Grueling. I still remember solitary frustration of mopping the floor, hearing a "pop" above me, being showered by broken glass, and realizing that I had jammed the mop handle into one of the large glass globes around a light fixture.
That was one summer.
A few bad jobs later — junior counselor at a summer camp, moving cardboard boxes in a warehouse for J.C. Penney — I became a baker at Bob Evans, a restaurant that prided itself in its biscuits. I would stand at a table in the middle of the kitchen and whip up biscuits. One busy Sunday I baked 250 pounds worth.
The guy at the dish tank was named Wayne. I can still see him — the back of his head anyway. Crew cut, black plastic glasses held on by an elastic band. He'd stand at the long stainless steel sink, throw the dirty dishes into a big square rack, hose them down with a sprayer dangling on a metal hose. Pull up the metal door, steam billowing out, push the dirty rack in, the glistening clean rack sliding out the other side
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Setting a minimum wage is all well and good, but it also sets a lower limit on employability. Adding in the FICA and other expenses, the minimum cost for an employee will become $18 dollars an hour. If the operating profit margin is 10%, a minimum wage employee will need to generate $180 per hour in additional sales, in order for the business owner to merely break even. Just be cognizant of the fact that if a person has a mental and/or physical disability and cannot reach that level of productivity, as a matter of law we have rendered them unemployable. As noted in the movie "Falling Down", they are no longer economically viable.ReplyDelete
That only looks at one side of the equasion. The increase of earned income by people who are not in a position to put it away in savings creates more demand for goods and services. Hence more business, requiring more employees, even at the higher wage. It might end up being a wash. Economics 101.Delete
Always love it when those in charge maintain that "what we're doing is really for your benefit."Delete
Tom, you are more intelligent than you give yourself credit for, as is your wont. It would be more appropriate to have the topic you raise discussed at the Graduate level, in a class like Macroeconomics 501. Now if someone could derive an equation that would input prevailing economic conditions, and calculate the optimal minimum wage to expand the middle class, that in my opinion would be very worthy of a PHD dissertation. John, since I'm not advocating any mandates on others, I take it you agree with me. Politicians who pull numbers out of their ass, need to ponder all the possible unintended consequences before they turn their ideas into laws.Delete
I would not assert that such a calculation is easy, or even possible, although the problem has been modeled. However, I repeat, the principles are Economics 101. People who speak for the business community naturally focus on the cost of doing business, which can affect profits as well as employment levels, but doing so while ignoring the benefit side is propaganda, not economics. I did,incidentally,learn quite a bit about how capitalism in our nation works growing up in my parents neighborhood grocery store. Enough to both admire people who persist in running such small enterprises and decline to follow in their footsteps.Delete
At least you used a more relevant photo to illustrate this.ReplyDelete
The Sun-Times used a photo of demonstrators outside the NY State Capital Building in Albany.
Bernie, the employer only pays half of the FICA and Medicare, hence the cost would be about $16.50 per hour.ReplyDelete
Hi Sergio, thanks for giving my premise some serious thought, and helping people get a clearer understanding of how capitalism in our nation works. You are of course correct, but I also padded the number with a ballpark calculation of workman's comp., head tax if you have enough employees, and the increase in premium for liability insurance generated by the additional revenue. An unstated assumption in my example is this would be for a part time job. A full time job may mean the mandates for an employer in the Affordable Care Act would kick in. Now if you can provide a calculation for that additional cost, I would be most impressed.Delete
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Oops, I forgot the mention the padding included the quarterly payment to the Illinois Department of Employment Security, which covers unemployment. Now for those who get their jollies from seeing the rich get screwed, I have some good news. A business owner has to pay a percentage of his/her no doubt too fat paycheck to the IDES. But since they can't fire themselves they can never collect the unemployment they are paying for!Delete
Bernie- the apologist for condescending, Republican, excuse making- forum is somewhere else. ;)Delete
Bernie, you also forgot that a self-employed person pays all of the FICA & Medicare tax.Delete
I'm replying for MCN, who hasn't commented anywhere for a couple of years.& who always managed to complain about this one;)
This is a different point but usually unemployment benefits are for lack or work/layoffs, not firing.ReplyDelete
I think my favorite Walter Reuther story might be apt here: on a tour of a auto plant, Mr. Reuther was told gleefully by a company representative that the robotic machinery recently installed didn't pay union dues. Reuther immediately replied, "And they don't buy cars either."ReplyDelete
Good one, Tate.ReplyDelete
The problem with the artificial $15/hr wage for entry level positions is that it is not supported by free market supply and demand forces. What will probably happen is companies will reduce their staffs and possibly opt for automated solutions to stay competitive. Anotherimpact will be on positions that currently earn $15/hr.I'm sure those workers will demand raises or compete for the entry level positions.ReplyDelete