Andylusion
Platinum Member
Unfortunately there are posters ( andaronjim ) on this forum who are misinformed and do not understand that minimum wage is different in each state across the country. The federal government sets a floor for a wage which is currently $7.25. This map shows the minimum wage of each state across the country. It is important to understand because each stat might have living conditions that are much higher than other states. The $13 minimum wage in California where even those making $20+ an hour cannot afford to live where they work, could fund raising a family in Kentucky, however the minimum wage here is $7.25, almost HALF of that in California. So please remember this when making your argument.
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The actual minimum wage is $0.00
It's what you get if machines take over your job, or if your boss can now hire a person worth the extra money he has to spend to pay you to do a job YOU are not providing the worth for at the inflated salary.
$7.25 is an inflated salary?
Well first, as the original poster was pointing out, the value of the salary, and the value of the labor, are both flexible.
$50,000 a year in California is practically poverty, while being almost upper class in Mississippi.
At the same time, the value of your labor changes dramatically based on a host of things.
One of the big problems with all left-wing ideology, is that they constantly rely on a one-size-fits-all theory of governance.
The tax rate the works in California, should work everywhere. The regulations that work in New Jersey, should work everywhere.
The value of a job... whatever job... is the same everywhere.
Yet in their own lives they never think this way. Your in-laws say "Why don't live your life like we do. Our system works for us!", and you say... I'm not you, and you are not me, and what works for you doesn't work for me.
Right? It's like one-size-fits-all clothing, that everyone hates.
Well this is true of $7.25/hour. Is that an inflated wage? Well it depends. I think the implication that $7.25 can't be an inflated wage, is wrong.
You can be drastically over paid at $7.25. That's why businesses lay of employees, when they are only paying them $7.25 an hour.
The value of your labor is contingent on many.
The primary factor being, what profit you earn the person you are working for.
Let me give you an example. Near where I live is a bread bakery. More like a bread factory really. That's all they do, is make bread. They have big building, and they load up trucks, and deliver bread to all the grocery stores in the area.
They also have a tiny, about the size of a studio apartment, room with a sign in the window, where you can walk in and by fresh bread right from the ovens.
At this small micro-store at the bread bakery, you can get it 30 minutes after it was removed from the ovens.
So I actually knew a girl that worked there, at this micro-store. She would come in, sit at the register, and collect money for sitting. She would get a dozen to two dozen customers in an entire day.
How much in real profit were they getting from selling at most 30 loafs of bread, while paying her minimum wage? Roughly $2 a loaf, $60, and her wage was $58 for 8 hours at $7.25... not including taxes and the cost of benefits.
And honestly, is sitting there, watching TV, with an occasional "would you like that in a bag?", and sliding a credit card on a reader, really worth $7.25 an hour? No it's not.
Now you might ask why the company had such a store at all, if they were not really making a profit. In fact, almost impossible to make a profit, if you include the overhead.
Two reasons: One, the micro store was built 30 years ago, when far fewer stores existed in the area, and thus they had a many more customers. Two is because the micro-store does serve as a sort of advertisement for the brand. People would see the store, and eventually come in out of curiosity, have some really good bread, and then end up buying their brand of bread at the regulator grocery stores.
Regardless, I think you get my point. $7.25 can be a very inflated wage. It depends on many things.
In fact, the value of the labor can differ inside a company, even with exact same jobs.
So in the 90s, I was working at Wendy's, when the minimum wage was $5.25. I think I was getting $6.50 an hour, because I was full time (+50¢/hour), and I was cashier (+25¢/hour), and because you got 25¢/hour raise every six months, and I had been there one year.
So $6.50/hour. Well I found out that the store down town was paying cashiers $10/hours an hour to start. At the time, I had no idea why they paid so much more, but it was annoying to me that other people doing the exact same job, for the exact same company, were getting paid more.
Then one night, that store sent out an SOS for help. I forget what exactly they called it, there was a term for it at that time, where a store sent out a call for help, and any store that could send over spare employees, was supposed to do so, and would be compensated by corporate.
So they sent me.
That store was packed with customers, and 2 or 3 of their employees called off. Packed. Customers everywhere. And it stayed packed right up till closing. People were still trying to enter the store, when they were flipping chairs up on tables, and turning the dining room lights off.
This was entirely different from the Suburban Wendy's I was used to. We had a lunch rush that lasted from 11:30 to 1 PM, and then a dinner stream of people from 5 PM till 7 PM. Before lunch, or between If you had a dozen cars from 10 AM till lunch, or between lunch and dinner... that was busy day.
Place was dead most of the day.
Again, the value of the labor depends on the profits. How much profit is there when your employees are standing around largely idle for half the working day? Not much. So wages are low.
How much profit is there, when the store has people waiting outside the story when the doors open, and is packed the entire day, and still has people trickling in up till closing time? Tons.
So wages are high.
There are many aspects to the value of labor. But the answer is yes, $7.25 can be way over priced. Which is why when the minimum wage went up, tons of people lost their jobs.
In your bread story, you are TOTALLY off base. The work being done by the girl is not HER value. The onus of the situation is the bad business decision of the bakery to continue to have the store despite the low number of customers and sales. The work value of the employee in the store is going to be the same for anyone you put in there due to outside influences they have zero control over. You could put Jeff Bezos in there and he would give the same amount of labor to profit ratio as the girl. So that is NOT about the wages, it is about continuing to run a business that is no longer profitable.
So I would agree with everything you said... except that final conclusion. Everything you said is correct.... generally.
There are aspects that the girl can control. People who don't show up on time, or do lousy work, sometimes are still worth employing at a lower wage.
One example was at a company where they hired a guy with mental issues. So he could only be counted on to clean the floors. And honestly, that was about it. Well of course they are not going to pay him a regular wage, when he wasn't able to do a regular job. So he needed a job of any kind, and they needed the floors cleaned, so they created a contract position, where he was paid about $10,000 a year, to clean the floors, and that's it.
And this is true throughout all business. Even in minimum wage jobs, you can have this. I've seen it a few times.
I told you that you got an automatic pay raise if you worked consistently for 6 months or more. Well that automatic pay increase, was still dependent on performance. We had people that worked 'full time' but showed up late, left early, disappeared for smoke breaks in the middle of their shift.
They would have their automatic pay raise waived, and be really angry that a year later, they were still earning minimum wage. There is a spot between not bad enough to fire, but not good enough to pay more.
So there are aspects to the value of your labor.
So that is NOT about the wages, it is about continuing to run a business that is no longer profitable.
So here is the real crux of the problem. What you just said was contradictory. You said it's about running a business that is no longer profitable.... but the reason it is no longer profitable, isn't just because of reduced number of customers.
It is also because the cost of labor has been pushed above the value of the labor. The labor value has gone down some.... at the same time the cost of the labor has increased because of the minimum wage.
Result: Business isn't profitable.
Remember, when they opened that business, the minimum wage was $4.25. You think they could sell enough bread even today, to make a profit if the minimum wage was $4.25? Sure. And it is a perfect job for a high school student, who wants some experience to put on their resume for a future better job, and some spending money during their high school years.
Or even a retiree, that could do this as a retirement job.
And here in the state of Ohio, the minimum wage has been indexed with automatic increases. The Ohio Minimum wage has increased every single year since 2010.
So every single year, that little store is getting less and less profitable, until they finally close it. In fact, I have not been over that way in 10 years now, and I wouldn't be surprised if they closed it already.
When that happens, if it hasn't already, people that could be employed, won't be.
The value of the labor does not increase, just because the minimum wage does.
When the cost of labor, exceeds the value of the labor, the business closes and people lose their jobs.