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(Vox)   Raising the minimum wage eliminates jobs. Everyone knows this. Except when it doesn't. Which is often. Here comes the (business) science   (vox.com) divider line
    More: Interesting, Minimum wage, minimum wage laws cost jobs, minimum wage, Arindrajit Dube, federal minimum, recent comprehensive evidence review finds, supply of workers increases, employment growth  
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844 clicks; posted to Business » on 24 Jan 2021 at 11:48 AM (4 weeks ago)   |   Favorite    |   share:  Share on Twitter share via Email Share on Facebook



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2021-01-24 8:21:21 AM  
Isn't it a little early to be submitting headlines drunk?
 
2021-01-24 8:24:12 AM  
CSB. I worked as a waiter in high school. When the state raised the minimum wage, the place just increased its prices a little. No one lost their jobs.
 
2021-01-24 8:26:09 AM  

syrynxx: Isn't it a little early to be submitting headlines drunk?


That's our business model.

/ or is that our modmin model?
// Irish coffee is technically coffee
 
2021-01-24 8:46:01 AM  
Is the cost of living in your area increasing?

If yes, then why wouldn't you raise the minimum wage?

If no, why is your area economically failing?
 
2021-01-24 8:49:40 AM  
When these business creeps say that raising the minimum wage eliminates jobs, what they really mean is "Now that this employee is making four times what I used to pay them, I'm going to fire three people and make that employee perform all four of their jobs at once."
 
2021-01-24 8:54:32 AM  
The Wal-Mart model of paying as little as possible and letting Society pick up the rest really doesn't work, assholes, and we're tired of it.

If you really, really want to have your business subsidized by the government, be prepared to pay sufficient additional taxes that your employees are fully covered at some minimal income level.  Something like a Universal Basic Income, it seems.
 
2021-01-24 8:55:30 AM  

bloobeary: When these business creeps say that raising the minimum wage eliminates jobs, what they really mean is "Now that this employee is making four times what I used to pay them, I'm going to fire three people and make that employee perform all four of their jobs at once."


And then when their business fails because they ran it like an idiot, they will forever hang on to their butthurt about being "driven out of business by big government regulation".
 
2021-01-24 9:04:15 AM  

Moderator: syrynxx: Isn't it a little early to be submitting headlines drunk?

That's our business model.

/ or is that our modmin model?
// Irish coffee is technically coffee


Fark user imageView Full Size
 
2021-01-24 9:06:24 AM  

bloobeary: When these business creeps say that raising the minimum wage eliminates jobs, what they really mean is "Now that this employee is making four times what I used to pay them, I'm going to fire three people and make that employee perform all four of their jobs at once."


i0.wp.comView Full Size
 
2021-01-24 9:12:32 AM  

incendi: bloobeary: When these business creeps say that raising the minimum wage eliminates jobs, what they really mean is "Now that this employee is making four times what I used to pay them, I'm going to fire three people and make that employee perform all four of their jobs at once."

And then when their business fails because they ran it like an idiot, they will forever hang on to their butthurt about being "driven out of business by big government regulation".


i1.wp.comView Full Size
 
2021-01-24 9:13:25 AM  
Let's stop pretending like anything above minimum wage is a burden for most businesses.  Profits are at all time highs.  The investor class has so much money they dont know what to do with it.  They can spare the extra pennies out of their pockets so the rest of us dont starve.
 
2021-01-24 9:22:57 AM  
Capitalists make more money when they have to pay fewer workers.  They should welcome a pay increase for the work force, they'll be able to get more with less.  And that's what screwing people over is all about.
 
2021-01-24 9:29:11 AM  
I hate this "debate" so much. It's really really stupid.

Raise the f*cking minimum wage and shut up.

If we see 20% unemployment and crack babies return, we might have some issues.

Barring that, pay your f*cking workers and stop being drama queens.
 
2021-01-24 9:32:38 AM  
RE:  Min wage increase will crush some businesses - No oh fark no, cost of living increases everywhere.

Now there is one corner case that I'm aware of and that's where you have the prices of goods sold by a franchise determined at some national level instead of based on regional COL.  Those corner cases need to be addressed internally within that company, don't screw over the workers because of that short-sighted decision.
 
2021-01-24 9:38:12 AM  
The minimum wage is obviously far too low, but there's a huge difference between a corporation with dozens to thousands of locations, making record profits, and small businesses clinging to existence.  Especially during the Plague Times.

It's easy to say that if a business can't afford to pay its employees whatever, then it doesn't deserve to exist, but darwinism is a sharp knife that cuts without caring -- it's not that different from saying that if you can't afford to feed your kids and send them to college, you shouldn't have had kids.  For one thing, it's unfair, from all sides, to the kids.

I manage a two-location ten-employee retail business where no one gets less than $10 an hour, but if we had to raise everyone to $15 an hour (which would be a raise for me, even), we'd have to lose two or three employees . . . and probably we'd go out of business with that reduced staffing.  We've been in business for over fifty years.  What we do is considered a community service by most of our customers, who generally tell us it's a shame there aren't more businesses like ours.  It's just not a high-revenue thing.  The owner isn't rich, either.  We sell books, even Jeff Bezos doesn't get rich selling books.

I wouldn't want an exception for small businesses.  What I'd prefer is to see federal income and payroll taxes cut for anyone making, say, under $35k a year, or on a sliding scale up to $50k.  Just remove the SS exception for high-earners.  Then we could give our employees a minimum of $12 an hour, no sweat, and their after-tax income would jump another 15%.

If we had opt-in real universal healthcare, it'd make a world of difference, too.
 
2021-01-24 9:38:46 AM  
Idiots: "increasing the minimum wage increases the cost of living."

Reality: the cost of living increases regardless.
 
2021-01-24 9:40:41 AM  
Being a native of economies before the 17th century, I really believe anyone who can be enslaved by superior capital or technology, usually both, should be. And no one should ever negotiate on behalf of the disempowered.
 
2021-01-24 9:48:09 AM  

Urmuf Hamer: Being a native of economies before the 17th century, I really believe anyone who can be enslaved by superior capital or technology, usually both, should be. And no one should ever negotiate on behalf of the disempowered.


Wow, you're really old
 
2021-01-24 9:48:55 AM  

cameroncrazy1984: Urmuf Hamer: Being a native of economies before the 17th century, I really believe anyone who can be enslaved by superior capital or technology, usually both, should be. And no one should ever negotiate on behalf of the disempowered.

Wow, you're really old


Seems like just the other day.
 
2021-01-24 9:49:46 AM  
You should be able to pay your rent and feed your family if you're doing 40 hours of productive work a week, full stop.
 
2021-01-24 9:49:59 AM  
Here's a novel idea: Pay people what they're worth.

Use the essential worker covid lists to decide on that worth.
 
2021-01-24 10:02:10 AM  

RandomAxe: I manage a two-location ten-employee retail business where no one gets less than $10 an hour, but if we had to raise everyone to $15 an hour (which would be a raise for me, even), we'd have to lose two or three employees . . . and probably we'd go out of business with that reduced staffing.


Obviously, the market for book sellers in your area is not profitable enough to pay a (basic) living wage. That's market economics, nothing personal. If you want to afford to pay your workers (and yourself) more, than you need to diversify your product line. One of the ways many bookstores have been able to stay afloat is to add things like in-house coffee shops or small bakeries, just as a couple of ideas.

It's one thing to have one of those "there should be more of these" type businesses, but the fact that there aren't "more of these" is indicative that the market barely even supports what there is. The point is the demand is just not there, not that a $15 minimum wage will "kill" your business. Because if a few dollars more an hour forces you out of business, you have a failing business model.
 
2021-01-24 10:06:29 AM  

koder: Idiots: "increasing the minimum wage increases the cost of living."

Reality: the cost of living increases regardless.


Trying to explain inflation to people can sometimes be like trying explain quantum mechanics. Sometimes this works.

Fark user imageView Full Size

Fark user imageView Full Size
 
2021-01-24 10:07:45 AM  

Threp: Here's a novel idea: Pay people what they're worth.

Use the essential worker covid lists to decide on that worth.


It's a lovely idea, but you have to start by redistributing wealth, because the people at the top make far more than they're worth.

A vast proportion of restaurants massively underpay a huge proportion of their staff . . . and hover on the edge of bankruptcy every month.  There are management problems -- a lot of small businesses are run by enthusiasts, not business people, which has its good and bad points -- but the single main problem is inflation and wage starvation.  The customer base does not have the kind of disposable income at hand and does not see the value of the goods and service, because of inflation and wage starvation and corporatization.

In constant dollars, wages for most workers in the US basically haven't gone up since about 1970.  Meanwhile, a lack of regulation means that a massive corporation can rake in profits while offering what seems like cheap food (McDonald's, say), which means if a small restaurant has to charge $20 for a fairly simple meal in order to pay servers $10 an hour, it looks wildly overpriced.  But, really, the issue is that the customers don't have enough discretionary income. 

The market is heavily distorted in all kinds of ways, and if you make less than six figures you're probably getting screwed in a dozen directions.  But stacking the deck further against small businesses will make it worse, not better.  The discretionary consumer margin has to go up first.  A universal guaranteed income would be better than hiking the minimum wage, which is a clunky regulation on a skewed capitalist model in the first place.
 
2021-01-24 10:11:58 AM  

Man On A Mission: RandomAxe: I manage a two-location ten-employee retail business where no one gets less than $10 an hour, but if we had to raise everyone to $15 an hour (which would be a raise for me, even), we'd have to lose two or three employees . . . and probably we'd go out of business with that reduced staffing.

Obviously, the market for book sellers in your area is not profitable enough to pay a (basic) living wage. That's market economics, nothing personal.


If you simply think the market ought to be whatever the market ought to be, you're never gonna fix a thing, my friend.  Darwinism is killing you, too, whether you see it or not.  That's how it works.

Our issue isn't a lack of customers or a lack of demand or a lack of popularity or low visibility.  It's that our customers don't have the money to buy as much of our products as they'd like, even though we charge less than our competitors (who are also going out of business).  We compete just fine with Amazon on prices and offer tons of services Amazon doesn't.  Our customers don't have enough money in the first place.

Raising wages would theoretically boost consumer spending, yes, but the small businesses die during the transition time, and then you're just pumping more money into Amazon, which will not help the working classes the way raising the wages is meant to.
 
2021-01-24 10:16:16 AM  
Productivity has also gone up much more than wages have. By just about every metric we have, wages are below where they should be.
 
2021-01-24 10:24:33 AM  
if they didn't let the minimum wage fall so far behind over the years then it wouldn't seem like such a shock
 
2021-01-24 10:27:09 AM  

RandomAxe: our customers don't have the money to buy as much of our products as they'd like, even though we charge less than our competitors


Again, more proof that your business model isn't workable. This has nothing to do with you or your customers, it's simple economics.

RandomAxe: Raising wages would theoretically boost consumer spending, yes, but the small businesses die during the transition time, and then you're just pumping more money into Amazon, which will not help the working classes the way raising the wages is meant to.


Except that Amazon workers would also be getting a raise (and there are a LOT more of them), so the net economic benefit of having a small business fail due to a non-sustainable business model in favor of a large employer who has a sustainable business model is better for the economic health of the country.

Bottom line: if a company can't afford to pay their workers a base living wage, then they are part of the economic problem.
 
2021-01-24 10:42:38 AM  
And how is not raising it even remotely considered a good idea during what we are experiencing?

Their attempt at pearl clutching to not help is class warfare.
 
2021-01-24 10:45:07 AM  

RandomAxe: It's a lovely idea, but you have to start by redistributing wealth, because the people at the top make far more than they're worth.


No disagreement from me. Let's get on with it.
 
2021-01-24 10:50:42 AM  

Man On A Mission: RandomAxe: our customers don't have the money to buy as much of our products as they'd like, even though we charge less than our competitors

Again, more proof that your business model isn't workable. This has nothing to do with you or your customers, it's simple economics.

RandomAxe: Raising wages would theoretically boost consumer spending, yes, but the small businesses die during the transition time, and then you're just pumping more money into Amazon, which will not help the working classes the way raising the wages is meant to.

Except that Amazon workers would also be getting a raise (and there are a LOT more of them), so the net economic benefit of having a small business fail due to a non-sustainable business model in favor of a large employer who has a sustainable business model is better for the economic health of the country.

Bottom line: if a company can't afford to pay their workers a base living wage, then they are part of the economic problem.


One could argue that if small businesses have to be subsidized by our tax dollars then they're unsustainable anyway.
 
2021-01-24 10:58:05 AM  

Man On A Mission: That's market economics, nothing personal.

Man On A Mission: a failing business model

Man On A Mission: it's simple economics

Man On A Mission: if a company can't afford to pay their workers a base living wage, then they are part of the economic problem


I think it is very important that we hold accountable the individuals at the bottom of the complex and unpredictable global economic supply chain which is dominated by a tiny handful of individuals, and that is rapidly transformed by new technologies that otherwise clash with human cognition, as we expect those individuals to pocket new skills and develop new interests purely to suit the needs of the system, rather than the people who are a part of it.

This may or may not be because I have an emotional investment in playing for the Donkey Kong world record, but with my bank account.

Please note that this is also what I tell the individuals on neighboring planets when a black hole emerges in their galaxy and it consumes their entire solar system, shredding their corpse at the molecular level as they become indistinguishable matter in a supermassive entity.  It is their fault for refusing to build a space program and escaping into darkness.  They just didn't want to work hard.
 
2021-01-24 11:38:01 AM  
Man On A Mission: Again, more proof that your business model isn't workable. This has nothing to do with you or your customers, it's simple economics.

Sure, man.  Whatever half-applied concept comforts you by assuring you it can't hurt you.  I mean, this mysterious unmanipulated market surely should not be manipulated further in any way that might benefit society at large.  It's just simple economics!  However things happen to be right now, that's how they always should've been.  Sure.
 
2021-01-24 11:41:16 AM  
cameroncrazy1984: One could argue that if small businesses have to be subsidized by our tax dollars then they're unsustainable anyway.

Many people do argue this, usually rather ignoring that it's an argument against permitting, say, incorporation, or allowing corporations to freely use any public resource -- roads, public utilities, subsidized telecommunications, Treasury-backed currency, the courts, the protections of police, fire departments, the military . . . .

There's no such thing as a free market.  The issue of regulation is who benefits, how it's enacted, how it's policed, how it's enforced, and how much.  People who are against regulation are basically people in favor of wildfires.  Wildfires are good for some real estate speculators, for instance, but not for most people.
 
2021-01-24 11:54:14 AM  
I don't know who first coin the idea that raising the minimum wage would cause mass unemployment but the GOP has gotten some excellent mileage out of that long since disproven bullshiat.
 
2021-01-24 12:00:17 PM  

RandomAxe: Man On A Mission: Again, more proof that your business model isn't workable. This has nothing to do with you or your customers, it's simple economics.

Sure, man.  Whatever half-applied concept comforts you by assuring you it can't hurt you.  I mean, this mysterious unmanipulated market surely should not be manipulated further in any way that might benefit society at large.  It's just simple economics!  However things happen to be right now, that's how they always should've been.  Sure.


Well if you're okay with profiting off underpaying your labor. Personally, I find that oppressive, but you gotta do you.
 
2021-01-24 12:02:43 PM  
csb/

(I've told this story before) A former co-worker who had an MBA (*chuckle*) argued with me that monopolies are not bad, because they give people what they want.  He also tried to 'splain to me how Libertarianism isn't what people think, blah, blah, blah.  Remember, I said he has an MBA, which is important because, "...and my group set out to prove raising the minimum wage is detrimental to workers as well as businesses.  Our professor was impressed that our hypothesis was  correct."

Yeah, I didn't buy off  on his brand of crazy, either.

It was funny listening to him biatch about his cable provider.  You know, monopolies are good.  He biatched about government while always working as a contracted IT resource for a few state agencies.

/csb


/He broke the irony meter in many ways.
 
2021-01-24 12:04:44 PM  

Chief Superintendent Lookout: and my group set out to prove raising the minimum wage is detrimental to workers as well as businesses.  Our professor was impressed that our hypothesis was  correct


Most of the MBA students in my class nearly flunked the finance course because they sucked at math. As a solution, the professor put everyone into groups for projects -- and each group had one math person who pretty much did all the work.
 
2021-01-24 12:07:11 PM  

Chief Superintendent Lookout: monopolies are good


The only people who think that are those who run or are employed by a monopoly.

Remember that outage a few weeks ago when every single Google service was done? Well, that demonstrates what happens when you rely on one company for everything.
 
2021-01-24 12:08:15 PM  
Phil Gramm had an anecdote he liked to share about his friend, Joe the Janitor, who worked at UT and lost his job because of minimum wage laws.

It was a lie. UT always paid its janitors triple the minimum wage.  These lies have never left the GOP.
 
2021-01-24 12:13:22 PM  

RandomAxe: tail business where no one gets less than $10 an hour, but if we had to raise everyone to $15 an hour (which would be a raise for me, even), we'd have to lose two or three employees . . . and probably we'd go out of business with that reduced staffing. We've been in business for over fifty years. What we do is considered a community service by most of our customers, who generally tell us it's a shame there aren't more businesses like ours. It's just not a high-revenue thing. The owner isn't rich, either. We sell books, even Jeff Bezos doesn't get rich selling books.

I wouldn't want an exception for small businesses. What I'd prefer is to see federal income and payroll taxes cut for anyone making, say, under $35k a year, or on a sliding scale up to $50k. Just remove the SS exception for high-earners. Then we could give our employees a minimum of $12 an hour, no sweat, and their after-tax income would jump another 15%.

If we had opt-in real universal healthcare, it'd make a world of difference, too.


Places like that make me wonder if there should be something like the payroll protections loans, with the government supporting the increases in min wage for small businesses. But only if the businesses agree to a payroll audit and the owners/ceos/execs aren't making like 20 to 2000 times what the average worker is.  Mcdonalds, Wal-marts, and Disney need not apply.
 
2021-01-24 12:20:50 PM  

bostonguy: CSB. I worked as a waiter in high school. When the state raised the minimum wage, the place just increased its prices a little. No one lost their jobs.


Seattle raised their minimum wage years ago and the economy grew and unemployment declined.
/But Ayn Rand
 
2021-01-24 12:21:50 PM  

bostonguy: CSB. I worked as a waiter in high school. When the state raised the minimum wage, the place just increased its prices a little. No one lost their jobs.


And major league baseball got minor league farm teams exempt from minimum wage and now most of them are going bankrupt and all jobs lost.
 
2021-01-24 12:35:28 PM  

koder: Idiots: "increasing the minimum wage increases the cost of living."

Reality: the cost of living increases regardless.


Wrong! The price of food compared to a family's income is no longer a third of the family budget. The cost of living keeps on going up because our government has a spending habit higher than its tax revenue (which is at an all-time high) and the cost of what people think are essentials (cable, Internet, cell, XBox Live) keeps going up. Hell, even gasoline is a bargin compared to what it was in the early 1980s.
 
2021-01-24 12:53:49 PM  
No worries, the jobs that would have been at risk are already gone.
 
2021-01-24 1:00:13 PM  
I love to hear $15 an hour when working for an automation company.
 
2021-01-24 1:09:45 PM  

Catsaregreen: The price of food compared to a family's income is no longer a third of the family budget.


Food used to be more expensive than housing. Now, housing is a lot more expensive than food.
 
2021-01-24 1:41:40 PM  
I've always felt it's not the minimum wage folk who businesses are concerned with, it's their mid level folk. Cause if this goes through, those folk who were making double min wage are no longer beholden to that paycheck and have less incentive to stay. Management is always terrified that they may have to treat employees better and be competitive again on something besides a paycheck.
 
2021-01-24 1:53:05 PM  

GodComplex: I've always felt it's not the minimum wage folk who businesses are concerned with, it's their mid level folk. Cause if this goes through, those folk who were making double min wage are no longer beholden to that paycheck and have less incentive to stay. Management is always terrified that they may have to treat employees better and be competitive again on something besides a paycheck.


Which is where that completely vile 'salary == unlimited amounts of your time' needs to be kicked to the curb as well.  Its a ridiculous concept that should never have been allowed to take root, the temporarily embarrassed millionaires who support it need to be brought to heel with stronger labour laws, maybe now that the US in full control of the adults for a couple years there's another shot it'll happen this time.
 
2021-01-24 1:54:36 PM  

evilsofa: Is the cost of living in your area increasing?

If yes, then why wouldn't you raise the minimum wage?

If no, why is your area economically failing?


Is the minimum wage increasing?
Then why wouldn't you raise prices to cover your costs and get a slice of that pie?
 
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