Why is the minimum wage so low?

reply to post by Akragon


The reason is it would only raise the cost of living here in the states. The minimum wage is always just that, a minimum wage. Everyone who is in positions of responsibility would receive an equal bump is salary. All those wage increases would raise the cost of goods sold, and of course everything else sold.

Our Aussie friend spoke about their higher minimum wage, and they are 7th in the world with cost of living. While the United States is 27th. This means if you are an individual who can work hard, or educate yourself out of the entry level positions of our society you scale quicker to a better standard of living than someone in Australia on the same pay scale.

It also means that our 7.25 is actually on pare with around $10 there in purchasing power. Plus you have to take into account the value of the dollar trading on the market right now gives us less purchasing power, but allows for far more foreign investment. If our country were to change its monetary policy to a strong dollar, our purchasing power would even be more. However, our economy would like take a dive because it needs money coming back into it from the world to not contract.

The truth is the middle class loses the most out of a rise in the minimum wage. It gets pinched by the cost of goods and not a guaranteed raise. This actually reduces the size of the middle class. I predict a massive reduction of the middle class if the minimum wage were to hit $10 here. However, it is great for the stock market, because businesses can sell a $7 item for $10 and look like they are running a positive sales increase.

It also is brutal on small business, unless the dollars level out, and everyone sees they have more money and less purchasing power. That takes about a year.

www.numbeo.com...

reply to post by Akragon

I can and have lived off $15 an hour... quite comfortably

1) that depends on the state you're in, meaning...do you have state income tax, Sales tax? if the total combined taxes are 23% ...it begins to look very slim

2) What is the property taxes set at for commercial properties? (this is HUGE because it's what keeps rent high on apartments

3) What do you pay for you rent per month..? 200, 400, 600/month? do you share expenses with someone because where I live .. you can NOT touch a 1 bedroom (decent construction w/o cockroach infestation for LESS than 500/month.

4) What is your food expense? for a single person I'd say 300-400 /month and that might be calling it low

5) do you own a car or motorcycle? If the later, congrats, you get 30-40 mpg but with a old 1990's car with a 6 banger will get 15-20mpg, but then there's insurance....

Now, do I expect you to spread your life out in all this, certainly not, but I've been making 13-15/hr for 15+ years, as a single guy and as a married man, and it's brutal.

Spill the beans, tell us your favorite 'fishing hole' on how you manage to live comfortably in hopes that I / we can adjust our measly lifestyles to accommodate our income ..

Cuz' I haven't seen it and 15/hr does not add up in my books

reply to post by Komodo

Spill the beans, tell us your favorite 'fishing hole' on how you manage to live comfortably in hopes that I / we can adjust our measly lifestyles to accommodate our income ..

I live in Canada...

Akragon
reply to post by justreleased

 

I can blame the companies... IF you work at McD and make $10 an hour, while the CEO's of the company make millions every year... something is wrong there

If you havent noticed...America is in love with Stars. Sports stars make obscene amounts of money...move stars, music stars, and business stars...all make obscene amounts. Why? Because, as a group, we will not put our feet down and say enough is enough. I think it is horrendous the amount spent on college sports when the "supposed" reason for colleges to exist is to provide higher learning...not to be farm leagues for the pros.

Any successful business has someone at the top collecting money...

these companies choose to pay smaller wages because they're the only jobs available for some people... but if the rule was $15Hr across the board, their employees would be happier, which would give a bit of incentive to keep their jobs...

and again the money would be put back into the local business anyways

So...let's say the minimum wage is raised to $15/hr...what happens to the wages of those who were making 20% more than minimum wage prior to the change? What about 50% more etc. Basically pay, in general, is related to skills. Obviously a typesetter working at a printing firm should make more than an entry level position at Mickey D's, right?

So...after minimum wage is increased to 15, everyone else's income would increase proportionally. What happens then? The cost of products and services would similarly rise resulting in $15 having approximately the same buying power as the previous minimum wage...

In fantasy land those making the new wage would be able to live at a much higher standard of living. Unfortunately this is not fantasy land. Everything has it's consequences...if you make no attempt to understand what they may be, then....

Personally, I kinda hope they do increase it by a ridiculous amount then people could learn a lesson about how economics works...a small but valuable lesson. But something tells me that those making $15 would just demand another increase.

reply to post by bbracken677

Oh...and let's not even discuss the effect would be on manufacturing jobs moving overseas.

Instead of focusing on inflationary tactics to increase buying power, we should look hard and long at taxation, at regulation, at public (govt) spending ... in short we should look very hard at our leaders.

Increasing the supply of money by historically massive and unprecedented amounts is not helping the plight of the poor. Not accurately recording and reporting true inflation is not helping anyone. Inflation at 3-4%? Really? I cry BS. Failing to address the problems, or even acknowledging they exist, seems to be what our govt does.

ShadeWolf
reply to post by Hoosierdaddy71

 

Alright, let's go with that. Replace simple labour with machines, it's coming soon anyways. A massive segment of the population is now out of work and has no options. What happens then? Guess what: you get a bunch of hungry people who are dissatisfied with the socioeconomic system together, and I guarantee you blood is going to be spilled.

The solution? Force socioeconomic adaptation to increasing automation and the simple fact that there are more people than jobs. At this point, the basic necessities of life should be flat-out provided to everyone by law. Food, shelter, medicine, things someone living in a civilized country should not have to work for.

Number 1, with automation comes new jobs: robots will need to be manufactured, robots will need maintenance and operators. I worked in a manufacturing plant for over 20 years...as automation came on board we didnt reduce our labor staff. We provided the training to operate the "robots" (someone has to operated them) and we added skilled maintenance positions to maintain them.

Bottom line result was more skill and training required by those working there and higher income levels. Another result, that supported the higher wages was increased productivity. Another result, those who once had to perform back breaking labor were no longer having to work hard...they had to work smarter.

Oh...and who decided we should not have to work for food, shelter and medicine? Are you prepared to have a major portion of your income going to non-productive members of society? Really? Or do you feel that way because you wish to be one of those unproductive members?

If food, shelter and medicine are free...then what is the incentive to work? I wonder if that is why there is such a market for illegals? They are willing to work, whereas a huge segment of our society would rather sit back and collect welfare rather than work.

If you are not willing to take their jobs, then the market for their jobs (the illegals) will continue.

Free food, shelter and medicine for all simply will not work since there will be so many who will be content to sit back and do nothing....

Akragon
reply to post by Komodo

 

Spill the beans, tell us your favorite 'fishing hole' on how you manage to live comfortably in hopes that I / we can adjust our measly lifestyles to accommodate our income ..

I live in Canada...

edit on 27-1-2014 by Akragon because: (no reason given)

ah ha !!!

I knew there was a reason I want to live there ! LOL ..

Akragon
I can and have lived off $15 an hour... quite comfortably

Yeah... not around here in Massachusetts. You'd be hard-pressed to find even a studio apartment for less than $1000/month in this state, and that's not including utilities.

Massachusetts is definitely a place where single people need to make a significant paycheck to survive independently, and co-habitating couples would certainly each need to make a decent wage in order to flourish.

I've been working on my wife for a few years now to get her to be willing to leave the state, but as of yet, I've been unsuccessful. I guess I'll just have to wait until we're facing homelessness before she'll consider leaving this mess of a state.

Akragon

Now with a quick google search one would find the minimum wage in the US is $7.25... I would assume that is almost impossible to live off of but im sure people make it work...

It isn't meant to live off of. It's meant to be for the lowest skilled workers. They then become more skilled and make more money.

Personally... I think the minimum wage should be $15.00 an hour across the board... It would stimulate the economies of the world because people would have the money to buy more things and live comfortably...

So, what if someone who is skilled is making $15/hr now? Will they get a corresponding 100% raise to reflect the value of their work? Do you know how much a degreed bookkeeper (like my wife) is hired for on average? $19 an hour. That's with a Bachelor's degree. That means they are valued at ~270% of minimum wage. Will a bookkeeper get a raise to $40/hr? No, no they won't, because the market assigns a price to labor, and low-skilled labor has low value. That's why the minimum wage is "low".

/TOA

m.thestar.com...#!/news/redirect/6b5d7fc3c32f04cb951072d91a81a44c

Ontario minimum wage goes up June 1 to $11

It's a start. No mention yet of when the other provinces will follow.