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Switzerland votes on world's highest minimum wage ($25/hr)

37 points by dan_bk 12y ago

dan_bk 12y ago
My personal thought on this topic: When you work at least 8 hrs/day, 5 days/week (because somebody wants your product/service), you should be able to have a normal/decent life. If not, you're simply being ripped off. EDIT: In other words, western societies have more than enough wealth for everybody to live really decent lives. If we still see horrible things like homelessness, etc., it's because society accepts structures that result in this. And personally, I don't want to be part of a society with such values.
- dingaling 12y ago
  One thought experiment I encourage everyone to try, even for a day, is to look at things you buy as a product of your locale's minimum wage. For example in the UK a lunchtime coffee is about 25 minutes 'worth' of min wage. A one-hour flying lesson is 25 minimum-wage-hours. Even a can of humble baked beans in sauce is five minimum-wage0minutes. It is very humbling.
  - neosilky 12y ago
    I do this! Very good exercise for deciding if things are worth it.
  - neosilky 12y ago
    I do this! Very good exercise for deciding if things are worth it.
- ars 12y ago
  Where's the money coming from though? Assuming no import/export (a false assumption of course) then increasing the minimum wage just increases costs, and you end up exactly where you started. There was a time when resources were a large percentage of the cost of good - those days are long gone, today wages are the largest part. You pay people more, so you have to charge people more, and they have more money so they can afford it so prices are successful in going up. Net result: Absolutely no change.
  - dan_bk 12y ago
    > You pay people more, so you have to charge people more Or maybe some overpaid positions will have to accept a cut that they will never even feel in the slightest way. An INcrease of, say, $500/month to reach $4000/month can "change a World". But a $500/month DEcrease to reach i.e. $39'500/month will never even be felt. In economic terms: The marginal benefit of an increasing wage decreases. There is a fuzzy limit where more money does NOT make you more happy.
    - ma2rten 12y ago
      The problem with that is that there are much more workers than CEOs.
      - leaveyou 12y ago
        It's not such a big problem if you consider that many CEOs are paid well over 200x more than their nonsupervisor worker. http://go.bloomberg.com/multimedia/ceo-pay-ratio/ http://go.bloomberg.com/multimedia/ceo-pay-ratio/ http://www.businessweek.com/articles/2013-05-02/disclosed-the-pay-gap-between-ceos-and-employees http://www.businessweek.com/articles/2013-05-02/disclosed-th...
        Zak 12y ago
        JCPenny, the company with the highest ratio on the first chart appears to employ about 117,000 people[0]. If the CEO gave up all his pay, they would be able to hire 1,795 more people - about 1.5%. Add together the top 20 and it's 18,860 people. Those same numbers likely apply to how many low-paid employees could be increased to around $15/hour[1]. In absolute terms, those sound like big numbers, but the US officially[2] has 9.8 million unemployed people[3] and a great many more working for low pay. 18860 more minimum wage jobs would be less than 0.2%. Flattening out the pay distribution in large companies may appeal to our sense of fairness, but it doesn't actually do much to alleviate poverty. [0] http://www.macroaxis.com/invest/ratio/JCP--Number_of_Employees http://www.macroaxis.com/invest/ratio/JCP--Number_of_Employe... [1] The underlying assumption being that most of these companies have a large number of minimum wage employees. [2] Unemployment numbers are skewed low because they don't count people who aren't following a specific pattern of job-seeking. [3] http://www.bls.gov/news.release/empsit.nr0.htm http://www.bls.gov/news.release/empsit.nr0.htm
- yummyfajitas 12y ago
  What basket of goods/services defines a "normal/decent life"? And what goods/services in the aforementioned basket do you believe people in the west are lacking?
- grimtrigger 12y ago
  > When you work at least 8 hrs/day, 5 days/week (because somebody wants your product/service), you should be able to have a normal/decent life. This is a fantasy. Imagine if I decide to become a human calculator, and that my job is going to be solving algebra problems. People will mail me simple problems (5+7) and I'll mail them back a solution. You might say "thats ridiculous! We have computers that can do that much more efficiently". Can I then argue "well, I work 8 hours a day! therefore I deserve a living wage"?.
  - TallGuyShort 12y ago
    You're missing the part where they said "because somebody wants your ... service". No one would want your service, so why should you get a living wage for doing it? I still disagree with GP, however. If someone wants your service more than they want to keep a minimum wage worth of money, you could negotiate for that. The fact that so many people do not or cannot is proof that raising the minimum wage is at best an extremely short term solution, and we'll just have to keep raising it forever and ever to keep up with inflation. It doesn't magically start getting people what armchair politicians think people deserve.
    - pessimizer 12y ago
      Raising the minimum wage doesn't push up inflation like that.
- bluedevil2k 12y ago
  But why $25/hr? A 50 hour work week would bring in $62,000 a year. A married couple working "minimum wage" jobs would make over $120,000 a year. That's crazy. The "minimum wage" would put a couple in the top 10% of American household earners. Working backwards from a stated goal that a hard working Amarican married couple should be "middle class", and should make a middle class income of $60,000 (about what people consider middle class), working 50 hours a week equates to a minimum wage of $12/hr. (Given, my equation breaks down when considering unmarried parents, but it's a quick way to discuss what is the "ideal" minimum wage. If you work, you're middle class - if you choose not to work, that naturally results in lower income)
  - Spiritus 12y ago
    Why would you calculate on a 50 hour work week? That's ~10 too much.
    - bhaak 12y ago
      The common Swiss work week is 42 hours. So it's "only" a 8 hours difference.
      - jellicle 12y ago
        42 paid hours?
        bhaak 12y ago
        Yes, although if you work full-time, you are usually not paid by the hour, but have a fixed salary.
    - bluedevil2k 12y ago
      Too much by whose definition? What's wrong with the notion of "work hard and get a middle class life". The notion of "work the bare minimum and get an upper middle class life" won't have the same result.
- Houshalter 12y ago
  I agree, but what does that have to do with minimum wage? Raising the minimum wage doesn't necessarily raise people's income. If your labor is not worth more than $25/h to your employer you'll just lose your job (or never get hired in the first place.) Another problem is that the costs are not spread equally. An industry that employs a lot of low skill workers has to burden a huge amount of the cost of it, whereas a business that automates all their employees doesn't have to pay a dime. And those costs might pass on to consumers and cause problems, competing with different countries. The better alternative is a basic income (or some variation of it.) Tax everyone, not just the industries that employ lots of workers, include the unemployed in the benefits, and don't create artificial disincentives to hire people.
  - dan_bk 12y ago
    > If your labor is not worth more than $25/h to your employer you'll just lose your job (or never get hired in the first place.) Well, you can always increase the number of jobs in a country by lowering the country's wages. By that logic, the taxpayer ends up footing the bill (via social insurance programs => taxes) that the employer should have paid.
    - Houshalter 12y ago
      Wages should be set by supply and demand like everything else. Taxpayers should pay for social programs, it spreads the cost out among the entire economy. Adding additional costs to a person, should a business decide to hire them, just discourages them from hiring and creates all the problems I mentioned above.
  - pessimizer 12y ago
    >Raising the minimum wage doesn't necessarily raise people's income. If your labor is not worth more than $25/h to your employer you'll just lose your job (or never get hired in the first place.) What you're saying here is that raising the minimum wage doesn't necessarily cause a particular person's income to change at the same job that he/she had before. What it does is shift business models that depend on slave labor for their margins. It forces innovation and automation, and the people who can't acquire the skills needed can then rely on a basic income. I don't understand why the government subsidizes margins made on the backs of labor by supplementing their wages with welfare payments. If the government is supporting people, it should be reaping the benefits of their labor rather than private interests. If it can't come up with work that they can do, it should make sure that they're comfortable.
- Zak 12y ago
  Let's say I own a hotel and I'm trying to decide whether to have someone at the front desk taking check-ins and providing customer service 24 hours a day, or only 12 hours[0]. I will have to hire at least two people (full-time) or more (part-time) to accomplish this. I will only do this if the increase in business resulting from more flexible check-in times and better customer service will exceed the cost of hiring two more full-time employees. If a minimum wage is high enough that hiring these two people isn't profitable, I'll just stick to the restricted hours. Instead of being underpaid, the two people I would have hired are unemployed. Is that better? Of course, if I'm successful enough, I might be able to hire more people by reducing my own income or deferring other ways that I might re-invest in the business, but why would I do that if I'm running a business, not a charity? Any analysis of a specific minimum wage must consider the effect on unemployment. It's probably possible to calculate with a fair degree of precision - would someone with a background in economics like to chime in on this? [0] In the US, hotels without 24-hour check-in are rare; in Europe, they're common.
  - pessimizer 12y ago
    Not having 24-hour check-in is probably the most efficient way to run things, depending on your location. What you're saying here is that employers may decide that feeding, clothing, housing, entertaining, and educating an entire human being is not worth it if you're then going to sit that person behind a check in desk overnight at a hotel in order to check a couple of late guests. That's probably a wise decision for most hotels. The only reason that they're not having to face it now is because the taxpayer is supplementing that wage with welfare payments. This discriminates against less labor intensive businesses, which don't get subsidy, and devalues investment in automation. People who can't find work that supports them should be on a basic income, and/or their labor should be used by the state. A basic income could also be a lever for direct stimulus to the economy during a demand crisis.
    - Zak 12y ago
      Without getting in to the merits of a basic income, the fact is Switzerland does not currently have one. Creating a high minimum wage without adding one would likely result in a large increase in unemployment.
ars 12y ago
I kinda hope it passes - it'll be a very interesting experiment. A disaster for Switzerland of course, but someone has to do the experiment. The best case scenario is a massive increase in cost of living, more likely is a huge increase in imports (since they are cheap now), together with a drop in exports (since no one can make anything affordable). That's not a good position for any country. But, maybe I'm wrong, that's why I kinda hope they do the experiment.
- dan_bk 12y ago
  > The best case scenario is a massive increase in cost of living I absolutely do not think so. Social justice is already excellent (compared to places like the US), wages have already a certain level allowing for an OK life (so not a lot of jobs would have to be cancelled due to higher pay), but it can definitely still be improved.
- tonfa 12y ago
  Given how the swiss usually vote this has no chance to pass. And FYI lots of countries are doing this "experiment" with decent minimal wages,Switzerland is more in exception among western countries than the norm. http://en.m.wikipedia.org/wiki/List_of_minimum_wages_by_country http://en.m.wikipedia.org/wiki/List_of_minimum_wages_by_coun...
  - tonfa 12y ago
    And as a sidenote, while some European countries do not have a national minimum salary, most workers are covered by collective bargaining agreement (minimum wage per occupation/sector). This is the case in Switzerland, for example if you work in restaurant the minimum salaries are fixed, with a starting salary of 3600CHF/month if you don't have any diploma (http://www.gastrosuisse.ch/dbFile/282084/Salaires_minima__CCNT_2014.pdf http://www.gastrosuisse.ch/dbFile/282084/Salaires_minima__CC...).
- jellicle 12y ago
  I suppose it could happen your way, even though there has never been a "massive" increase in cost of living (or even a noticeable one) for any minimum wage increases ever studied in any country worldwide. I mean, you could drop a ball and have it fall upwards, too.
marincounty 12y ago
I don't know about a $25.00/hr wage, but one of the many brilliant things Switzerland does is ties fees/fines to income. So, if you are a rich man and get a speeding ticket, it will pay substantially more. I think they tie fees/fines to all aspects of working/living in Switzerland? A poor person who gets a $800 speeding ticket could become homeless. A rich person getting a expensive ticket is like getting decaf at Starbucks. People, will counter saying oh the rich pay more in income taxes. Yes-- in many cases, but I still feel fines/fees should be tied to a persons annual income. I feel it is so important it should be an admendment. I had a friend in college who dropped out after getting a $500 red light ticket. He wouldn't admit the ticket played a part in him dropping out, but I think it was a factor. I will always remember how he felt when that ticket arrived in the mail, while just finishing top ramen. He was a poor kid from an ethnic family. He was maxed out on loans and grants, and just always on the edge. Oh well, I hope you are doing well Max.
- TallGuyShort 12y ago
  I agree. People who tie this to income tax are viewing fines as revenue generators, which is wrong and harmful in so many ways. You're viewing fines as artificial incentives to obey the law. That view is more correct, IMHO, and your idea seems like a good way to apply the incentive evenly regardless of economic status.
Zarkonnen 12y ago
Seeing this thread made me remember to vote - with half an hour to spare. Thanks HN!
shirro 12y ago
I believe in a fair living wage but high wages often just mean high cost of living. Unless your purchasing power improves it is kind of pointless. Australia's minimum wage is double the USA but everything costs twice as much.
- abalone 12y ago
  Everything already costs twice as much in Switzerland. Check it: http://www.numbeo.com/cost-of-living/compare_countries_result.jsp?country1=Switzerland&country2=United+States http://www.numbeo.com/cost-of-living/compare_countries_resul...
  - tandembike 12y ago
    Yes, but they have more purchasing power and a higher quality of life index (http://www.numbeo.com/quality-of-life/rankings_by_country.jsp http://www.numbeo.com/quality-of-life/rankings_by_country.js...).
  - seanmcdirmid 12y ago
    International travel, computers, and cars cost about the same, however. Same as the Bay Area, living costs increase, but increasing purchasing power for those costs that don't increase.
- girvo 12y ago
  Not quite twice as much, but yes, much more expensive. Though we have excellent quality of life here (in my opinion). Where I get really peeved is that digital stuff and anything to do with tech often costs three, four times as much as overseas, for little to no reason. That pisses me off, to the point where I now use my VPS in Texas as a proxy to order things from overseas.
mkuhn 12y ago
So, first trends indicate that it will be rejected with 70 percent no votes. One reason that has been handed around to explain the no votes is that people do not want more regulation and think that this minimum wage would hurt more than it would help. Also: A large portion of people (90%+) already earn more than this minimum wage. [Update 13:42 CET] It now looks like it is going to be rejected with 77% of the vote. Quite a statement.
ojii 12y ago
For those interested in the results (and trends): http://www.wahlen.zh.ch/abstimmungen/2014_05_18/viewer.php?table=hochrechnung http://www.wahlen.zh.ch/abstimmungen/2014_05_18/viewer.php?t... (in German, but Google Translate does a decent job). TLDR, it's getting crushed, as expected.
- us0r 12y ago
  Is this an official government site or some polling/news site?
Dewie 12y ago
This seems like a silly title. Switzerland is already an expensive country to live in, so the minimum wage has to be pretty high compared to other places.
Kenji 12y ago
The vote doesn't make sense. If the Swiss people vote yes, the constitution will be updated with a law that the minimum wage per hour is 22 Swiss Francs. This is meaningless, considering that the constitution should be designed to hold for centuries. What are 22 Swiss francs in 100 years?
- tonfa 12y ago
  The number is indexed on price and salary changes (similar to retirement benefits).
- jellicle 12y ago
  A constitution is a set of documents that defines how a country runs at its most basic level. Not only should it not be designed to "hold for centuries", it should be easily adaptable to meet the needs of current inhabitants of the country. The decisions of people who lived hundreds of years ago have no power to bind people who live today. If your country is not making changes to its constitution on a regular, ongoing basis (every few years at most), it is certain that the constitution is not meeting the needs of most of the public.
  - Kenji 12y ago
    "A constitution is a set of documents that defines how a country runs at its most basic level." I don't consider exact values in a currency the most basic level. This law is way too specific to make it into the constitution. Especially since it disregards geographic differences in income which are quite large (consider Zurich vs a tiny village somewhere)
lawl 12y ago
Swiss here. I want to highlight two problems in the proposal: > They argue that surviving on less than 4,000 francs a month is not possible because rents, health insurance and food are all prohibitively expensive. There are multiple problems with that. The first beeing that you can survive on less than 4000 francs a month. A few of my friends are doing it, and they live directly in the city of Zürich where flats and food is most expensive. They aren't living like kings, but they can afford a small appartment and a car. Seriously, that number is just too high. Okay, as a decent (senior) dev you'll get 8000 per month, in Zürich. But as a dev, you'll have a pretty good live in Switzerland in general, nevertheless, you can live on 3000 a month directly in Zürich if you can live with a one room flat. If you're on minimum wage you'll probably want to accept a 20 minute train ride and live a bit outside the city and get a larger flat. The second problem: If you're outside of Zürich/Geneva/$expensiveCity, with 4k/month you can probably afford a 4-room flat and a decent car. Seriously, the rent is the biggest issue here, you would have to set the minimim wage depending on where in Switzerland you live (i.e. minimum wage per canton, not for the whole country). If you're on minimum wage you probably don't have a huge selection of offers where you're going to work, or the option to work remote, so you need work near your flat. So if you have to work in Zürich on minimum wage, that would be just plain unfair. Having said that, I'm not against minimum wage, I just think the proposal is bullshit.
wiseignorant 12y ago
If they voted in favor, most Swiss would probably have to be considered morally inconsistent, because most of them will often cross the border with Italy, Germany or France just to have a nice meal at a restaurant (in Switzerland is already really expensive to the point of justifying the short trip). So in this case they would basically be saying that it's not ok to be paid less then 22 francs, but they are more than happy using a service where people earn much less than that. "But probably they will leave a huge tip for the staff in those countries". Well, I don't think so. In other words, as always, "it's easy to love 'humanity', but too damn hard to love the individual next to you", isn't it? Overall there is a lot of hypocrisy in those that support minimum wage, as a lot of them will say: "everybody should have a 'descent' wage", but then they are pretty happy buying cheap gadgets made by low paid Chinese people and using the remaining cash at their disposal for something else, maybe a nice trip for which they bought a low cost ticket, which is cheap also because the baggage handler doesn't get paid 22 francs an hour, not even that poor Ryanair stewardess earns that much money. But I'm sure many supporters of minimum wage would be outraged if their London-Lisbon return ticket cost more than £100. For more than that they would expect at least the poor stewardess to blow them. Any top down attempt to build a "just society" makes no sense. What is "just"? Even if you can define that, given the complexity of our society, do you know what are the steps to be taken to achieve your perfect world? Are you God or something, knowing all the variables out there and how they interact? "Yes, almost. I have Big Data, AI, super computers bla bla bla, and we live in a post scarcity society bla bla bla". If it's like that I'm really sorry my Lord, you are right, my bad for ever doubting on your powers and kindness, please rule over me and my fellow humans. Anyway, some jobs would be pushed to the black market, leaving the poorer, that you initially intended to protect, with less protection and guarantees. And what about those that are low skilled, they won't be able to gain access to the job market and to acquire the productivity and experience that could justify being paid 22 francs an hour one day.

37 points by dan_bk 12y ago

My personal thought on this topic: When you work at least 8 hrs/day, 5 days/week (because somebody wants your product/service), you should be able to have a normal/decent life. If not, you're simply being ripped off. EDIT: In other words, western societies have more than enough wealth for everybody to live really decent lives. If we still see horrible things like homelessness, etc., it's because society accepts structures that result in this. And personally, I don't want to be part of a society with such values.

dingaling 12y ago
One thought experiment I encourage everyone to try, even for a day, is to look at things you buy as a product of your locale's minimum wage. For example in the UK a lunchtime coffee is about 25 minutes 'worth' of min wage. A one-hour flying lesson is 25 minimum-wage-hours. Even a can of humble baked beans in sauce is five minimum-wage0minutes. It is very humbling.
- neosilky 12y ago
  I do this! Very good exercise for deciding if things are worth it.
- neosilky 12y ago
  I do this! Very good exercise for deciding if things are worth it.
ars 12y ago
Where's the money coming from though? Assuming no import/export (a false assumption of course) then increasing the minimum wage just increases costs, and you end up exactly where you started. There was a time when resources were a large percentage of the cost of good - those days are long gone, today wages are the largest part. You pay people more, so you have to charge people more, and they have more money so they can afford it so prices are successful in going up. Net result: Absolutely no change.
- dan_bk 12y ago
  > You pay people more, so you have to charge people more Or maybe some overpaid positions will have to accept a cut that they will never even feel in the slightest way. An INcrease of, say, $500/month to reach $4000/month can "change a World". But a $500/month DEcrease to reach i.e. $39'500/month will never even be felt. In economic terms: The marginal benefit of an increasing wage decreases. There is a fuzzy limit where more money does NOT make you more happy.
  - ma2rten 12y ago
    The problem with that is that there are much more workers than CEOs.
    - leaveyou 12y ago
      It's not such a big problem if you consider that many CEOs are paid well over 200x more than their nonsupervisor worker. http://go.bloomberg.com/multimedia/ceo-pay-ratio/ http://go.bloomberg.com/multimedia/ceo-pay-ratio/ http://www.businessweek.com/articles/2013-05-02/disclosed-the-pay-gap-between-ceos-and-employees http://www.businessweek.com/articles/2013-05-02/disclosed-th...
      - Zak 12y ago
        JCPenny, the company with the highest ratio on the first chart appears to employ about 117,000 people[0]. If the CEO gave up all his pay, they would be able to hire 1,795 more people - about 1.5%. Add together the top 20 and it's 18,860 people. Those same numbers likely apply to how many low-paid employees could be increased to around $15/hour[1]. In absolute terms, those sound like big numbers, but the US officially[2] has 9.8 million unemployed people[3] and a great many more working for low pay. 18860 more minimum wage jobs would be less than 0.2%. Flattening out the pay distribution in large companies may appeal to our sense of fairness, but it doesn't actually do much to alleviate poverty. [0] http://www.macroaxis.com/invest/ratio/JCP--Number_of_Employees http://www.macroaxis.com/invest/ratio/JCP--Number_of_Employe... [1] The underlying assumption being that most of these companies have a large number of minimum wage employees. [2] Unemployment numbers are skewed low because they don't count people who aren't following a specific pattern of job-seeking. [3] http://www.bls.gov/news.release/empsit.nr0.htm http://www.bls.gov/news.release/empsit.nr0.htm
yummyfajitas 12y ago
What basket of goods/services defines a "normal/decent life"? And what goods/services in the aforementioned basket do you believe people in the west are lacking?
grimtrigger 12y ago
> When you work at least 8 hrs/day, 5 days/week (because somebody wants your product/service), you should be able to have a normal/decent life. This is a fantasy. Imagine if I decide to become a human calculator, and that my job is going to be solving algebra problems. People will mail me simple problems (5+7) and I'll mail them back a solution. You might say "thats ridiculous! We have computers that can do that much more efficiently". Can I then argue "well, I work 8 hours a day! therefore I deserve a living wage"?.
- TallGuyShort 12y ago
  You're missing the part where they said "because somebody wants your ... service". No one would want your service, so why should you get a living wage for doing it? I still disagree with GP, however. If someone wants your service more than they want to keep a minimum wage worth of money, you could negotiate for that. The fact that so many people do not or cannot is proof that raising the minimum wage is at best an extremely short term solution, and we'll just have to keep raising it forever and ever to keep up with inflation. It doesn't magically start getting people what armchair politicians think people deserve.
  - pessimizer 12y ago
    Raising the minimum wage doesn't push up inflation like that.
bluedevil2k 12y ago
But why $25/hr? A 50 hour work week would bring in $62,000 a year. A married couple working "minimum wage" jobs would make over $120,000 a year. That's crazy. The "minimum wage" would put a couple in the top 10% of American household earners. Working backwards from a stated goal that a hard working Amarican married couple should be "middle class", and should make a middle class income of $60,000 (about what people consider middle class), working 50 hours a week equates to a minimum wage of $12/hr. (Given, my equation breaks down when considering unmarried parents, but it's a quick way to discuss what is the "ideal" minimum wage. If you work, you're middle class - if you choose not to work, that naturally results in lower income)
- Spiritus 12y ago
  Why would you calculate on a 50 hour work week? That's ~10 too much.
  - bhaak 12y ago
    The common Swiss work week is 42 hours. So it's "only" a 8 hours difference.
    - jellicle 12y ago
      42 paid hours?
      - bhaak 12y ago
        Yes, although if you work full-time, you are usually not paid by the hour, but have a fixed salary.
  - bluedevil2k 12y ago
    Too much by whose definition? What's wrong with the notion of "work hard and get a middle class life". The notion of "work the bare minimum and get an upper middle class life" won't have the same result.
Houshalter 12y ago
I agree, but what does that have to do with minimum wage? Raising the minimum wage doesn't necessarily raise people's income. If your labor is not worth more than $25/h to your employer you'll just lose your job (or never get hired in the first place.) Another problem is that the costs are not spread equally. An industry that employs a lot of low skill workers has to burden a huge amount of the cost of it, whereas a business that automates all their employees doesn't have to pay a dime. And those costs might pass on to consumers and cause problems, competing with different countries. The better alternative is a basic income (or some variation of it.) Tax everyone, not just the industries that employ lots of workers, include the unemployed in the benefits, and don't create artificial disincentives to hire people.
- dan_bk 12y ago
  > If your labor is not worth more than $25/h to your employer you'll just lose your job (or never get hired in the first place.) Well, you can always increase the number of jobs in a country by lowering the country's wages. By that logic, the taxpayer ends up footing the bill (via social insurance programs => taxes) that the employer should have paid.
  - Houshalter 12y ago
    Wages should be set by supply and demand like everything else. Taxpayers should pay for social programs, it spreads the cost out among the entire economy. Adding additional costs to a person, should a business decide to hire them, just discourages them from hiring and creates all the problems I mentioned above.
- pessimizer 12y ago
  >Raising the minimum wage doesn't necessarily raise people's income. If your labor is not worth more than $25/h to your employer you'll just lose your job (or never get hired in the first place.) What you're saying here is that raising the minimum wage doesn't necessarily cause a particular person's income to change at the same job that he/she had before. What it does is shift business models that depend on slave labor for their margins. It forces innovation and automation, and the people who can't acquire the skills needed can then rely on a basic income. I don't understand why the government subsidizes margins made on the backs of labor by supplementing their wages with welfare payments. If the government is supporting people, it should be reaping the benefits of their labor rather than private interests. If it can't come up with work that they can do, it should make sure that they're comfortable.
Zak 12y ago
Let's say I own a hotel and I'm trying to decide whether to have someone at the front desk taking check-ins and providing customer service 24 hours a day, or only 12 hours[0]. I will have to hire at least two people (full-time) or more (part-time) to accomplish this. I will only do this if the increase in business resulting from more flexible check-in times and better customer service will exceed the cost of hiring two more full-time employees. If a minimum wage is high enough that hiring these two people isn't profitable, I'll just stick to the restricted hours. Instead of being underpaid, the two people I would have hired are unemployed. Is that better? Of course, if I'm successful enough, I might be able to hire more people by reducing my own income or deferring other ways that I might re-invest in the business, but why would I do that if I'm running a business, not a charity? Any analysis of a specific minimum wage must consider the effect on unemployment. It's probably possible to calculate with a fair degree of precision - would someone with a background in economics like to chime in on this? [0] In the US, hotels without 24-hour check-in are rare; in Europe, they're common.
- pessimizer 12y ago
  Not having 24-hour check-in is probably the most efficient way to run things, depending on your location. What you're saying here is that employers may decide that feeding, clothing, housing, entertaining, and educating an entire human being is not worth it if you're then going to sit that person behind a check in desk overnight at a hotel in order to check a couple of late guests. That's probably a wise decision for most hotels. The only reason that they're not having to face it now is because the taxpayer is supplementing that wage with welfare payments. This discriminates against less labor intensive businesses, which don't get subsidy, and devalues investment in automation. People who can't find work that supports them should be on a basic income, and/or their labor should be used by the state. A basic income could also be a lever for direct stimulus to the economy during a demand crisis.
  - Zak 12y ago
    Without getting in to the merits of a basic income, the fact is Switzerland does not currently have one. Creating a high minimum wage without adding one would likely result in a large increase in unemployment.

ars 12y ago

I kinda hope it passes - it'll be a very interesting experiment. A disaster for Switzerland of course, but someone has to do the experiment. The best case scenario is a massive increase in cost of living, more likely is a huge increase in imports (since they are cheap now), together with a drop in exports (since no one can make anything affordable). That's not a good position for any country. But, maybe I'm wrong, that's why I kinda hope they do the experiment.

dan_bk 12y ago
> The best case scenario is a massive increase in cost of living I absolutely do not think so. Social justice is already excellent (compared to places like the US), wages have already a certain level allowing for an OK life (so not a lot of jobs would have to be cancelled due to higher pay), but it can definitely still be improved.
tonfa 12y ago
Given how the swiss usually vote this has no chance to pass. And FYI lots of countries are doing this "experiment" with decent minimal wages,Switzerland is more in exception among western countries than the norm. http://en.m.wikipedia.org/wiki/List_of_minimum_wages_by_country http://en.m.wikipedia.org/wiki/List_of_minimum_wages_by_coun...
- tonfa 12y ago
  And as a sidenote, while some European countries do not have a national minimum salary, most workers are covered by collective bargaining agreement (minimum wage per occupation/sector). This is the case in Switzerland, for example if you work in restaurant the minimum salaries are fixed, with a starting salary of 3600CHF/month if you don't have any diploma (http://www.gastrosuisse.ch/dbFile/282084/Salaires_minima__CCNT_2014.pdf http://www.gastrosuisse.ch/dbFile/282084/Salaires_minima__CC...).
jellicle 12y ago
I suppose it could happen your way, even though there has never been a "massive" increase in cost of living (or even a noticeable one) for any minimum wage increases ever studied in any country worldwide. I mean, you could drop a ball and have it fall upwards, too.

marincounty 12y ago

I don't know about a $25.00/hr wage, but one of the many brilliant things Switzerland does is ties fees/fines to income. So, if you are a rich man and get a speeding ticket, it will pay substantially more. I think they tie fees/fines to all aspects of working/living in Switzerland? A poor person who gets a $800 speeding ticket could become homeless. A rich person getting a expensive ticket is like getting decaf at Starbucks. People, will counter saying oh the rich pay more in income taxes. Yes-- in many cases, but I still feel fines/fees should be tied to a persons annual income. I feel it is so important it should be an admendment. I had a friend in college who dropped out after getting a $500 red light ticket. He wouldn't admit the ticket played a part in him dropping out, but I think it was a factor. I will always remember how he felt when that ticket arrived in the mail, while just finishing top ramen. He was a poor kid from an ethnic family. He was maxed out on loans and grants, and just always on the edge. Oh well, I hope you are doing well Max.

TallGuyShort 12y ago
I agree. People who tie this to income tax are viewing fines as revenue generators, which is wrong and harmful in so many ways. You're viewing fines as artificial incentives to obey the law. That view is more correct, IMHO, and your idea seems like a good way to apply the incentive evenly regardless of economic status.

Zarkonnen 12y ago

Seeing this thread made me remember to vote - with half an hour to spare. Thanks HN!

shirro 12y ago

I believe in a fair living wage but high wages often just mean high cost of living. Unless your purchasing power improves it is kind of pointless. Australia's minimum wage is double the USA but everything costs twice as much.

abalone 12y ago
Everything already costs twice as much in Switzerland. Check it: http://www.numbeo.com/cost-of-living/compare_countries_result.jsp?country1=Switzerland&country2=United+States http://www.numbeo.com/cost-of-living/compare_countries_resul...
- tandembike 12y ago
  Yes, but they have more purchasing power and a higher quality of life index (http://www.numbeo.com/quality-of-life/rankings_by_country.jsp http://www.numbeo.com/quality-of-life/rankings_by_country.js...).
- seanmcdirmid 12y ago
  International travel, computers, and cars cost about the same, however. Same as the Bay Area, living costs increase, but increasing purchasing power for those costs that don't increase.
girvo 12y ago
Not quite twice as much, but yes, much more expensive. Though we have excellent quality of life here (in my opinion). Where I get really peeved is that digital stuff and anything to do with tech often costs three, four times as much as overseas, for little to no reason. That pisses me off, to the point where I now use my VPS in Texas as a proxy to order things from overseas.

mkuhn 12y ago

So, first trends indicate that it will be rejected with 70 percent no votes. One reason that has been handed around to explain the no votes is that people do not want more regulation and think that this minimum wage would hurt more than it would help. Also: A large portion of people (90%+) already earn more than this minimum wage. [Update 13:42 CET] It now looks like it is going to be rejected with 77% of the vote. Quite a statement.

ojii 12y ago

For those interested in the results (and trends): http://www.wahlen.zh.ch/abstimmungen/2014_05_18/viewer.php?table=hochrechnung http://www.wahlen.zh.ch/abstimmungen/2014_05_18/viewer.php?t... (in German, but Google Translate does a decent job). TLDR, it's getting crushed, as expected.

us0r 12y ago
Is this an official government site or some polling/news site?

Dewie 12y ago

This seems like a silly title. Switzerland is already an expensive country to live in, so the minimum wage has to be pretty high compared to other places.

Kenji 12y ago

The vote doesn't make sense. If the Swiss people vote yes, the constitution will be updated with a law that the minimum wage per hour is 22 Swiss Francs. This is meaningless, considering that the constitution should be designed to hold for centuries. What are 22 Swiss francs in 100 years?

tonfa 12y ago
The number is indexed on price and salary changes (similar to retirement benefits).
jellicle 12y ago
A constitution is a set of documents that defines how a country runs at its most basic level. Not only should it not be designed to "hold for centuries", it should be easily adaptable to meet the needs of current inhabitants of the country. The decisions of people who lived hundreds of years ago have no power to bind people who live today. If your country is not making changes to its constitution on a regular, ongoing basis (every few years at most), it is certain that the constitution is not meeting the needs of most of the public.
- Kenji 12y ago
  "A constitution is a set of documents that defines how a country runs at its most basic level." I don't consider exact values in a currency the most basic level. This law is way too specific to make it into the constitution. Especially since it disregards geographic differences in income which are quite large (consider Zurich vs a tiny village somewhere)

lawl 12y ago

Swiss here. I want to highlight two problems in the proposal: > They argue that surviving on less than 4,000 francs a month is not possible because rents, health insurance and food are all prohibitively expensive. There are multiple problems with that. The first beeing that you can survive on less than 4000 francs a month. A few of my friends are doing it, and they live directly in the city of Zürich where flats and food is most expensive. They aren't living like kings, but they can afford a small appartment and a car. Seriously, that number is just too high. Okay, as a decent (senior) dev you'll get 8000 per month, in Zürich. But as a dev, you'll have a pretty good live in Switzerland in general, nevertheless, you can live on 3000 a month directly in Zürich if you can live with a one room flat. If you're on minimum wage you'll probably want to accept a 20 minute train ride and live a bit outside the city and get a larger flat. The second problem: If you're outside of Zürich/Geneva/$expensiveCity, with 4k/month you can probably afford a 4-room flat and a decent car. Seriously, the rent is the biggest issue here, you would have to set the minimim wage depending on where in Switzerland you live (i.e. minimum wage per canton, not for the whole country). If you're on minimum wage you probably don't have a huge selection of offers where you're going to work, or the option to work remote, so you need work near your flat. So if you have to work in Zürich on minimum wage, that would be just plain unfair. Having said that, I'm not against minimum wage, I just think the proposal is bullshit.

wiseignorant 12y ago

If they voted in favor, most Swiss would probably have to be considered morally inconsistent, because most of them will often cross the border with Italy, Germany or France just to have a nice meal at a restaurant (in Switzerland is already really expensive to the point of justifying the short trip). So in this case they would basically be saying that it's not ok to be paid less then 22 francs, but they are more than happy using a service where people earn much less than that. "But probably they will leave a huge tip for the staff in those countries". Well, I don't think so. In other words, as always, "it's easy to love 'humanity', but too damn hard to love the individual next to you", isn't it? Overall there is a lot of hypocrisy in those that support minimum wage, as a lot of them will say: "everybody should have a 'descent' wage", but then they are pretty happy buying cheap gadgets made by low paid Chinese people and using the remaining cash at their disposal for something else, maybe a nice trip for which they bought a low cost ticket, which is cheap also because the baggage handler doesn't get paid 22 francs an hour, not even that poor Ryanair stewardess earns that much money. But I'm sure many supporters of minimum wage would be outraged if their London-Lisbon return ticket cost more than £100. For more than that they would expect at least the poor stewardess to blow them. Any top down attempt to build a "just society" makes no sense. What is "just"? Even if you can define that, given the complexity of our society, do you know what are the steps to be taken to achieve your perfect world? Are you God or something, knowing all the variables out there and how they interact? "Yes, almost. I have Big Data, AI, super computers bla bla bla, and we live in a post scarcity society bla bla bla". If it's like that I'm really sorry my Lord, you are right, my bad for ever doubting on your powers and kindness, please rule over me and my fellow humans. Anyway, some jobs would be pushed to the black market, leaving the poorer, that you initially intended to protect, with less protection and guarantees. And what about those that are low skilled, they won't be able to gain access to the job market and to acquire the productivity and experience that could justify being paid 22 francs an hour one day.