Wyatt earp
Diamond Member
- Apr 21, 2012
- 69,975
- 16,383
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Damn this even coming from them.
Don't Kid Yourself on the $15 Minimum Wage
Don’t Kid Yourself on the $15 Minimum Wage
The bigger problem is that raising wages by government fiat can really screw up labor markets. The cost burden falls disproportionately on small- and mid-sized retailers, restaurants, low-skill manufacturers and nonprofit social service agencies. These business owners already are struggling to cover the rising costs of health insurance, workers’ compensation and regulatory compliance with low profit margins. They also have to compete with big box retailers, restaurant chains and overseas producers.
The weak economy and strong competition make it hard to pass cost increases on to consumers. If wages rise faster than product prices, many small and mid-sized companies will reduce labor costs by investing in machinery and other labor-saving strategies. How many new self-service lanes have you seen open up in your local grocery store?
But lost jobs will not be the worst part for low-skilled workers. Setting a high minimum wage creates a moral hazard for them. Large numbers of working poor will be conned into thinking they don’t need to build up their human capital to earn a decent living. They will avoid the time and expense of extra training that might help them advance. They will find themselves trapped in low-skill jobs.
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Don't Kid Yourself on the $15 Minimum Wage
Don’t Kid Yourself on the $15 Minimum Wage
The bigger problem is that raising wages by government fiat can really screw up labor markets. The cost burden falls disproportionately on small- and mid-sized retailers, restaurants, low-skill manufacturers and nonprofit social service agencies. These business owners already are struggling to cover the rising costs of health insurance, workers’ compensation and regulatory compliance with low profit margins. They also have to compete with big box retailers, restaurant chains and overseas producers.
The weak economy and strong competition make it hard to pass cost increases on to consumers. If wages rise faster than product prices, many small and mid-sized companies will reduce labor costs by investing in machinery and other labor-saving strategies. How many new self-service lanes have you seen open up in your local grocery store?
But lost jobs will not be the worst part for low-skilled workers. Setting a high minimum wage creates a moral hazard for them. Large numbers of working poor will be conned into thinking they don’t need to build up their human capital to earn a decent living. They will avoid the time and expense of extra training that might help them advance. They will find themselves trapped in low-skill jobs.
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