Minimum Wage Increase: They Never Talks About the SALES

[OKTexas]

Just now, I saw another report about the topic of minimum wage increase. This one was on CNN, hosted by Julie Banderas. She was talking to Scott Gamm, of HelpSaveMyDollars.com, a financial website focused on helping consumers save and learn about money. They were talking about the recent 14-1 vote by the city of Los Angeles to raise the minimum wage to $15 by 2020.

Scott might be well versed on various aspects pertaining to consumer finances but, on the minimum wage raise, he is waaay off the mark. He said three things about the minimum wage raise topic. And he was WRONG on all three. Gamm merely recited the 3 most commonly heard (and programmed) descriptions about minimum wage raises.

1. He said it would cause jobs to be lost. FALSE! Employers function with a number of employees that bring them the most income/profit. They CANNOT reduce staff. Any more or less employees results in SALES and income reduction. Layoffs result in losses, not gains.

2. He (and Banderas too) said prices would be raised (or fees created) to compensate for the wage losses, and these losses would just be "passed on" to the customers. More FALSE! scare talk. Businesses CANNOT raise prices because they are already fixed at a market price, related to maximization of sales/income. Any change in price (up or down) results in reduction of SALES and income.

3. He said businesses will move away from LA. FALSE! (in most cases). Does Gamm think that closing down a business and moving to another location can be done scott (no pun intended) free ? Depending on the business, moving costs can vary from just barely economical, to completely UNeconomical, and the latter is much more often the case. Imagine a machine shop with over 100 large production machines, having to pack then all up and move miles away. Some businesses could do it. Not many.

So here's the real crux of all this. As in 1000 other media reports I've seen on minimum wage increases, the most important aspect of this is NEVER MENTIONED. Not a word. That is the increase in DISPOSABLE INCOME resulting in INCREASES SALES$$$. All businesses get this, and generally it far outweighs labor increases, since the number of wage raised consumers (not just those at the minimum wage) by far outnumbers any one employer's workers who are getting wage increases.

Then there's also the fact that many business, while receiving this big SALES boost, do NOT have any wage loss at all. These are businesses who are mom & pop and have no employees, those whose workers are all working just on sales commission (car lots, furniture, real estate, insurance, etc), and third, those with skilled workers (ex. machine shops) whose workers all already get well over $15 hour, or whatever the MW would be raised to.

I think back to when I owned a business. I paid my commission salespeople $350/hour (in 2015 dollars), and they still were only receiving 15% of the sale. In all, I made fine profits and expanded the business. Biggest downer ? All the people who called in and said > "Sorry. I can't afford it." Of course they can't. Not one somebody out there is paying them a low minimum wage. To be successful in business, you have a lot fo things to do. But you can't do anything, if the public around you doesn't have money in their pockets to buy what you're trying to sell.

This is why Conservatives who support raising the MW nationwide, outnumber Conservatives who don't, 54% to 44%.

Why don't they talk about sales, because it's not enough money to make any difference in the grand scheme of things. If you doubled the minimum wage it would only add about $367.68 million pre-tax dollars to the economy, that means squat to a $14.5 trillion dollar economy.

Except money like that grows exponentially. Someone buys something and that something needed paint and all the people the paint industry employs, and it needed plastic and all the people that industry employs, and it needed brass screws and all the people that industry employs. See? It's not limited to the cash that group is spending. It forks out to lots of other people who supply stuff.

You can say that, but it's not true. Many of these folks get food stamps, unless they raise the threshold to qualify for them, most of the money will go to food purchases, the rest will be eaten by the food inflation caused by the wage increase in the first place.

 

[Care4all]

if only 4-6% of the workers in this nation are paid minimum wage, then they are only producing about 6% of the Nations GDP, 94% is produced by mostly much higher paid workers....

And if 50% of those making minimum wage, work in the fast food/restaurant business, then only 2-3% of all minimum wage workers produce other things.

Even with having to raise those additional people making close to the $10 an hour that Congress wants to raise the minimum wage to, we will see very little, if any rise at all in inflation. Numbers talk.

And this is why, if done in increments, raising the minimum wage HAS NEVER had a measurable effect on inflation.

All of these wild examples and wild speculations is simply B.S.

There are exceptions for small businesses with 50-100 employees or less, where they can take several more years to raise their minimum wage earners.

If a company has as many as 100 employees as Skull Pilot mentioned, it is a fairly large company and not all of their employees are at minimum wage...they probably have very few people at minimum wage, unless they have a huge turn over rate in employees and pay out the kazoo for constant training of new employees, and unless this multi million dollar company has no upper management and no middle management and no comptroller and no accountant and no administrative assistants and no receptionist, and no other workers than the new hires they hire off the street at minimum. This is HIGHLY UNLIKELY.

I am not denying that there will be some exceptions, where a pizzeria that is not performing profitably as they sit, and an increase in minimum wage could lead to their going out of business EARLIER than they would have eventually gone out of business....BUT the customers who were going to the hurting Pizzeria, will end up going to the other Pizzeria a few blocks or a mile away, and THAT business will have an increase in sales and have the need to hire more people....the very people that lost their jobs at the hurting Pizzeria could be hired by the Pizzeria down the road....

This is not the end of the world, this is not an inflation breaker, and this is not an unemployment increaser, and this is not a business breaker either....with very few exceptions.

So, in other words, as long as minimum wage increases are minimal, they'll have minimal impact. Agreed.

Sadly, yes.....

It will slightly help a handful, however much we choose to raise the minimum, but it won't be enough to affect the inflation rate, or to affect our overall unemployment rate....nor would it give us a huge increase in sales only because the pay increase is not huge, though this level of income earners do spend near every dime they make, in the economy and save none....so there could be a slight uptick.

And I can see where you are coming from regarding all of this...about the corporations wanting the minimum wage...and many other sly points you have made throughout this conversation...

I just don't know what to do about it all at this point in the game...so many things have lead to where we are today, with an over supply of minimum wage eligible workers...legal immigrants, llegal immigrants, teenagers, adults who were in higher paying jobs willing to take any job, and spouses that are taking anything at all to supplement their family income, along with seniors who found they did not make enough off of social security to survive, and increasing our HB1 visas making other replaced Americans taking minimum waged jobs to just have some kind of income.

 

[Toddsterpatriot]

if only 4-6% of the workers in this nation are paid minimum wage, then they are only producing about 6% of the Nations GDP, 94% is produced by mostly much higher paid workers....

And if 50% of those making minimum wage, work in the fast food/restaurant business, then only 2-3% of all minimum wage workers produce other things.

Even with having to raise those additional people making close to the $10 an hour that Congress wants to raise the minimum wage to, we will see very little, if any rise at all in inflation. Numbers talk.

And this is why, if done in increments, raising the minimum wage HAS NEVER had a measurable effect on inflation.

All of these wild examples and wild speculations is simply B.S.

There are exceptions for small businesses with 50-100 employees or less, where they can take several more years to raise their minimum wage earners.

If a company has as many as 100 employees as Skull Pilot mentioned, it is a fairly large company and not all of their employees are at minimum wage...they probably have very few people at minimum wage, unless they have a huge turn over rate in employees and pay out the kazoo for constant training of new employees, and unless this multi million dollar company has no upper management and no middle management and no comptroller and no accountant and no administrative assistants and no receptionist, and no other workers than the new hires they hire off the street at minimum. This is HIGHLY UNLIKELY.

I am not denying that there will be some exceptions, where a pizzeria that is not performing profitably as they sit, and an increase in minimum wage could lead to their going out of business EARLIER than they would have eventually gone out of business....BUT the customers who were going to the hurting Pizzeria, will end up going to the other Pizzeria a few blocks or a mile away, and THAT business will have an increase in sales and have the need to hire more people....the very people that lost their jobs at the hurting Pizzeria could be hired by the Pizzeria down the road....

This is not the end of the world, this is not an inflation breaker, and this is not an unemployment increaser, and this is not a business breaker either....with very few exceptions.

Sorry, the low skilled bottom 6% of the workforce is responsible for much less than 6% of GDP.

 

[Care4all]

if only 4-6% of the workers in this nation are paid minimum wage, then they are only producing about 6% of the Nations GDP, 94% is produced by mostly much higher paid workers....

And if 50% of those making minimum wage, work in the fast food/restaurant business, then only 2-3% of all minimum wage workers produce other things.

Even with having to raise those additional people making close to the $10 an hour that Congress wants to raise the minimum wage to, we will see very little, if any rise at all in inflation. Numbers talk.

And this is why, if done in increments, raising the minimum wage HAS NEVER had a measurable effect on inflation.

All of these wild examples and wild speculations is simply B.S.

There are exceptions for small businesses with 50-100 employees or less, where they can take several more years to raise their minimum wage earners.

If a company has as many as 100 employees as Skull Pilot mentioned, it is a fairly large company and not all of their employees are at minimum wage...they probably have very few people at minimum wage, unless they have a huge turn over rate in employees and pay out the kazoo for constant training of new employees, and unless this multi million dollar company has no upper management and no middle management and no comptroller and no accountant and no administrative assistants and no receptionist, and no other workers than the new hires they hire off the street at minimum. This is HIGHLY UNLIKELY.

I am not denying that there will be some exceptions, where a pizzeria that is not performing profitably as they sit, and an increase in minimum wage could lead to their going out of business EARLIER than they would have eventually gone out of business....BUT the customers who were going to the hurting Pizzeria, will end up going to the other Pizzeria a few blocks or a mile away, and THAT business will have an increase in sales and have the need to hire more people....the very people that lost their jobs at the hurting Pizzeria could be hired by the Pizzeria down the road....

This is not the end of the world, this is not an inflation breaker, and this is not an unemployment increaser, and this is not a business breaker either....with very few exceptions.

Sorry, the low skilled bottom 6% of the workforce is responsible for much less than 6% of GDP.

Which only proves my point Todd...It's not a big enough portion of the economy to cause inflation, it will not hurt the overall economy to raise the minimum to $10.10 which Congress is suggesting.

 

[protectionist]

There are people here in denial of the economic reality that if you raise prices, you lower demand.

And that economic reality is exactly why business owners CANNOT raise prices in response to a minimum wage raise.

 

[protectionist]

Just now, I saw another report about the topic of minimum wage increase. This one was on CNN, hosted by Julie Banderas. She was talking to Scott Gamm, of HelpSaveMyDollars.com, a financial website focused on helping consumers save and learn about money. They were talking about the recent 14-1 vote by the city of Los Angeles to raise the minimum wage to $15 by 2020.

Scott might be well versed on various aspects pertaining to consumer finances but, on the minimum wage raise, he is waaay off the mark. He said three things about the minimum wage raise topic. And he was WRONG on all three. Gamm merely recited the 3 most commonly heard (and programmed) descriptions about minimum wage raises.

1. He said it would cause jobs to be lost. FALSE! Employers function with a number of employees that bring them the most income/profit. They CANNOT reduce staff. Any more or less employees results in SALES and income reduction. Layoffs result in losses, not gains.

2. He (and Banderas too) said prices would be raised (or fees created) to compensate for the wage losses, and these losses would just be "passed on" to the customers. More FALSE! scare talk. Businesses CANNOT raise prices because they are already fixed at a market price, related to maximization of sales/income. Any change in price (up or down) results in reduction of SALES and income.

3. He said businesses will move away from LA. FALSE! (in most cases). Does Gamm think that closing down a business and moving to another location can be done scott (no pun intended) free ? Depending on the business, moving costs can vary from just barely economical, to completely UNeconomical, and the latter is much more often the case. Imagine a machine shop with over 100 large production machines, having to pack then all up and move miles away. Some businesses could do it. Not many.

So here's the real crux of all this. As in 1000 other media reports I've seen on minimum wage increases, the most important aspect of this is NEVER MENTIONED. Not a word. That is the increase in DISPOSABLE INCOME resulting in INCREASES SALES$$$. All businesses get this, and generally it far outweighs labor increases, since the number of wage raised consumers (not just those at the minimum wage) by far outnumbers any one employer's workers who are getting wage increases.

Then there's also the fact that many business, while receiving this big SALES boost, do NOT have any wage loss at all. These are businesses who are mom & pop and have no employees, those whose workers are all working just on sales commission (car lots, furniture, real estate, insurance, etc), and third, those with skilled workers (ex. machine shops) whose workers all already get well over $15 hour, or whatever the MW would be raised to.

I think back to when I owned a business. I paid my commission salespeople $350/hour (in 2015 dollars), and they still were only receiving 15% of the sale. In all, I made fine profits and expanded the business. Biggest downer ? All the people who called in and said > "Sorry. I can't afford it." Of course they can't. Not one somebody out there is paying them a low minimum wage. To be successful in business, you have a lot fo things to do. But you can't do anything, if the public around you doesn't have money in their pockets to buy what you're trying to sell.

This is why Conservatives who support raising the MW nationwide, outnumber Conservatives who don't, 54% to 44%.

Why don't they talk about sales, because it's not enough money to make any difference in the grand scheme of things. If you doubled the minimum wage it would only add about $367.68 million pre-tax dollars to the economy, that means squat to a $14.5 trillion dollar economy.

If you have 10 MW workers, and the MW goes up to $10/hour, you couldn't cover that cost increase (easily) with THOUSANDS of MW worker customers in your sales area ? Give me a break. Now just think of all those business who have NO MW WORKERS at all. To whom the increase in disposable income and sales is 100% gain.

When I owned a business, I paid my sales people $150/hour, in th e1980s ($350/hr in 2015 dollars)

PS - you post is empty without source links.

 

[protectionist]

if only 4-6% of the workers in this nation are paid minimum wage, then they are only producing about 6% of the Nations GDP, 94% is produced by mostly much higher paid workers....

And if 50% of those making minimum wage, work in the fast food/restaurant business, then only 2-3% of all minimum wage workers produce other things.

Even with having to raise those additional people making close to the $10 an hour that Congress wants to raise the minimum wage to, we will see very little, if any rise at all in inflation. Numbers talk.

And this is why, if done in increments, raising the minimum wage HAS NEVER had a measurable effect on inflation.

All of these wild examples and wild speculations is simply B.S.

There are exceptions for small businesses with 50-100 employees or less, where they can take several more years to raise their minimum wage earners.

If a company has as many as 100 employees as Skull Pilot mentioned, it is a fairly large company and not all of their employees are at minimum wage...they probably have very few people at minimum wage, unless they have a huge turn over rate in employees and pay out the kazoo for constant training of new employees, and unless this multi million dollar company has no upper management and no middle management and no comptroller and no accountant and no administrative assistants and no receptionist, and no other workers than the new hires they hire off the street at minimum. This is HIGHLY UNLIKELY.

I am not denying that there will be some exceptions, where a pizzeria that is not performing profitably as they sit, and an increase in minimum wage could lead to their going out of business EARLIER than they would have eventually gone out of business....BUT the customers who were going to the hurting Pizzeria, will end up going to the other Pizzeria a few blocks or a mile away, and THAT business will have an increase in sales and have the need to hire more people....the very people that lost their jobs at the hurting Pizzeria could be hired by the Pizzeria down the road....

This is not the end of the world, this is not an inflation breaker, and this is not an unemployment increaser, and this is not a business breaker either....with very few exceptions.

Neato.

Why don't you explain to us why you object to simply basing a worker's wages upon what that worker's work is worth?

Because most employers don't pay what the worker is worth, but what they can get away with paying. How can you not know that? It's so obvious.

They pay what the labor is worth, not what the worker is worth. The amount their labor is worth is agreed to by both the employer and the employee. Do you understand that? Neither can compel the other into an employment agreement. If either the employee, or the employer, don't feel the wage is appropriate, they can walk away.

This is one of the most common myths that have been flying around forever. The employee is under the duress of needing to survive. Just because he takes a job (out of necessity), doesn't mean he considers the wage proper.

 

[OKTexas]

Just now, I saw another report about the topic of minimum wage increase. This one was on CNN, hosted by Julie Banderas. She was talking to Scott Gamm, of HelpSaveMyDollars.com, a financial website focused on helping consumers save and learn about money. They were talking about the recent 14-1 vote by the city of Los Angeles to raise the minimum wage to $15 by 2020.

Scott might be well versed on various aspects pertaining to consumer finances but, on the minimum wage raise, he is waaay off the mark. He said three things about the minimum wage raise topic. And he was WRONG on all three. Gamm merely recited the 3 most commonly heard (and programmed) descriptions about minimum wage raises.

1. He said it would cause jobs to be lost. FALSE! Employers function with a number of employees that bring them the most income/profit. They CANNOT reduce staff. Any more or less employees results in SALES and income reduction. Layoffs result in losses, not gains.

2. He (and Banderas too) said prices would be raised (or fees created) to compensate for the wage losses, and these losses would just be "passed on" to the customers. More FALSE! scare talk. Businesses CANNOT raise prices because they are already fixed at a market price, related to maximization of sales/income. Any change in price (up or down) results in reduction of SALES and income.

3. He said businesses will move away from LA. FALSE! (in most cases). Does Gamm think that closing down a business and moving to another location can be done scott (no pun intended) free ? Depending on the business, moving costs can vary from just barely economical, to completely UNeconomical, and the latter is much more often the case. Imagine a machine shop with over 100 large production machines, having to pack then all up and move miles away. Some businesses could do it. Not many.

So here's the real crux of all this. As in 1000 other media reports I've seen on minimum wage increases, the most important aspect of this is NEVER MENTIONED. Not a word. That is the increase in DISPOSABLE INCOME resulting in INCREASES SALES$$$. All businesses get this, and generally it far outweighs labor increases, since the number of wage raised consumers (not just those at the minimum wage) by far outnumbers any one employer's workers who are getting wage increases.

Then there's also the fact that many business, while receiving this big SALES boost, do NOT have any wage loss at all. These are businesses who are mom & pop and have no employees, those whose workers are all working just on sales commission (car lots, furniture, real estate, insurance, etc), and third, those with skilled workers (ex. machine shops) whose workers all already get well over $15 hour, or whatever the MW would be raised to.

I think back to when I owned a business. I paid my commission salespeople $350/hour (in 2015 dollars), and they still were only receiving 15% of the sale. In all, I made fine profits and expanded the business. Biggest downer ? All the people who called in and said > "Sorry. I can't afford it." Of course they can't. Not one somebody out there is paying them a low minimum wage. To be successful in business, you have a lot fo things to do. But you can't do anything, if the public around you doesn't have money in their pockets to buy what you're trying to sell.

This is why Conservatives who support raising the MW nationwide, outnumber Conservatives who don't, 54% to 44%.

Why don't they talk about sales, because it's not enough money to make any difference in the grand scheme of things. If you doubled the minimum wage it would only add about $367.68 million pre-tax dollars to the economy, that means squat to a $14.5 trillion dollar economy.

If you have 10 MW workers, and the MW goes up to $10/hour, you couldn't cover that cost increase (easily) with THOUSANDS of MW worker customers in your sales area ? Give me a break. Now just think of all those business who have NO MW WORKERS at all. To whom the increase in disposable income and sales is 100% gain.

When I owned a business, I paid my sales people $150/hour, in th e1980s ($350/hr in 2015 dollars)

PS - you post is empty without source links.

Well I looked up how many people are working for minimum wage, I use Pew research figures of 1.53 million, not 10 million that you claim, without any supporting source I might add, and I did the calculation myself. I calculated based on an avg 32 hour work week, some get more, some get less, you can thank maobamacare for that.

Also see post 1041 to see where the majority of that raise will go.

 

[LOki]

if only 4-6% of the workers in this nation are paid minimum wage, then they are only producing about 6% of the Nations GDP, 94% is produced by mostly much higher paid workers....

And if 50% of those making minimum wage, work in the fast food/restaurant business, then only 2-3% of all minimum wage workers produce other things.

Even with having to raise those additional people making close to the $10 an hour that Congress wants to raise the minimum wage to, we will see very little, if any rise at all in inflation. Numbers talk.

And this is why, if done in increments, raising the minimum wage HAS NEVER had a measurable effect on inflation.

All of these wild examples and wild speculations is simply B.S.

There are exceptions for small businesses with 50-100 employees or less, where they can take several more years to raise their minimum wage earners.

If a company has as many as 100 employees as Skull Pilot mentioned, it is a fairly large company and not all of their employees are at minimum wage...they probably have very few people at minimum wage, unless they have a huge turn over rate in employees and pay out the kazoo for constant training of new employees, and unless this multi million dollar company has no upper management and no middle management and no comptroller and no accountant and no administrative assistants and no receptionist, and no other workers than the new hires they hire off the street at minimum. This is HIGHLY UNLIKELY.

I am not denying that there will be some exceptions, where a pizzeria that is not performing profitably as they sit, and an increase in minimum wage could lead to their going out of business EARLIER than they would have eventually gone out of business....BUT the customers who were going to the hurting Pizzeria, will end up going to the other Pizzeria a few blocks or a mile away, and THAT business will have an increase in sales and have the need to hire more people....the very people that lost their jobs at the hurting Pizzeria could be hired by the Pizzeria down the road....

This is not the end of the world, this is not an inflation breaker, and this is not an unemployment increaser, and this is not a business breaker either....with very few exceptions.

Neato.

Why don't you explain to us why you object to simply basing a worker's wages upon what that worker's work is worth?

Because most employers don't pay what the worker is worth, but what they can get away with paying. How can you not know that? It's so obvious.

In typical (and predictable) fashion, a proponent for statutory minimum wage has answered a question different from the one asked. I did not ask about workers NOT being paid what they are worth.

Why don't you explain to us why you object to simply basing a worker's wages upon what that worker's work is worth?

 

[LOki]

There are people here in denial of the economic reality that if you raise prices, you lower demand.

And that economic reality is exactly why business owners CANNOT raise prices in response to a minimum wage raise.

Which then leads to unemployment.

if only 4-6% of the workers in this nation are paid minimum wage, then they are only producing about 6% of the Nations GDP, 94% is produced by mostly much higher paid workers....

And if 50% of those making minimum wage, work in the fast food/restaurant business, then only 2-3% of all minimum wage workers produce other things.

Even with having to raise those additional people making close to the $10 an hour that Congress wants to raise the minimum wage to, we will see very little, if any rise at all in inflation. Numbers talk.

And this is why, if done in increments, raising the minimum wage HAS NEVER had a measurable effect on inflation.

All of these wild examples and wild speculations is simply B.S.

There are exceptions for small businesses with 50-100 employees or less, where they can take several more years to raise their minimum wage earners.

If a company has as many as 100 employees as Skull Pilot mentioned, it is a fairly large company and not all of their employees are at minimum wage...they probably have very few people at minimum wage, unless they have a huge turn over rate in employees and pay out the kazoo for constant training of new employees, and unless this multi million dollar company has no upper management and no middle management and no comptroller and no accountant and no administrative assistants and no receptionist, and no other workers than the new hires they hire off the street at minimum. This is HIGHLY UNLIKELY.

I am not denying that there will be some exceptions, where a pizzeria that is not performing profitably as they sit, and an increase in minimum wage could lead to their going out of business EARLIER than they would have eventually gone out of business....BUT the customers who were going to the hurting Pizzeria, will end up going to the other Pizzeria a few blocks or a mile away, and THAT business will have an increase in sales and have the need to hire more people....the very people that lost their jobs at the hurting Pizzeria could be hired by the Pizzeria down the road....

This is not the end of the world, this is not an inflation breaker, and this is not an unemployment increaser, and this is not a business breaker either....with very few exceptions.

Neato.

Why don't you explain to us why you object to simply basing a worker's wages upon what that worker's work is worth?

Because most employers don't pay what the worker is worth, but what they can get away with paying. How can you not know that? It's so obvious.

They pay what the labor is worth, not what the worker is worth. The amount their labor is worth is agreed to by both the employer and the employee. Do you understand that? Neither can compel the other into an employment agreement. If either the employee, or the employer, don't feel the wage is appropriate, they can walk away.

This is one of the most common myths that have been flying around forever. The employee is under the duress of needing to survive. Just because he takes a job (out of necessity), doesn't mean he considers the wage proper.

The employer is under the duress of needing to survive. Just because he offers a job (out of necessity), doesn't mean he considers the wage he must pay to attract employees is proper... but he could be wrong about that

Just because a worker thinks his wage is not proper, it doesn't follow that he's naturally right in his assessment either.

Why don't you explain to us why you object to simply basing a worker's wages upon what that worker's work is worth?

 

[ShaklesOfBigGov]

What happened to all this talk of Obama's economic recovery through increasing job numbers, that we have to look at raising the minimum wage as a last resort over opportunities of Americans and college grads finding "skilled" job growth?

The pattern of American history has been that the more severe the recession, the stronger the recovery. Until now. In Mr. Obama’s recovery, average annual growth has been the slowest since the U.S. began compiling reliable economic statistics near the 20th century’s beginning

The Messes Obama Will Leave Behind - WSJ

 

[Skull Pilot]

I don't understand how you can be so dense. The economic benefits of raising the minimum wage would occur because the change would happen in the entire economy. Overall, a good portion of the economy would have more disposable income, so yeah, business in general would see an increase in demand.

Overall, a good portion of the economy would have more disposable income, so yeah, business in general would see an increase in demand.

And the increase still leaves them less profitable.

It would initially, yes, but over time the huge boom in consumer spending would change that.

Yea, it would make it better. People with money buy stuff. Who doesn't know that?

When the purchasing power of those already making the proposed wage see all thier costs rise they will not be able to buy as much will they?

So you make it possible for a few people to buy more (maybe) and you reduce the purchasing power of everyone else.

Supply and demand is what makes the price of goods rise. If no one wants it, no one will buy it.

So another idiot who believes labor costs have nothing to do with the final price of goods and services.

So tell me then if labor costs have absolutely no effect on prices why don't you open a business that sells the product that is in the highest demand in your town and pay everyone who works for you 100K a year?

You'd clean up right?

Wrong.

 

[Mac1958]

Why don't you explain to us why you object to simply basing a worker's wages upon what that worker's work is worth?

I agree with you that people should just be paid what they are worth. That would be the obvious motivation for people to put the effort into improving themselves and their skillset. Fundamental human dignity. It's an obvious point, and still there are many who will simply refuse to have that conversation. And if you feel that business is being unfairly targeted and penalized here, I'd agree with that, too.

Unfortunately, as with anything else, we have to deal with the reality of the situation. And here is the reality:

First, we have raised at least one full generation of young people, the Selfie Generation, who are terribly self-centered and entitled. We've given them participation medals just for showing up and we've avoided hurting their feelings in class. We've told them how special and wonderful they are while they're in school, knowing full well that the real world would not be nearly so kind. (Confident Idiots American Students Growing More Confident Less Capable)

Second, because these young people are entering the work force with far more phony "self esteem" than actual skills or proper attitude, they simply don't have as much value in the free market as they could have. So, bottom line, either American business "takes care" of them or they end up on the public dole, and we already know that this has become an inter-generational culture now.

And third, automation has eliminated the need for many, many people who have chosen not to increase their skill set, and our economy is clearly in a period of transition as we try to balance massively increased (and increasing) productivity with the skills and size of the labor force.

Bottom line is, we have little choice. It's going to fall on the backs of American business to "take care" of these people, at least until we efficiently find a way to deal with the boom in productivity and automation. If ever, and that's debatable. This, I strongly suspect, is a significant part of the reason for the terribly dishonest "you didn't build that" culture into which we have fallen. Business just has to give it up, tough shit.

I don't like it either, but it is what it is.

.

 

[Skull Pilot]

if only 4-6% of the workers in this nation are paid minimum wage, then they are only producing about 6% of the Nations GDP, 94% is produced by mostly much higher paid workers....

And if 50% of those making minimum wage, work in the fast food/restaurant business, then only 2-3% of all minimum wage workers produce other things.

Even with having to raise those additional people making close to the $10 an hour that Congress wants to raise the minimum wage to, we will see very little, if any rise at all in inflation. Numbers talk.

And this is why, if done in increments, raising the minimum wage HAS NEVER had a measurable effect on inflation.

All of these wild examples and wild speculations is simply B.S.

There are exceptions for small businesses with 50-100 employees or less, where they can take several more years to raise their minimum wage earners.

If a company has as many as 100 employees as Skull Pilot mentioned, it is a fairly large company and not all of their employees are at minimum wage...they probably have very few people at minimum wage, unless they have a huge turn over rate in employees and pay out the kazoo for constant training of new employees, and unless this multi million dollar company has no upper management and no middle management and no comptroller and no accountant and no administrative assistants and no receptionist, and no other workers than the new hires they hire off the street at minimum. This is HIGHLY UNLIKELY.

I am not denying that there will be some exceptions, where a pizzeria that is not performing profitably as they sit, and an increase in minimum wage could lead to their going out of business EARLIER than they would have eventually gone out of business....BUT the customers who were going to the hurting Pizzeria, will end up going to the other Pizzeria a few blocks or a mile away, and THAT business will have an increase in sales and have the need to hire more people....the very people that lost their jobs at the hurting Pizzeria could be hired by the Pizzeria down the road....

This is not the end of the world, this is not an inflation breaker, and this is not an unemployment increaser, and this is not a business breaker either....with very few exceptions.

Neato.

Why don't you explain to us why you object to simply basing a worker's wages upon what that worker's work is worth?

Because most employers don't pay what the worker is worth, but what they can get away with paying. How can you not know that? It's so obvious.

you don't pay what the worker is worth you pay for what his work is worth in the market.

For example no one on my support staff is paid less that 16 an hour which for my region of the country and my industry is the high average.

I pay the high average because I want to attract the best people I can and our turnover rate is extremely low because I get good people and treat them well. But then again my people need skills to do their job. There are jobs where there is no or little skill required so those jobs don't pay much and turnover is high because it's easy to replace people.

Now we run at about an 11% profit margin which is respectable but I'm shooting for 15%

Payroll is my second largest expense now if I listen to you I should be able to double the salary of all my support staff and keep my prices the same because only demand and not labor costs effect the price of the services we provide.

And you can't see how idiotic that statement is.

 

[Skull Pilot]

There are people here in denial of the economic reality that if you raise prices, you lower demand.

And that economic reality is exactly why business owners CANNOT raise prices in response to a minimum wage raise.

and if that raise in MW is drastic enough to erase the profits of the business what is to be done if prices can't be raised?

 

[Skull Pilot]

Just now, I saw another report about the topic of minimum wage increase. This one was on CNN, hosted by Julie Banderas. She was talking to Scott Gamm, of HelpSaveMyDollars.com, a financial website focused on helping consumers save and learn about money. They were talking about the recent 14-1 vote by the city of Los Angeles to raise the minimum wage to $15 by 2020.

Scott might be well versed on various aspects pertaining to consumer finances but, on the minimum wage raise, he is waaay off the mark. He said three things about the minimum wage raise topic. And he was WRONG on all three. Gamm merely recited the 3 most commonly heard (and programmed) descriptions about minimum wage raises.

1. He said it would cause jobs to be lost. FALSE! Employers function with a number of employees that bring them the most income/profit. They CANNOT reduce staff. Any more or less employees results in SALES and income reduction. Layoffs result in losses, not gains.

2. He (and Banderas too) said prices would be raised (or fees created) to compensate for the wage losses, and these losses would just be "passed on" to the customers. More FALSE! scare talk. Businesses CANNOT raise prices because they are already fixed at a market price, related to maximization of sales/income. Any change in price (up or down) results in reduction of SALES and income.

3. He said businesses will move away from LA. FALSE! (in most cases). Does Gamm think that closing down a business and moving to another location can be done scott (no pun intended) free ? Depending on the business, moving costs can vary from just barely economical, to completely UNeconomical, and the latter is much more often the case. Imagine a machine shop with over 100 large production machines, having to pack then all up and move miles away. Some businesses could do it. Not many.

So here's the real crux of all this. As in 1000 other media reports I've seen on minimum wage increases, the most important aspect of this is NEVER MENTIONED. Not a word. That is the increase in DISPOSABLE INCOME resulting in INCREASES SALES$$$. All businesses get this, and generally it far outweighs labor increases, since the number of wage raised consumers (not just those at the minimum wage) by far outnumbers any one employer's workers who are getting wage increases.

Then there's also the fact that many business, while receiving this big SALES boost, do NOT have any wage loss at all. These are businesses who are mom & pop and have no employees, those whose workers are all working just on sales commission (car lots, furniture, real estate, insurance, etc), and third, those with skilled workers (ex. machine shops) whose workers all already get well over $15 hour, or whatever the MW would be raised to.

I think back to when I owned a business. I paid my commission salespeople $350/hour (in 2015 dollars), and they still were only receiving 15% of the sale. In all, I made fine profits and expanded the business. Biggest downer ? All the people who called in and said > "Sorry. I can't afford it." Of course they can't. Not one somebody out there is paying them a low minimum wage. To be successful in business, you have a lot fo things to do. But you can't do anything, if the public around you doesn't have money in their pockets to buy what you're trying to sell.

This is why Conservatives who support raising the MW nationwide, outnumber Conservatives who don't, 54% to 44%.

Why don't they talk about sales, because it's not enough money to make any difference in the grand scheme of things. If you doubled the minimum wage it would only add about $367.68 million pre-tax dollars to the economy, that means squat to a $14.5 trillion dollar economy.

If you have 10 MW workers, and the MW goes up to $10/hour, you couldn't cover that cost increase (easily) with THOUSANDS of MW worker customers in your sales area ? Give me a break. Now just think of all those business who have NO MW WORKERS at all. To whom the increase in disposable income and sales is 100% gain.

When I owned a business, I paid my sales people $150/hour, in th e1980s ($350/hr in 2015 dollars)

PS - you post is empty without source links.

Salary or commission?

Sorry no salesman on the planet gets a guaranteed salary of 312K year

 

[iamwhatiseem]

you don't pay what the worker is worth you pay for what his work is worth in the market.

And there you have it.
Again, I repeat myself........wages are not the issue. There is a place for low wage/part-time jobs in any economy.
The PROBLEM is not what min. wage is. The PROBLEM is there is not enough good paying jobs for the number of people seeking/needing one. PERIOD.
Min. wage jobs are not supposed to support one person let alone a family.

 

[iamwhatiseem]

Salary or commission?

Sorry no salesman on the planet gets a guaranteed salary of 312K year

Where do I apply???

 

[paulitician]

If you can't afford to pay someone Minimum Wage, you don't belong in business. It's real simple in the end, either you do the work yourself, or shut it down.

That's exactly what MW laws are all about.

Workers don't exist to be personal slaves. And no one is forced to hire workers. You don't wanna pay em, do the work yourself. Or get family members to volunteer their time to better your business. Workers are people too. They have bills and families to support.

Agreed. The problem is, none of that matters. None of it.

You can't pay a worker, more than the value of their labor.

Who determines the value of the labor? The customer.

If I'm not willing to pay $50 to have my lawn mowed, then you can't pay the worker $50 to mow the law.

"But they have bills!"

Doesn't matter.

"But they have families!"

Don't care.

"But but HEALTH INSURANCE?!?"

Makes no difference.

The largest cost in most businesses is labor, and thus prices tend to follow the cost of labor. I've certainly seen that in my time. A burrito at Chipotle used to be $4.75, and now it's $6.50. That's a significant increase, that closely follows the increase in the minimum wage.

But eventually, people start choosing alternatives, in relation to price. Again, I've done this. I rarely go to Chipotle anymore, specifically because of the price.

Every business, must inherently, pass all costs onto consumers. As the prices goes up, buying goes down. At some point one of two things happens. Either people are replaced by kiosks, which McDonald's has been pioneering, or they close as we have documented in Seattle.

Right, you don't care. Exactly what i've been saying. So, quit ya bitchin and pay up. Life isn't fair. Deal with it.

 

[paulitician]

Duh. They're gonna raise prices anyway. Minimum Wage has nothing to do with it. It never has.

So you're saying that labor costs have nothing to do with the price of goods and services?

So why don't you open a popcorn business and pay everyone 15 an hour and only sell your popcorn for 50 cents a bag?

Let's see how long you last.

If you can't pay someone Minimum Wage, either do the work yourself, or close up shop. No one forces anyone to hire workers.

I agree; Only the Right likes to complain about Individual Responsibility, but Only when it is about the least wealthy.

Spot On. And i swear, i'll never get why angry white Republican dudes especially, are so angry. I mean they've always had it much better than non-white Americans have. They're so upset and panicked because someone at McDonalds might get $15. It's ridiculous. Such greedy hateful little wankers.

Which brings up racism. That's right; the minimum wage is racist. In this country minimum wage means being white is worth no less than $7.25/hr. How does this work? Like this: If 2 prospective employees--one black, one white, but otherwise equal--apply for a minimum wage job, Mr. AryanFront employer can hire white guy with a crew cut and golf shirt at no financial cost--none. He doesn't even have to worry about his competitors picking up the aspiring black worker for less, because they too have to pay him $7.25/hr. If this black worker were allowed to contract his labor for $5.00/hr, or $7.24 even, choosing the white guy would cost RacistJackass $2.25/hr (or $0.01 depending). Moreover, his competitors, if not racist, have the opportunity to hire the black worker at a cost advantage.

If you think this is not the case, you should check out how the white dominated unions in apartheid South Africa complained that the lack of minimum wage regulations led employers to hire cheap black laborers over better trained and better paid white folks. Which, coincidentally was exactly the same argument (check the congressional record) used by Robert Bacon when he wrote the Davis-Bacon Act (the first minmum wage law) in response to Southern contractors bringing black labor to a federal project in his Long Island district; a labor regulation which forces contractors engaged in government contracts to pay employees union wage scale (unions, which incidently were, at the time, usually exclusively white); effectively barring Southern blacks and immigrants from working on plush, government funded construction projects.

Minimum wage doesn't neccessarily have to be racist; on it's best day, minimum wage is only a state sponsored protection for older, higher paid workers from the competition of anyone who would accept less pay for the same work. The surprise for me was that though I understood that minimum wage and Davis-Bacon were, in observable and measurable effect, racist policies--I just had no idea that they were racist in intent.

So why is it that proponents for statutory minimum wage object to simply basing a worker's wage upon what the worker's work is worth? Why won't they explain their objection to us? Why don't they tell us the reason for refusing to explain their objection?

Maybe the answer is that they're racists. Maybe the're just ashamed to be outed so. Seems legit.

Angry greedy white Republican dudes are just plain ole assholes. Who cares if a McDonalds worker gets $15? Good for them. All the bitchin & moanin coming from the angry white dudes is ridiculous. Get a life for God's sake.