Anonymous wrote:

Anonymous wrote:OP, it's not going to go well for your wife if she requests a 50% raise and cites increased minimum wage as the reason.

What is her job?

Why wouldn't it go well? She will now only make a few dollars more per hour than a high school kid who pushes carts at a grocery store. She's an administrator in HR.

Anonymous wrote:I think it’s a valid question that someone with no higher education gets 15/hr that the hourly rate for those with degrees should make more. 15/hr to lift those out of poverty while working full time is long over due, but continuing to pay those with degrees and expansive experience a few bucks more is absurd. Zero reason a college graduate with a master should be making 25/hr.

Anonymous wrote:

[Post New]01/20/2021 08:02 Subject: Re:How much raise should my wife ask for now with Biden and $15/h minimum wage? [Up]
Anonymous



Anonymous wrote:

You people fail to grasp basic economics. An increase in minimum wage puts pressure on all pay. Do you all think the prices of goods and housing will remain the same? Of course not. If labor goes up prices go up and we all end up back in the same boat again. Of people can afford more house that's what they will do. It has the exact same impact low interest rates have had on housing the more money people can spend on housing the more they will. However it's not like housing conditions get any better as a result. Many people at this point are living in shit shacks.


Of course this is exactly how it works. Even when the grumblings of a minimum wage increase in MoCo was coming through years ago, I sat on the board of a directors at a company where our hiring suddenly became more expensive and more difficult. The company was in an industry that pays relatively lower wages because many of the workers are not very skilled. But OPs argument was exactly what numerous potential hires and current employees kept saying - "eventually minimum wage is going to be $15 so I'm not working for $16." Keep in mind this was 2016 or so where the minimum wage was still around $11. So, it doesn't even actually require an ACTUAL increase in minimum wage to drive wages up and make hiring difficult at higher levels. I have a friend in another state where they are contemplating raising the minimum wage significantly. When they do so, he will be in a similar position as OPs wife. He coincidentally also works as university staff. He literally told me last year, "if I had known this is what would happen with minimum wage, I don't think I ever would have gone to college." The absurd increase in the minimum wage is going to have a variety of unintended negative consequences. That's not to say there won't also be positive consequences - of course it's good that somebody can work a job and afford food and rent. But, the question is, how long will it take for that person to be replaced by an LCD touch screen or a computer? As for me, yes, I do think that if I was making 10 times what the janitors were and now I will only be making 5 times what the janitors are, yes I also expect a raise. Sorry that's just life.



sorry, but real economists do not agree with you. this is not how it works. I only took a handful of econ classes with Alan Krgueger but even back then he showed that the neoclassical model was just that, a model and real world data disproved it.

The other thing you are all missing is that you are focused on raising other wages (lets call them median wages for now) if the minimum wage goes up. but what has actually happened over the past 50 years is that the gap between minimum and median has increased hugely. Median wages have risen while minimun have not. You were all okay with making more money even as the working poor stagnated, but now that there's an attempt at rectifying this situation, making it more equal, you want your wages raised to track. The rising tides of the middle and upper class did not rise the boats on the bottom, and now that someone wants to rescue them from sinking you think, no way, not unless my boat rises too.

If you really want to increase the quality of life and your economic power, you should be voting for politicians who will do away with the huge corporate tax cuts and instead put funds toward universal health care and college which will not only equalize things but address the very high costs of health care that businesses currently bear as well as insane college and health care costs that middle class families shoulder, despite having a good income. It will also create a healthier society and stronger communities, which benefits all of us, esp employers.




Buddy, you're talking to a PhD in economics, although I don't focus on labor. But here's an AER just from a year ago showing substitution of capital for labor and lower employment in industries where they can't pass costs to consumers: https://www.aeaweb.org/articles?id=10.1257%2Faer.20171445&&from=f

But keep trotting out the undergrad econ, it's very enjoyable

Right, then you understand that there are major debates in the field of ecoomics and a single study in Hungary is not necessarily the model for the US. But I dont need to tell you because I'm sure you've also read Dube, who is one of the major voices in this field. Here's a far broader study, focused on the US, which suggests the opposite.

https://academic.oup.com/qje/article/134/3/1405/5484905

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I'm not sure policy makers realize how devastating this can be for depressed cities, especially former industrial towns. I live in one and it declined majorly 20 years ago as factories shut down. Now they are building up again as distribution centers for online retailers (we have 5 major retailers doing it here so far) open up, as well as assembly plants for major automakers. What draws these new businesses here is that the wages here are low -- below $15/hour -- for entry-level, and we're near major interstates. However, our minimum wage is a good wage because cost of living is low here. Cost of living is easily half of in DC where we used to live.

If the minimum wage goes to $15/hr nationwide, then suddenly our town is no longer attractive to employers as being low-cost, and the jobs will start disappearing. There are a million towns also along the interstate where they can put their next warehouse.

If the goal is to make sure households earn enough to live, then we should index the minimum wage in that area to cost of living, or even better just adjust the earned income tax credit (EITC). The EITC takes into account total household income, particular since people may work more than one job, and also household size, like number of children at home.

I know $15/hr is a great soundbite, but I'm pretty sure it's going to leave towns like ours worse off.

+1, I’d much rather see a more generous EITC.

-1. I'm also from an economically depressed area, with a low COLA, and initially thought like you did. My hometown is among the Top 10 low-income cities. Then I looked up the studies that are by city, and show the actual cost of what you'd need to afford an apartment in various cities across the country. Even in my very hometown, you need $15/hour unless you are living with a 2-income household in a 1-bedroom or 2-bedroom apartment with no childcare costs. Those people taking the $11/hour jobs are only making it work because they are relying on food stamps, leaving their kids with random relatives (know someone back home who regularly left their preschoolers with cartoon network and a drunk aunt), etc. $15 is the number people use because the people have studied this have figured that it's basically what you need almost anyplace. I'm sort of sick of big companies making the rest of us subsidize their failure to pay workers a living wage while they pay their C-suite 8 figure salaries. Aren't you?

[Post New]01/20/2021 08:02 Subject: Re:How much raise should my wife ask for now with Biden and $15/h minimum wage? [Up]
Anonymous



Anonymous wrote:

You people fail to grasp basic economics. An increase in minimum wage puts pressure on all pay. Do you all think the prices of goods and housing will remain the same? Of course not. If labor goes up prices go up and we all end up back in the same boat again. Of people can afford more house that's what they will do. It has the exact same impact low interest rates have had on housing the more money people can spend on housing the more they will. However it's not like housing conditions get any better as a result. Many people at this point are living in shit shacks.


Of course this is exactly how it works. Even when the grumblings of a minimum wage increase in MoCo was coming through years ago, I sat on the board of a directors at a company where our hiring suddenly became more expensive and more difficult. The company was in an industry that pays relatively lower wages because many of the workers are not very skilled. But OPs argument was exactly what numerous potential hires and current employees kept saying - "eventually minimum wage is going to be $15 so I'm not working for $16." Keep in mind this was 2016 or so where the minimum wage was still around $11. So, it doesn't even actually require an ACTUAL increase in minimum wage to drive wages up and make hiring difficult at higher levels. I have a friend in another state where they are contemplating raising the minimum wage significantly. When they do so, he will be in a similar position as OPs wife. He coincidentally also works as university staff. He literally told me last year, "if I had known this is what would happen with minimum wage, I don't think I ever would have gone to college." The absurd increase in the minimum wage is going to have a variety of unintended negative consequences. That's not to say there won't also be positive consequences - of course it's good that somebody can work a job and afford food and rent. But, the question is, how long will it take for that person to be replaced by an LCD touch screen or a computer? As for me, yes, I do think that if I was making 10 times what the janitors were and now I will only be making 5 times what the janitors are, yes I also expect a raise. Sorry that's just life.



sorry, but real economists do not agree with you. this is not how it works. I only took a handful of econ classes with Alan Krgueger but even back then he showed that the neoclassical model was just that, a model and real world data disproved it.

The other thing you are all missing is that you are focused on raising other wages (lets call them median wages for now) if the minimum wage goes up. but what has actually happened over the past 50 years is that the gap between minimum and median has increased hugely. Median wages have risen while minimun have not. You were all okay with making more money even as the working poor stagnated, but now that there's an attempt at rectifying this situation, making it more equal, you want your wages raised to track. The rising tides of the middle and upper class did not rise the boats on the bottom, and now that someone wants to rescue them from sinking you think, no way, not unless my boat rises too.

If you really want to increase the quality of life and your economic power, you should be voting for politicians who will do away with the huge corporate tax cuts and instead put funds toward universal health care and college which will not only equalize things but address the very high costs of health care that businesses currently bear as well as insane college and health care costs that middle class families shoulder, despite having a good income. It will also create a healthier society and stronger communities, which benefits all of us, esp employers.




Buddy, you're talking to a PhD in economics, although I don't focus on labor. But here's an AER just from a year ago showing substitution of capital for labor and lower employment in industries where they can't pass costs to consumers: https://www.aeaweb.org/articles?id=10.1257%2Faer.20171445&&from=f

But keep trotting out the undergrad econ, it's very enjoyable

Anonymous wrote:

Anonymous wrote:There is no right to run a small business that ultimately relies on the state to subsidize your employees because the business doesn't generate enough profit. If you can't afford to pay employees minimum wage, then maybe you need a new business plan.

Nope. Not when the rules change overnight.
If you rely on your theory, be happy to pay $12 for a coffee.

Anonymous wrote:

Anonymous wrote:There is no right to run a small business that ultimately relies on the state to subsidize your employees because the business doesn't generate enough profit. If you can't afford to pay employees minimum wage, then maybe you need a new business plan.

Nope. Not when the rules change overnight.
If you rely on your theory, be happy to pay $12 for a coffee.