4 ms·

Unintended workplace safety consequences of minimum wages

26 points by luu 2y ago

exabrial 2y ago
> minimum wage increases adversely impact workplace safety Ironic, since the intent of minimum wage was make human capital expensive enough to promote automation and prevent human slaughter in the factories of the early 1900s
- djoldman 2y ago
  > Our findings indicate that, on average, a large minimum wage increase results in a 4.6 percent increase in the total case rate. ... > We provide suggestive evidence that small minimum wage increases might reduce injury rates, highlighting the potential heterogeneity in the impact of minimum wage changes.
dsm4ck 2y ago
The U.S. could of course just have automatic cost of living adjustment s to minimum wage, like it does for social security payments.
- nine_k 2y ago
  [flagged]
  - mclion 2y ago
    You should really look at what happens in countries with miniman wage. It's not really like you fear.
    - nine_k 2y ago
      I did look, of course. High minimum wages, serious social support for unemployed or unemployable, high taxes, generally a more collectivist mindset among citizens than what we have in the US. Additionally, the US has a very backwards system of social support, which cuts off benefits abruptly, so earning slightly more makes you suddenly quite worse off, instead of weaning you off the support smoothly as your income grows. It's literally a trap. Raising the minimum wage may trigger this for some, too, so staying at the same job at a higher hourly rate results in a lower total income than being unemployed and living entirely off benefits. This system should be fixed first.
      - ceejayoz 2y ago
        > This system should be fixed first. Hard if every proposed fix is met with "this would make even more small businesses unviable, and even more people unemployed" objections.
        nine_k 2y ago
        I see. But not touching the minimum wage, and instead making the same amount of benefits provided gradually instead of having a sharp boundary (as now) would go a long way. It won't make any businesses die; to the contrary, the people who won't take a slightly better job now would grow at work, and maybe eventually grow out of poverty entirely. Currently it's only possible by either taking a hit in income among the way, or by suddenly jumping to a much better job.
  - triceratops 2y ago
    Why? If customers still need those services, bigger businesses will provide them and hire the newly-unemployed.
    - nine_k 2y ago
      Big businesses are usually more efficient, even simply due to scale. They need fewer employees for the same amount of sales. Raising the minimum wage squeezes away the least-qualified employees, who are constrained in various ways (language, education, health, etc). The more qualified employees may and do of course benefit. High minimum wages work well with a strong social security network, and higher taxes to support it. It's not what we have in the US though.
  - jmward01 2y ago
    Really? Please back that up with actual data or studies. If labor costs go up equally then a business isn't at a competitive disadvantage. Small businesses also often get tax breaks and the like as part of minimum wage increases. In the end they often get helped by a minimum wage increase. At a minimum it isn't a slam dunk in any way that 'they make small businesses unviable' while it is very clear that it makes lives better for employees [1]. Finally, if a business isn't creating jobs that provide a living wage then it shouldn't be allowed to exist since those employees are likely being subsidized by taxpayers for the gap between what the business is paying and what they need to live on. Put simply, I don't want to subsidize a business so that it can avoid paying its employees. [1] https://irle.berkeley.edu/wp-content/uploads/2023/03/Small-Businesses-and-the-Minimum-Wage-3-14-23.pdf https://irle.berkeley.edu/wp-content/uploads/2023/03/Small-B...
    - jldugger 2y ago
      > If labor costs go up equally then a business isn't at a competitive disadvantage The classic low wage job is flipping burgers. Everyone with a kitchen is a competitor to this business, and if restaurants all raise prices in lock step, it stands to reason at least some people will cook at home instead. > if a business isn't creating jobs that provide a living wage then it shouldn't be allowed to exist ... I don't want to subsidize a business so that it can avoid paying its employees. I doubt you meant it this way, but that's a fascinating argument against progressive taxation.
      - jmward01 2y ago
        > The classic low wage job is flipping burgers. Everyone with a kitchen is a competitor to this business, and if restaurants all raise prices in lock step, it stands to reason at least some people will cook at home instead. And meanwhile there will be more people with more money in their pockets able to now go out and get a meal somewhere. The secondary effects are many and you can't isolate price increase without looking at the new demand created. It may seem odd, but when you pay people more they end up spending more. [1] Additionally, part of the problem here is the perception that 'The classic low wage job is flipping burgers.' with the implication that that is just for high school kids so not a real job. Unfortunately this whole country runs on gig and minimum wage jobs (or worse). Enabling these jobs is just a route to funneling money up and increasing the wealth gap. People are doing an honest day's work and should be paid enough to live on that. Any argument to short-change them is an argument that society has to pick up for the slack of the employer. Are you suggesting we increase taxes to pay for that gap? Because that is what actually happens. So, why not. But instead of taxing me for a bad employment model, let's instead put a huge wealth tax on businesses that pay less than a minimum wage and then use it to pay for all the social programs that are needed to keep that workforce alive. I don't personally like that idea but at least then the costs of cheap labor would be put onto the places abusing it and not me. [1] https://cepr.org/voxeu/columns/spending-income-and-debt-responses-minimum-wage-hikes https://cepr.org/voxeu/columns/spending-income-and-debt-resp...
Noumenon72 2y ago
The compensation package for a job includes a certain mix of "how hard do we make you work, how nice are the conditions, how much do we pay". Minimum wage keeps you from trading those off. Now you get paid more but you have to hustle to earn it, no perks, and less budget for the safety committee.
pydry 2y ago
I guess since dube, lester, reich the think tank crowd has given up on trying to demonstrate that it destroys jobs and are trying a different tack. It's worth noting that mininum wage hikes are a very profit hostile policy. This is why they tend to receive such huge pushback.
_aleph2c_ 2y ago
Having started at the bottom, I think the most important thing for people in this situation is to be able to get the next higher paying job, then the next higher paying job. Minimum wage should be temporary - so this study is kind of stupid. In my experience, my worst enemies were exhaustion, the crab-in-the-bucket attitude of my peers, and an inability to build a resume and to network out to the people who wanted what I could do. Ultimately I couldn't escape poverty until I could buy enough gear to work up north. That money made it possible to pay for an education. To help the poor, make it easy for them to climb the economic ladder. If safety makes this harder, I would prioritize job-mobility over safety.
- wredcoll 2y ago
  > Minimum wage should be temporary - so this study is kind of stupid. I see this type of attitude/comment frequently whenever the minimum wage comes up, but I've never seen any kind of justification for it. If these aren't "real jobs" that deserve "real pay" then why are there billion(trillion?) dollar corporations built entirely on top of employing millions of people at minimum wage?
  - ndileas 2y ago
    I think a lot of the confusion here comes from a conflict between people talking in personal mode and societal modes. As an individual, you absolutely want minimum wage to be temporary, and if you are smart and lucky you can usually make this happen. You're taking more a societal point of view. At this level, I think you're missing the point of minimum wage. It doesn't provide a family with a living wage; it's just a limit on the monetary abuse that an above board company can dish out, just like we have labor laws that limit other types of abuse (like excessive hours for example). Whether and how our society should be ensuring living wages is kind of another discussion, much more complex. As they currently stand, minimum wages are probably a net good.
    - nemomarx 2y ago
      not intended by who? when the minimum wage was introduced it was talked about as a living wage intended to be enough to raise a family on.
LordDragonfang 2y ago
Yet another reason why the minimum/living wage treadmill isn't the right solution, and labor activist should push more seriously for UBI. The fact of the matter is that many people's labor isn't worth a living wage, and especially not for ethical working conditions. The goal of every job paying enough to be comfortable is missing the forest for the trees, because it will always fail to account for the cost of the stress of working, and always be at odds with safety. The actual goal should be that people should be able to survive comfortably no matter their ability to get a "good" job, because as we automate more, it's just a simple fact that "good" jobs will continue to get harder to come by.
- mitthrowaway2 2y ago
  Absolutely this. Rather than having minimum wage be $15, UBI should be $15/hour, and then there need be no floor for the amount on top of that that employers are allowed to pay for labor. (Probably there will be a floor to what laborers will accept, because of how much less desperate they will be, resulting in a higher wage share of income overall, and generally reduced wealth inequality across society).
GabeIsko 2y ago
Sounds like we need more safety regulations.
- deleted 2y ago
  [deleted]
- 3D30497420 2y ago
  Or better enforcement. To widely speculate, I doubt the US will be getting either of those. /s
grayhatter 2y ago
so, p-hacking, or following a meaningful wage increase, employees are more likely, or more able to report an injury, and the actual rate of injury didn't change? Or am I missing another more obvious conclusion here?
- jmward01 2y ago
  That was my thought too. I just scanned the paper but I didn't see them discussing controlling for changes in reporting based on pay increases. If you beat someone constantly they just whimper. If you hit them only once they will scream loudly. I think there is a chance that is happening here.
- crooked-v 2y ago
  I immediately think of line cooks, who are perennially underpaid and extremely replaceable and are expected to tough out any injury short of a hospital visit.
  - soupfordummies 2y ago
    Really almost anyone paid hourly. Time spent dealing with injury is time spent not working which is time spent NOT getting paid.
petsfed 2y ago
They keep saying that a "large" increase in minimum wage results in a 4.6% increase in case rate. But they don't [d̶e̶f̶i̶n̶e̶ ̶"̶l̶a̶r̶g̶e̶"̶ ̶(̶e̶s̶p̶e̶c̶i̶a̶l̶l̶y̶ ̶v̶s̶.̶ ̶"̶s̶m̶a̶l̶l̶"̶,̶ ̶w̶h̶i̶c̶h̶ ̶t̶h̶e̶y̶ ̶p̶o̶i̶n̶t̶ ̶o̶u̶t̶ ̶l̶e̶a̶d̶s̶ ̶t̶o̶ ̶l̶o̶w̶e̶r̶i̶n̶g̶ ̶c̶a̶s̶e̶ ̶r̶a̶t̶e̶)̶,̶ ̶n̶o̶r̶ ̶d̶o̶ ̶t̶h̶e̶y̶] point out a margin of error or a noise floor early enough in the paper for a non-paying reader to see. They also say that they "do not find evidence that capital-labor substitution could be behind the findings", but its again not within the scope of the free article to show how they were looking for such evidence, and what defined "capitol-labor substitution". Were they looking purely for "it costs $5k a year to provide everyone with safety glasses, but operating costs just increased by $50k on what used to net $60k of profit, so I guess we're not doing safety glasses anymore" or if the same reasoning was used on $600k of profit. The former is clearly capitol-labor substitution, the latter is being cheap out of spite. Maybe these questions are being answered in a satisfactory manner, but the fact that they use a blend of wiggle words and hard numbers, with no clarifying context even in the abstract, suggests to me that this does not actually support the strawman everybody seems to be getting from it, which is "see, paying the person at McDonalds enough to actually make rent this month might get them killed! You don't want to pay them so much they might die, right?"
- ceejayoz 2y ago
  They do define "large". > We focus on large minimum wage increases (≥ $1 per hour), which are likely to be binding (Clemens and Strain, 2021, Fone et al., 2023).
  - petsfed 2y ago
    Thanks! I did not see that previously. Going to edit my post now...
ceejayoz 2y ago
> Prior studies document that financial constraints reduce safety investment and thus increase injuries... I mean, maybe, but that goes both ways. Someone with a bit more financial security might be more able to seek treatment, too. $500 in savings makes it easier to miss a shift to go to urgent care.
Simon_O_Rourke 2y ago
I'd be interested in some of the speculated causation here, do folks think that because they're getting paid more then they are expected to work 4.6% harder therefore get injured at that higher rate?
- yojo 2y ago
  A few possibilities: 1) Companies barely scraping by start cutting corners when labor gets more expensive. The work environment becomes more dangerous. 2) Companies paying more for labor set higher output demands for that labor. The job gets harder. 3) Companies paying more for labor are hesitant to hire more, given the increased costs/risks of adding FTEs. They instead ask existing workers to work more. The hours get longer. 4) Employees getting paid more feel empowered to report accidents that previously would have been hidden. The workers become more outspoken.
jas39 2y ago
[flagged]
- epicureanideal 2y ago
  Minimum wage is a way to avoid total exploitation. The poor have very little bargaining power. But we also need to reduce the supply of labor to keep reasonable wages.
  - jas39 2y ago
    It is not true. The minimum wage was primarily an eugenic measure introduced during the progressive era. The idea was to prevent Chinese and other immigrants from undercutting white labour. The people arguing for it back then understood the effect of minimum wage very well. They just had different motivations.
Animats 2y ago
Do they have a breakdown by industry? That would give some insight into what's happening. Did a wage increase cause management to try a speedup?
Jackosas 2y ago
[dead]

26 points by luu 2y ago

> minimum wage increases adversely impact workplace safety Ironic, since the intent of minimum wage was make human capital expensive enough to promote automation and prevent human slaughter in the factories of the early 1900s

djoldman 2y ago
> Our findings indicate that, on average, a large minimum wage increase results in a 4.6 percent increase in the total case rate. ... > We provide suggestive evidence that small minimum wage increases might reduce injury rates, highlighting the potential heterogeneity in the impact of minimum wage changes.

dsm4ck 2y ago

The U.S. could of course just have automatic cost of living adjustment s to minimum wage, like it does for social security payments.

nine_k 2y ago
[flagged]
- mclion 2y ago
  You should really look at what happens in countries with miniman wage. It's not really like you fear.
  - nine_k 2y ago
    I did look, of course. High minimum wages, serious social support for unemployed or unemployable, high taxes, generally a more collectivist mindset among citizens than what we have in the US. Additionally, the US has a very backwards system of social support, which cuts off benefits abruptly, so earning slightly more makes you suddenly quite worse off, instead of weaning you off the support smoothly as your income grows. It's literally a trap. Raising the minimum wage may trigger this for some, too, so staying at the same job at a higher hourly rate results in a lower total income than being unemployed and living entirely off benefits. This system should be fixed first.
    - ceejayoz 2y ago
      > This system should be fixed first. Hard if every proposed fix is met with "this would make even more small businesses unviable, and even more people unemployed" objections.
      - nine_k 2y ago
        I see. But not touching the minimum wage, and instead making the same amount of benefits provided gradually instead of having a sharp boundary (as now) would go a long way. It won't make any businesses die; to the contrary, the people who won't take a slightly better job now would grow at work, and maybe eventually grow out of poverty entirely. Currently it's only possible by either taking a hit in income among the way, or by suddenly jumping to a much better job.
- triceratops 2y ago
  Why? If customers still need those services, bigger businesses will provide them and hire the newly-unemployed.
  - nine_k 2y ago
    Big businesses are usually more efficient, even simply due to scale. They need fewer employees for the same amount of sales. Raising the minimum wage squeezes away the least-qualified employees, who are constrained in various ways (language, education, health, etc). The more qualified employees may and do of course benefit. High minimum wages work well with a strong social security network, and higher taxes to support it. It's not what we have in the US though.
- jmward01 2y ago
  Really? Please back that up with actual data or studies. If labor costs go up equally then a business isn't at a competitive disadvantage. Small businesses also often get tax breaks and the like as part of minimum wage increases. In the end they often get helped by a minimum wage increase. At a minimum it isn't a slam dunk in any way that 'they make small businesses unviable' while it is very clear that it makes lives better for employees [1]. Finally, if a business isn't creating jobs that provide a living wage then it shouldn't be allowed to exist since those employees are likely being subsidized by taxpayers for the gap between what the business is paying and what they need to live on. Put simply, I don't want to subsidize a business so that it can avoid paying its employees. [1] https://irle.berkeley.edu/wp-content/uploads/2023/03/Small-Businesses-and-the-Minimum-Wage-3-14-23.pdf https://irle.berkeley.edu/wp-content/uploads/2023/03/Small-B...
  - jldugger 2y ago
    > If labor costs go up equally then a business isn't at a competitive disadvantage The classic low wage job is flipping burgers. Everyone with a kitchen is a competitor to this business, and if restaurants all raise prices in lock step, it stands to reason at least some people will cook at home instead. > if a business isn't creating jobs that provide a living wage then it shouldn't be allowed to exist ... I don't want to subsidize a business so that it can avoid paying its employees. I doubt you meant it this way, but that's a fascinating argument against progressive taxation.
    - jmward01 2y ago
      > The classic low wage job is flipping burgers. Everyone with a kitchen is a competitor to this business, and if restaurants all raise prices in lock step, it stands to reason at least some people will cook at home instead. And meanwhile there will be more people with more money in their pockets able to now go out and get a meal somewhere. The secondary effects are many and you can't isolate price increase without looking at the new demand created. It may seem odd, but when you pay people more they end up spending more. [1] Additionally, part of the problem here is the perception that 'The classic low wage job is flipping burgers.' with the implication that that is just for high school kids so not a real job. Unfortunately this whole country runs on gig and minimum wage jobs (or worse). Enabling these jobs is just a route to funneling money up and increasing the wealth gap. People are doing an honest day's work and should be paid enough to live on that. Any argument to short-change them is an argument that society has to pick up for the slack of the employer. Are you suggesting we increase taxes to pay for that gap? Because that is what actually happens. So, why not. But instead of taxing me for a bad employment model, let's instead put a huge wealth tax on businesses that pay less than a minimum wage and then use it to pay for all the social programs that are needed to keep that workforce alive. I don't personally like that idea but at least then the costs of cheap labor would be put onto the places abusing it and not me. [1] https://cepr.org/voxeu/columns/spending-income-and-debt-responses-minimum-wage-hikes https://cepr.org/voxeu/columns/spending-income-and-debt-resp...

Noumenon72 2y ago

The compensation package for a job includes a certain mix of "how hard do we make you work, how nice are the conditions, how much do we pay". Minimum wage keeps you from trading those off. Now you get paid more but you have to hustle to earn it, no perks, and less budget for the safety committee.

pydry 2y ago

I guess since dube, lester, reich the think tank crowd has given up on trying to demonstrate that it destroys jobs and are trying a different tack. It's worth noting that mininum wage hikes are a very profit hostile policy. This is why they tend to receive such huge pushback.

_aleph2c_ 2y ago

Having started at the bottom, I think the most important thing for people in this situation is to be able to get the next higher paying job, then the next higher paying job. Minimum wage should be temporary - so this study is kind of stupid. In my experience, my worst enemies were exhaustion, the crab-in-the-bucket attitude of my peers, and an inability to build a resume and to network out to the people who wanted what I could do. Ultimately I couldn't escape poverty until I could buy enough gear to work up north. That money made it possible to pay for an education. To help the poor, make it easy for them to climb the economic ladder. If safety makes this harder, I would prioritize job-mobility over safety.

wredcoll 2y ago
> Minimum wage should be temporary - so this study is kind of stupid. I see this type of attitude/comment frequently whenever the minimum wage comes up, but I've never seen any kind of justification for it. If these aren't "real jobs" that deserve "real pay" then why are there billion(trillion?) dollar corporations built entirely on top of employing millions of people at minimum wage?
- ndileas 2y ago
  I think a lot of the confusion here comes from a conflict between people talking in personal mode and societal modes. As an individual, you absolutely want minimum wage to be temporary, and if you are smart and lucky you can usually make this happen. You're taking more a societal point of view. At this level, I think you're missing the point of minimum wage. It doesn't provide a family with a living wage; it's just a limit on the monetary abuse that an above board company can dish out, just like we have labor laws that limit other types of abuse (like excessive hours for example). Whether and how our society should be ensuring living wages is kind of another discussion, much more complex. As they currently stand, minimum wages are probably a net good.
  - nemomarx 2y ago
    not intended by who? when the minimum wage was introduced it was talked about as a living wage intended to be enough to raise a family on.

LordDragonfang 2y ago

Yet another reason why the minimum/living wage treadmill isn't the right solution, and labor activist should push more seriously for UBI. The fact of the matter is that many people's labor isn't worth a living wage, and especially not for ethical working conditions. The goal of every job paying enough to be comfortable is missing the forest for the trees, because it will always fail to account for the cost of the stress of working, and always be at odds with safety. The actual goal should be that people should be able to survive comfortably no matter their ability to get a "good" job, because as we automate more, it's just a simple fact that "good" jobs will continue to get harder to come by.

mitthrowaway2 2y ago
Absolutely this. Rather than having minimum wage be $15, UBI should be $15/hour, and then there need be no floor for the amount on top of that that employers are allowed to pay for labor. (Probably there will be a floor to what laborers will accept, because of how much less desperate they will be, resulting in a higher wage share of income overall, and generally reduced wealth inequality across society).

GabeIsko 2y ago

Sounds like we need more safety regulations.

deleted 2y ago
[deleted]
3D30497420 2y ago
Or better enforcement. To widely speculate, I doubt the US will be getting either of those. /s

grayhatter 2y ago

so, p-hacking, or following a meaningful wage increase, employees are more likely, or more able to report an injury, and the actual rate of injury didn't change? Or am I missing another more obvious conclusion here?

jmward01 2y ago
That was my thought too. I just scanned the paper but I didn't see them discussing controlling for changes in reporting based on pay increases. If you beat someone constantly they just whimper. If you hit them only once they will scream loudly. I think there is a chance that is happening here.
crooked-v 2y ago
I immediately think of line cooks, who are perennially underpaid and extremely replaceable and are expected to tough out any injury short of a hospital visit.
- soupfordummies 2y ago
  Really almost anyone paid hourly. Time spent dealing with injury is time spent not working which is time spent NOT getting paid.

petsfed 2y ago

They keep saying that a "large" increase in minimum wage results in a 4.6% increase in case rate. But they don't [d̶e̶f̶i̶n̶e̶ ̶"̶l̶a̶r̶g̶e̶"̶ ̶(̶e̶s̶p̶e̶c̶i̶a̶l̶l̶y̶ ̶v̶s̶.̶ ̶"̶s̶m̶a̶l̶l̶"̶,̶ ̶w̶h̶i̶c̶h̶ ̶t̶h̶e̶y̶ ̶p̶o̶i̶n̶t̶ ̶o̶u̶t̶ ̶l̶e̶a̶d̶s̶ ̶t̶o̶ ̶l̶o̶w̶e̶r̶i̶n̶g̶ ̶c̶a̶s̶e̶ ̶r̶a̶t̶e̶)̶,̶ ̶n̶o̶r̶ ̶d̶o̶ ̶t̶h̶e̶y̶] point out a margin of error or a noise floor early enough in the paper for a non-paying reader to see. They also say that they "do not find evidence that capital-labor substitution could be behind the findings", but its again not within the scope of the free article to show how they were looking for such evidence, and what defined "capitol-labor substitution". Were they looking purely for "it costs $5k a year to provide everyone with safety glasses, but operating costs just increased by $50k on what used to net $60k of profit, so I guess we're not doing safety glasses anymore" or if the same reasoning was used on $600k of profit. The former is clearly capitol-labor substitution, the latter is being cheap out of spite. Maybe these questions are being answered in a satisfactory manner, but the fact that they use a blend of wiggle words and hard numbers, with no clarifying context even in the abstract, suggests to me that this does not actually support the strawman everybody seems to be getting from it, which is "see, paying the person at McDonalds enough to actually make rent this month might get them killed! You don't want to pay them so much they might die, right?"

ceejayoz 2y ago
They do define "large". > We focus on large minimum wage increases (≥ $1 per hour), which are likely to be binding (Clemens and Strain, 2021, Fone et al., 2023).
- petsfed 2y ago
  Thanks! I did not see that previously. Going to edit my post now...

ceejayoz 2y ago

> Prior studies document that financial constraints reduce safety investment and thus increase injuries... I mean, maybe, but that goes both ways. Someone with a bit more financial security might be more able to seek treatment, too. $500 in savings makes it easier to miss a shift to go to urgent care.

Simon_O_Rourke 2y ago

I'd be interested in some of the speculated causation here, do folks think that because they're getting paid more then they are expected to work 4.6% harder therefore get injured at that higher rate?

yojo 2y ago
A few possibilities: 1) Companies barely scraping by start cutting corners when labor gets more expensive. The work environment becomes more dangerous. 2) Companies paying more for labor set higher output demands for that labor. The job gets harder. 3) Companies paying more for labor are hesitant to hire more, given the increased costs/risks of adding FTEs. They instead ask existing workers to work more. The hours get longer. 4) Employees getting paid more feel empowered to report accidents that previously would have been hidden. The workers become more outspoken.

jas39 2y ago

[flagged]

epicureanideal 2y ago
Minimum wage is a way to avoid total exploitation. The poor have very little bargaining power. But we also need to reduce the supply of labor to keep reasonable wages.
- jas39 2y ago
  It is not true. The minimum wage was primarily an eugenic measure introduced during the progressive era. The idea was to prevent Chinese and other immigrants from undercutting white labour. The people arguing for it back then understood the effect of minimum wage very well. They just had different motivations.

Animats 2y ago

Do they have a breakdown by industry? That would give some insight into what's happening. Did a wage increase cause management to try a speedup?

Jackosas 2y ago

[dead]