the minimum wage: reality check
- Thread starter Taichiliberal
- Start date
Taichiliberal
Shaken, not stirred!
Another selfish, stupid self absorbed neocon asshole advocating his economic darwinism without a clue of reality
Here stupid http://www.payscale.com/research/US/Job=Cook,_Short_Order/Hourly_Rate
Woo-hoo $2 bucks above the minimum....yeah, let's put a down payment on that Lexus!
You idiot!
canceled.2021.1
#AMERICAISDEAD
You really do seem like you care deeply about this issue. I really hope it isn't causing you to lose sleep
cawacko
Well-known member
The minimum wage argument isn't a new one obviously. I like the angle that it is viewed from in this article.
Minimum Wage Laws Are Barriers to Employment
Minimum wage laws are much in the news these days. New York, California and various US cities have recently enacted legislation to raise minimum wage requirements to $15 an hour. In this context it is especially worthwhile to revisit the purpose and effect of minimum wage laws.
Two policy questions are closely connected to the minimum wage debate:
1Whether government should ensure that workers receive no less than a certain amount of compensation for their labor; and
2Whether government should establish a price barrier to employment, and if so how high it should be.
The minimum wage debate is often reported as though it is about the first of these two policy issues. It is actually about the second.
If society’s pertinent policy objective were to ensure that workers receive a minimum level of support for their labor, we would almost certainly pursue this objective very differently than through minimum wage laws. Federal or state governments could provide direct income support to workers, which could be designed to be a function of their employment earnings or even of total work hours. Society could make a transparent value judgment about how to balance the income needs of workers with the level of support others are willing to finance. The costs of this support could be broadly distributed among all taxpayers rather than concentrated on certain business activity. Importantly, such a policy would not create direct barriers between low-income workers and jobs.
Thus we don’t enact minimum wage laws primarily to ensure income adequacy for workers, which could be done in less problematic ways. The more accurate way to think of minimum wage law is as a government decision to prohibit low-wage employment. Such law expressly prevents an employer from hiring a worker for a job earning less than the legislated minimum wage, even if that worker would otherwise consider it in his/her interest to accept it.
Government does not and cannot compel employers to hire workers and pay them a given wage. What government does instead through minimum wage laws is to prohibit employment at lower wages. There is no guarantee that every job made illegal by this prohibition will be replaced by another higher-paying one. Indeed it is a virtual certainty that at least some jobs will not be.
Thus, minimum wage laws reduce employment. Even without an advanced mastery of economics it is easy to understand how. If the price of something (in this case labor) is raised, a purchaser (in this case a potential employer) is not only less willing but less able to buy it. To construct a deliberately extreme example; if you could hire a plumber for $1 to unplug your drain, you would probably be delighted to do so. If instead the government required that you pay a plumber $10,000 to unplug it, you would almost certainly find a way to just do it yourself. The job would simply be eliminated. It is difficult to say for certain where this line is crossed for every job – but every job has such a line. Minimum wage laws push the lowest-skill workers from the employable to the unemployable side of that line.
There is a debate among economists as to how large a minimum wage increase must be before it creates an unambiguous, measurable adverse impact upon jobs. Advocates of minimum wage increases often cite academic research by Alan Krueger and David Card suggesting that specific past minimum wage increases did not lead to increased unemployment. But most academic research reaches the expected conclusion that minimum wage laws do reduce jobs, including research by Jeffrey Clemens, David Neumark and Jonathan Meer. Even Krueger recently editorialized that raising the minimum wage to $15 an hour would “risk undesirable and unintended consequences.” Thus economists widely agree that raising the minimum wage lowers employment; the only serious arguments are about when the effect is large enough to be discoverable.
None of this is to denigrate the motives of those who advocate raising such barriers to employment. To some eyes it is a form of exploitation if work is performed for pay below a certain level. Returning to our example of the plumber; some might regard it as unacceptably unfair to pay him only $1 to unplug your drain – holding this viewpoint so strongly that they would forbid the two of you from mutually agreeing to the transaction. That the job might simply be eliminated strikes some as an acceptable price to prevent this perceived exploitation. The same logic holds that it would be preferable for a person to remain unemployed than to perform a low-wage job at, for example, Walmart or McDonald’s.
This means however that minimum wage laws inevitably price some workers out of the job market. Workers most vulnerable to displacement include those with the weakest job skills, perhaps because they lack sufficient education or training, or because they are young workers just entering the job market. Specific sectors such as the restaurant business often operate with thin profit margins that leave them little room to adjust to sudden changes in their labor costs other than by eliminating jobs.
An underrated problem with pricing low-skill workers out of the job market is that their earnings losses are not limited to their period of unemployment. It is usually while holding a job that an individual acquires the skills necessary to achieve higher future earnings. It is therefore usually better for that individual to be employed for a low wage than not to be employed at all. This too is widely recognized. A working paper from the Boston Fed recently found that “the earnings of displaced workers do not catch up to those of their nondisplaced counterparts for nearly 20 years.” As the paper further states, “the longer a worker is unemployed, the more his or her skills. . . depreciate, making the worker less valuable to a new employer.”
This effect is of particular concern right now when young adults – those most often harmed by minimum wage increases -- are falling out of the workforce in rising numbers. No one knows for sure why this is happening, but the effect on these workers will be lower earnings for many years to come. This trend, as seen in Figure 1 reproduced from the St. Louis Fed, should give lawmakers pause before erecting further barriers to employment.
Figure 1: Labor Force Participation Rate for Workers Age 20-24, 2006-16
Labor Force Participation- FRED
It is appropriate for lawmakers to consider policies to raise worker living standards, including the compensation they receive for their labor. The amount of income support low-wage workers should receive beyond the amount they can freely earn is an important societal value judgment. However, it is a separate value judgment from whether and where to set a minimum wage, which is instead effectively a decision about how stringently to prohibit individuals from working.
http://economics21.org/html/minimum-wage-laws-are-barriers-employment-1776.html
Minimum Wage Laws Are Barriers to Employment
Minimum wage laws are much in the news these days. New York, California and various US cities have recently enacted legislation to raise minimum wage requirements to $15 an hour. In this context it is especially worthwhile to revisit the purpose and effect of minimum wage laws.
Two policy questions are closely connected to the minimum wage debate:
1Whether government should ensure that workers receive no less than a certain amount of compensation for their labor; and
2Whether government should establish a price barrier to employment, and if so how high it should be.
The minimum wage debate is often reported as though it is about the first of these two policy issues. It is actually about the second.
If society’s pertinent policy objective were to ensure that workers receive a minimum level of support for their labor, we would almost certainly pursue this objective very differently than through minimum wage laws. Federal or state governments could provide direct income support to workers, which could be designed to be a function of their employment earnings or even of total work hours. Society could make a transparent value judgment about how to balance the income needs of workers with the level of support others are willing to finance. The costs of this support could be broadly distributed among all taxpayers rather than concentrated on certain business activity. Importantly, such a policy would not create direct barriers between low-income workers and jobs.
Thus we don’t enact minimum wage laws primarily to ensure income adequacy for workers, which could be done in less problematic ways. The more accurate way to think of minimum wage law is as a government decision to prohibit low-wage employment. Such law expressly prevents an employer from hiring a worker for a job earning less than the legislated minimum wage, even if that worker would otherwise consider it in his/her interest to accept it.
Government does not and cannot compel employers to hire workers and pay them a given wage. What government does instead through minimum wage laws is to prohibit employment at lower wages. There is no guarantee that every job made illegal by this prohibition will be replaced by another higher-paying one. Indeed it is a virtual certainty that at least some jobs will not be.
Thus, minimum wage laws reduce employment. Even without an advanced mastery of economics it is easy to understand how. If the price of something (in this case labor) is raised, a purchaser (in this case a potential employer) is not only less willing but less able to buy it. To construct a deliberately extreme example; if you could hire a plumber for $1 to unplug your drain, you would probably be delighted to do so. If instead the government required that you pay a plumber $10,000 to unplug it, you would almost certainly find a way to just do it yourself. The job would simply be eliminated. It is difficult to say for certain where this line is crossed for every job – but every job has such a line. Minimum wage laws push the lowest-skill workers from the employable to the unemployable side of that line.
There is a debate among economists as to how large a minimum wage increase must be before it creates an unambiguous, measurable adverse impact upon jobs. Advocates of minimum wage increases often cite academic research by Alan Krueger and David Card suggesting that specific past minimum wage increases did not lead to increased unemployment. But most academic research reaches the expected conclusion that minimum wage laws do reduce jobs, including research by Jeffrey Clemens, David Neumark and Jonathan Meer. Even Krueger recently editorialized that raising the minimum wage to $15 an hour would “risk undesirable and unintended consequences.” Thus economists widely agree that raising the minimum wage lowers employment; the only serious arguments are about when the effect is large enough to be discoverable.
None of this is to denigrate the motives of those who advocate raising such barriers to employment. To some eyes it is a form of exploitation if work is performed for pay below a certain level. Returning to our example of the plumber; some might regard it as unacceptably unfair to pay him only $1 to unplug your drain – holding this viewpoint so strongly that they would forbid the two of you from mutually agreeing to the transaction. That the job might simply be eliminated strikes some as an acceptable price to prevent this perceived exploitation. The same logic holds that it would be preferable for a person to remain unemployed than to perform a low-wage job at, for example, Walmart or McDonald’s.
This means however that minimum wage laws inevitably price some workers out of the job market. Workers most vulnerable to displacement include those with the weakest job skills, perhaps because they lack sufficient education or training, or because they are young workers just entering the job market. Specific sectors such as the restaurant business often operate with thin profit margins that leave them little room to adjust to sudden changes in their labor costs other than by eliminating jobs.
An underrated problem with pricing low-skill workers out of the job market is that their earnings losses are not limited to their period of unemployment. It is usually while holding a job that an individual acquires the skills necessary to achieve higher future earnings. It is therefore usually better for that individual to be employed for a low wage than not to be employed at all. This too is widely recognized. A working paper from the Boston Fed recently found that “the earnings of displaced workers do not catch up to those of their nondisplaced counterparts for nearly 20 years.” As the paper further states, “the longer a worker is unemployed, the more his or her skills. . . depreciate, making the worker less valuable to a new employer.”
This effect is of particular concern right now when young adults – those most often harmed by minimum wage increases -- are falling out of the workforce in rising numbers. No one knows for sure why this is happening, but the effect on these workers will be lower earnings for many years to come. This trend, as seen in Figure 1 reproduced from the St. Louis Fed, should give lawmakers pause before erecting further barriers to employment.
Figure 1: Labor Force Participation Rate for Workers Age 20-24, 2006-16
Labor Force Participation- FRED
It is appropriate for lawmakers to consider policies to raise worker living standards, including the compensation they receive for their labor. The amount of income support low-wage workers should receive beyond the amount they can freely earn is an important societal value judgment. However, it is a separate value judgment from whether and where to set a minimum wage, which is instead effectively a decision about how stringently to prohibit individuals from working.
http://economics21.org/html/minimum-wage-laws-are-barriers-employment-1776.html
Callinectes
Proud MAGA Semi-Facist
No, I've got one piece of anecdotal "evidence"that just so happens to come from me. But to show you how gracious and magnanimous I am, I polled 15 of my high school seniors and juniors with one question: "If you were making $15 an hour at a fast food joint, would you consider it as a permanent career choice?". 12 said absolutely not, 2 mouth breathing idiots said "hell, yes!", and one moron said he'd have to think about it. So, you've got 2 in your corner and one on the fence. Congratulations. Go Team 'murica!
Taichiliberal
Shaken, not stirred!
Seems you've got nothing but sour grapes, as you can't logically or factually disprove or dispute the OP. typical of the intellectually impotent conservative of our times.
Taichiliberal
Shaken, not stirred!
Government does not and cannot compel employers to hire workers and pay them a given wage. What government does instead through minimum wage laws is to prohibit employment at lower wages. There is no guarantee that every job made illegal by this prohibition will be replaced by another higher-paying one. Indeed it is a virtual certainty that at least some jobs will not be.
So this is NOT a barrier, because the jobs that are currently under paying people (unable to exist with the cost-of-living on said wage) would be made to give that employee a fighting chance. With more money, more is spent in the local market and such. A "higher paying" job wouldn't be necessary based on the employees ability and such.
Taichiliberal
Shaken, not stirred!
Says who? come on, you stupid blowhard, gives us the legal definition. I dare you.
cawacko
Well-known member
You are correct that the employee who maintains his position at the higher rate benefits. The barrier to entry comes to those who skills don't match that higher rate and thus can't get hired.
canceled.2021.1
#AMERICAISDEAD
Why s it wrong to work three jobs? Why do you care what they do. Someone's pay is between them and their employer
canceled.2021.1
#AMERICAISDEAD
Lefties need to stay out of people's W2s
Circular reasoning of the very very stupid......
The fast food worker has to make the time.
I did. I got two additional undergrad degrees, plus two graduate degrees working full-time or part-time for minimum wage.
It's all about desire. If they want it bad enough, they'll find a way.
There's only one base that needs to be covered. Someone doing a job where the hardest thing they have to learn is to ask "do you want fries with that?" isn't and never will be worth $15 no matter how many excuses you make about how "hard" they have to work. Someone doing a fast food job that requires little to no skill is overpaid at the current $7.25. So next time the pro $15/hour folk want to think that they are worth that much, I suggest they look at what little they really do that involves something other than being trained like a circus monkey.
I dare someone working in fast food to justify how working in such a low skilled job is worth $15. It isn't and you can't prove it. You'll run your damn mouth about lots of things you think do but NONE of them will you be able to prove.
Come, you stupid Liberal asshole, go for it. I dare YOU.
You haven't proven anything in the OP. Just another example of you thinking because you said it, it's true.
Seems someone never explained to you that you saying it isn't proof. Are your parents just another pair disappointed that the one they raised turned out to be a Liberal piece of shit or are they what they raised you to be? You tell me. It's one or the other.
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More denial from the forum admitted piece of shit. YOU answered a direct question. Why do you deny it now? Were you lying when you answered it?
canceled.2021.1
#AMERICAISDEAD
Its always easy to sit in the cheap seats and tell others how they should do things. These people are no different than the cry babies crying in their Starbucks because Pete Carroll threw the ball instead of giving it to Lynch. Armchair quarterbacks always think they have the answers but have the luxury of never having to prove it themselves