earners, which are 58% of workers, which are 78% of the population of adults. So, 1.04% of the adult population of the US makes minimum wage. In your logic, why should we set national economic policy based on 1%?
      - deleted 7y ago
        [deleted]
      - peterwwillis 7y ago

jasonjei 7y ago

Frankly, I think UBI is a much better solution than increasing federal minimum wage. I think the problem with increasing minimum wage is that employers will be less likely to hire or more likely to look to automation to decrease human hiring needs. McDonald’s has already rolled out self-service kiosks, replacing cashiers entirely. UBI, on the other hand, can supplement wages.

Retric 7y ago
Doing both is useful as otherwise UBI subsidizes inefficiency and reduces automation. Basically, replacing people with machines is a long term gain and should be encouraged with a high minimum wage.
- jrockway 7y ago
  Why does UBI reduce automation? Whenever I read an article, about, say, Amazon, everyone says that it's evil to make people pack packages all day. With UBI, these employees can say "screw this!" and not do that, meaning automation is the only way Amazon can stay in business. There are lots of jobs nobody wants to do, but have to to stay alive. UBI removes the "have to to stay alive" part. If we still need the economic value that those tasks generate, there is no choice but to have machines do them. That, to me, sounds like automation.
  - EpicEng 7y ago
    I have yet to see any UBI proposal that would wholly replace someone's income, so no, I don't think low skill workers would be any more likely to just up and quit. People often live to the extent of their means, so they'll still need a job.
    - rchaud 7y ago
      Nobody would agree to a UBI threshold that is equal to the median income. UBI proposals are far lower, closer to $10k/yr than $45k. It should be enough to cover the bare necessities of survival, like not starving. 10k won't be enough to cover housing in many markets.

gojomo 7y ago

The USA went 149 years, from 1789 to 1938, with no federal minimum wage – so yes, America has gone longer without any hike than just than the 10 years since 2009. Many economic experts, ignored by this article, consider no minimum wage to be the optimal level.

ozzyman700 7y ago
optimal level to achieve what goal?
- whatshisface 7y ago
  The best balance between unemployment and low pay, so that the most is paid to workers overall.
  - SubiculumCode 7y ago
    Do you mean that you'd get low unemployment, but most workers get paid starvation wages, but t a few most valuable workers get much larger salaries? Poverty was absolutely horrible before minimum wage for most workers. I can't help but think that such policies you are proposing are historical revisionism at its worst.
    - whatshisface 7y ago
      The sum of all the money earned by all workers without a minimum wage is higher than with one. With a minimum wage you have one fry cook in your neighborhood making $100/hr and everyone else unemployed, without one you have 100 people making $2/hr each. More total money is given out in the second case, although I guess you can decide you'd prefer having the rich few if that's what you want (economics doesn't judge which outcome is better, it just tells you which outcome you will get). Edit: numbers made up to illustrate the claim, not to provide evidence. This claim is a widely accepted principle that you can find in any introductory econ textbook.
      - 7y ago

desas 7y ago

For comparison in the same time period (2009-2019) the UK minimum wage for over 25s has increased from £5.80 to £8.21. This roughly tracks UK inflation (CPI) and changes to the average wage over the same time period.

yung_donair 7y ago
I'm only just learning about the UK's age-dependent minimum wage [1] Is there any explanation for why such a system is used? Certainly there's plenty of financially-independent under-25s who are paid less merely because of their age, which doesn't really seem appropriate. Do other countries in Europe follow similar minimum wage schemes? EDIT: I found a paper [2] from the Netherlands (who also use an age-dependent minimum wage) suggesting that such a system can increase job termination rates close to employees birthdays. [1]: https://www.gov.uk/national-minimum-wage-rates https://www.gov.uk/national-minimum-wage-rates [2]: http://ftp.iza.org/dp9528.pdf http://ftp.iza.org/dp9528.pdf
- rchaud 7y ago
  If the wage was the same for an 18yo with no experience vs. a 25yo who doesn't need much handholding, nobody would hire the 18yo. In most cases, older workers will also have greater financial responsibilities than a teen, so a higher wage makes sense.
  - yung_donair 7y ago
    > nobody would hire the 18yo Here in Canada, the provincial minimum wage is consistent regardless of age and yet I still see plenty of employed high school students. I also don't think that its fair to make policy-affecting assumptions regarding peoples financial responsibilities based on their age alone. I know plenty of independent 20 year olds who have significant financial responsibilities as well as 25 year olds who are voluntarily financially dependent on their parents etc. In this situation I believe an age-dependent minimum wage can actually increase inequality by determining wages based on an arbitrary metric such as age.

vpribish 7y ago

inflation has been incredibly low

cujic9 7y ago
In my opinion, inflation is poorly defined. The metrics we use to measure inflation (e.g. CPI) have grown slowly, but that doesn't mean that inflation is low.

sunshinelackof 7y ago

While in my opinion the minimum raise should be raised quite a lot, there are a lot of labor reforms needed. In particular for work that falls outside of the salaried work. Waged, contracted, seasonal, and temp workers do not have a lot of power in the labor market. It's actually a pretty hostile environment for individuals who don't want to collect a salary and sit at a desk. I view the problem through this lens. That essentially we have a labor surplus because the current regulatory environment is designed around salaried office workers - barring a few holdovers in the form of labor unions. The total size of the labor market is larger than the carrying capacity of office jobs. As the environment has aged firms learned how to play the game and have pushed a lot of small competition out. Meanwhile laborers compete for a smaller pool of office jobs or hope they land on their feet. This is really the nature of regulation though, it can rarely be meant to last forever and should receive continuous development and audits.

tetra_proxy 7y ago
Salaried work has it's problems as well. I have worked at jobs where you're expected to work 60+ hours every week for no extra pay.

RickJWagner 7y ago

We haven't gone this long without hiking the minimum wage. And we have very low unemployment, rising wages, and a roaring economy. We've also got low inflation and a robust stock market. This bears further consideration. The economy may be close to optimal.