OT: Minimum wage proposal in SD

[no_such_reality]

[quote=EconProf]Good point JohnAlt. There seems to be an automatic assumption among advocates of minimum wage hikes that all low paid workers are exploited. The fact is that their productivity tends to be low, so their contribution to the firm does not justify an arbitrary wage hike dictated by the government. However, once they prove themselves through experience, promptness, learning, etc., a rational, profit-maximizing boss will pay accordingly (or risk losing them to a competitor). That’s our market system, greatly simplified.[/quote]

It’s a simpler discussion when you realize the beneficiary of minimum wage isn’t the worker, it’s the community the worker is in.

JMHO, a living wage prevents the kind of low expectation sprawl that prevents real innovation and opportunity for entrepreneurs and want to be SMBs. Whether food truck or furniture, its niche trendy expensive or walmartesque commodity.

[EconProf]

Actually, a high minimum wage hurts the community, in that it does not allow upward mobility, ie, first job, that we all want those youths to have. Again, it is the seen vs the unseen. We will never know how many youths who are capable and eager to work and learn will not get their first job where they can prove themselves.
Employers have an array of applicants of varying qualifications and experience to pick from when they advertise an opening. Why should they take a chance on someone who has never had a job and maybe has other strikes against him/her for that $13.09/hour job within the San Diego city limits?

[Hobie]

1. If employers are forced to pay higher minimum, do you think there will be raises soon? To me it is a salary cap.

2. Costco pays its cashiers $20+/hr. w/ stock options. Cashiers… beep… beep…

3. I am constantly miffed when at a drive thru and I can’t understand the order taker. This min wage stuff business is sparking a better order entry system. Carl’s already tried it with a kiosk. Fail, but when it is perfected, look out min wage, poor english speaking order takers.

[utcsox]

[quote=AN][quote=urbanrealtor]
Who works at min wage jobs now?[/quote]
The largest group of min wage workers are in households making $100-200k/year.The largest group of min wage workers are in households making $100-200k/year. Majority of min wage workers are <25 years old. As I said in my earlier post, raising minimum wage by that much will definitely give a big boost to automation. [/quote]

Seriously? The largest group of min wage workers are in households making $100-200k/year Do explain.

[utcsox]

[quote=urbanrealtor][quote=EconProf]We economists are largely in agreement about raising the minimum wage: it will kill jobs.
The recently proposed mild increase in the federal minimum wage would cost about a half-million jobs, according to federal officials.
But the huge jump to $13.09 for San Diego only would have a far more powerful impact on employment within our city limits.[/quote]
Also, I think referring to yourself as “we economists” is a wee bit of a stretch.[/quote]

“we economist from the right” …

[CA renter]

[quote=JohnAlt91941][quote=CA renter][quote=EconProf][quote=The-Shoveler]

You’re also making the erroneous assumption that all added costs would be passed on to the consumer. Guess what? Profit margins are at all-time highs. There is no economic law that states that profit margins should always remain the same or grow over time. Time for workers to finally get a greater share of the profits that they’ve created in the first place.[/quote]

Yeah, like the workers have risked the capital to start a business. Workers are free agents who either agree or not to work for a certain amount in a free market.

If their skills demanded $13 an hour they would be getting it already.[/quote]

Under no circumstances is our labor market a free market. Business interests are constantly lobbying to relax labor, immigration, and other laws that would benefit workers. If we had a free labor market, all compensation for every position would be public knowledge, and labor would have as much say in politics (including tax and trade agreements) as corporations do. Only delusional people would ever think that our labor market is a free market. It’s one of the most manipulated markets in our country.

[an]

[quote=utcsox][quote=AN][quote=urbanrealtor]
Who works at min wage jobs now?[/quote]
The largest group of min wage workers are in households making $100-200k/year.The largest group of min wage workers are in households making $100-200k/year. Majority of min wage workers are <25 years old. As I said in my earlier post, raising minimum wage by that much will definitely give a big boost to automation. [/quote]

Seriously? The largest group of min wage workers are in households making $100-200k/year Do explain.[/quote]
Kids.

[Reality]

[quote=CA renter]

Under no circumstances is our labor market a free market. Business interests are constantly lobbying to relax labor, immigration, and other laws that would benefit workers. If we had a free labor market, all compensation for every position would be public knowledge, and labor would have as much say in politics (including tax and trade agreements) as corporations do. Only delusional people would ever think that our labor market is a free market. It’s one of the most manipulated markets in our country.[/quote]

It’s as free as there is. Minimum wage is a manipulation, and it can’t create jobs. It only encourages the opposite.

[ltsddd]

[quote=AN][quote=utcsox][quote=AN][quote=urbanrealtor]
Who works at min wage jobs now?[/quote]
The largest group of min wage workers are in households making $100-200k/year.The largest group of min wage workers are in households making $100-200k/year. Majority of min wage workers are <25 years old. As I said in my earlier post, raising minimum wage by that much will definitely give a big boost to automation. [/quote]

Seriously? The largest group of min wage workers are in households making $100-200k/year Do explain.[/quote]
Kids.[/quote]

Mostly young folks between 16-24 as shown here
http://www.pewresearch.org/fact-tank/2013/07/19/who-makes-minimum-wage/

and here

http://www.heritage.org/research/reports/2013/02/who-earns-the-minimum-wage-suburban-teenagers-not-single-parents

Care to show where you get the assertion that “The largest group of min wage workers are in households making $100-200k/year”?

[an]

Can’t find my source anymore. I remember seeing something like ~30% of minimum wage earners have house hold income between $100-200k. But I don’t remember what the other distributions are. Since I can’t find my source anymore, I’m concede the point, unless I can find it again. Regardless of this point, I still stand by my main point, which is raising minimum wage to $13 or higher will only kick automation into high gear. If anything, this will create a job boom for people like me. Also, wage inflation usually follow by rent/housing inflation as well. So, definitely, bring it on.

Some more demographic data of minimum wage worker, the largest minimum wage workers are kids <25 years old, 31% are between 16-19, 53% works <29 hours, 38.9% works <14 hours, 36% doesn't even have a HS diploma, etc.
http://www.bls.gov/cps/minwage2012tbls.htm#4

You should also ask yourself, what about all the other people who are making more than minimum wage but <$13? would they also start making more than $13? Would they also get a 60% raise as well? Then how about all the other workers? Wouldn't/shouldn't this trigger a massive wage inflation for everyone? Just to be clear, I'm not against this at all. I stand to hopefully benefit from this, so I'm all for it. I'm just trying to point out what might be the side effect of it.

[CA renter]

[quote=JohnAlt91941][quote=CA renter]

Under no circumstances is our labor market a free market. Business interests are constantly lobbying to relax labor, immigration, and other laws that would benefit workers. If we had a free labor market, all compensation for every position would be public knowledge, and labor would have as much say in politics (including tax and trade agreements) as corporations do. Only delusional people would ever think that our labor market is a free market. It’s one of the most manipulated markets in our country.[/quote]

It’s as free as there is. Minimum wage is a manipulation, and it can’t create jobs. It only encourages the opposite.[/quote]

Minimum wage is less of a manipulation than “free trade” agreements or “immigration reform” laws that send work to foreign lands where there are few/no labor or environmental protections, or workers who have no protections to our country.

Minimum wage laws are less of a manipulation than intellectual property/patent laws.

Minimum wage laws are less of a manipulation than limited liability laws.

[EconProf]

Politicians often pass laws that ignor the resulting effects on incentives. Cost-conscious businesses naturally react to a suddenly higher input cost (labor) by substituting another input that is unchanged in cost (capital). Self-checkout lines at stores are one of many examples.
The process of ordering and picking up food at both restaurants and fast-food places is labor-intensive and ripe for automation, and a jump to $13.09/hour in San Diego would incentivize owners to quickly replace workers with machines.
In europe, with much higher minimum wages, automation in food establishments is already farther along than here.

[XBoxBoy]

[quote=EconProf]We economists are largely in agreement about raising the minimum wage: it will kill jobs.[/quote]

Keeping in mind how great a track record the consensus of economists has… The fact that economists agree on something sounds to me like a pretty good indicator that the idea is completely wrong. Just sayin…

[SK in CV]

[quote=EconProf]We economists are largely in agreement about raising the minimum wage: it will kill jobs.
[/quote]

No, we economists are NOT largely in agreement that it will kill jobs. There is little evidence that it ever has before. At very best, economists have no f’ing clue whether it will kill jobs. At worst, they know exactly what will happen.

A plurality of economists think that the costs of raising the minimum wage are outweighed by the benefits.

At least 600 phd economists think that increases in the minimum wage “have had little or no negative impact on employment of minimum-wage workers:

In recent years there have been important developments in the academic literature on the effect of increases in the minimum wage on employment, with the weight of evidence now showing that increases in the minimum wage have had little or no negative effect on the employment of minimum-wage workers, even during times of weakness in the labor market. Research suggests that a minimum-wage increase could have a small stimulative effect on the economy as low-wage workers spend their additional earnings, raising demand and job growth, and providing some help on the jobs front.

Over 600 Economists Sign Letter In Support of $10.10 Minimum Wage: Economist Statement on the Federal Minimum Wage

[EconProf]

[quote=SK in CV][quote=EconProf]We economists are largely in agreement about raising the minimum wage: it will kill jobs.
[/quote]

No, we economists are NOT largely in agreement that it will kill jobs. There is little evidence that it ever has before. At very best, economists have no f’ing clue whether it will kill jobs. At worst, they know exactly what will happen.

A plurality of economists think that the costs of raising the minimum wage are outweighed by the benefits.

At least 600 phd economists think that increases in the minimum wage “have had little or no negative impact on employment of minimum-wage workers:

In recent years there have been important developments in the academic literature on the effect of increases in the minimum wage on employment, with the weight of evidence now showing that increases in the minimum wage have had little or no negative effect on the employment of minimum-wage workers, even during times of weakness in the labor market. Research suggests that a minimum-wage increase could have a small stimulative effect on the economy as low-wage workers spend their additional earnings, raising demand and job growth, and providing some help on the jobs front.

http://www.epi.org/minimum-wage-statement/%5B/quote%5D
Economists range from far right to far left, so the fact that the Economic Policy Institute could find 600 economists, out of tens of thousands, to support a minimum wage increase does not say a lot.
I noticed that those 600 included some distinguished notables as well as junior college instructors.
Please remember that I said economists are “largely in agreement” about the harmful effects of a minimum wage hike–meaning a majority. SK carefully says a “plurality” of economists favor a hike–meaning a minority. Glad we agree on that.
And let’s take a closer look at that neutral-sounding Economics Policy Institute. Turns out it is headed up by Richard Trumpka, head of the AFL-CIO. And ten of the Board of Directors are union heads. Nothing suspicious there.

[Author]

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