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Raise in Minimum Wage

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I’m coming to ask for the collective wisdom from the BAD community regarding the latest news on the minimum wage. You can read an article HERE posted by NBC regarding the gradual increase of the minimum wage to $15 per hour.

This news led to an interesting discussion with Gymnast last night at dinner. Who knew my 14 year old was paying much attention to the economic news. (Of course, he is determined that his future is going to be in the upper echelons of financial success so maybe this attention makes sense.)

 

Gymnast at dinner last evening as we discussed economics and life. And savings and work ethic.

What does the Increase in Minimum Wage Mean?

We talked about how the minimum wage increase will lead to higher costs. We walked about the burden on small business owners. And we talked about the differences between state laws and federal laws.

I was very ill-prepared for this kind of conversation. And I felt like coming to this community of very smart and financially literal people might help me contribute to his knowledge more appropriately then my stumbling and bumbling thoughts this evening.

So tell me, what are your thoughts on the Increase to Minimum Wage? What do you think about the plan to implement it? What do you think about the current minimum wage in your state? I looked up Georgia’s…if a worker is not protected under the Fair Labor Standards Act (FLSA) the minimum wage is $5.15. Yikes!

I’m not sure how I feel. I understand the need, in some cases, for a minimum wage. But on the other hand, I am one who believes that most anyone can be anything they want to be. If someone wants to make more money, they can get educated on skills, work hard to move up, seek mentors that will assist them in growing their potential, etc.

As a small business owner, I can see the burden that a nearly doubled minimum wage can place on businesses. And see how that can force an increase on the cost of goods.

Now please, share with me your thoughts on the minimum wage increase and what we can expect to see as the result.


38 Comments

  • Reply steveark |

    Our minimum wage is $9.50. I don’t think the government should dictate anyone’s wages, leave it to the market to self regulate.

    • Reply Cwaltz |

      Yes, because the market is doing a wonderful job regulating itself. That’s why we never have oil spills that pollute our oceans or banks that sign people up for financial services they did not want
      . It’s why insurance companies don’t kick people off their insurance for cancer treatments by way of an old acne diagnosis.God bless self regulation. By the way, the labor asking for the wage is part of that market. So this idea that wage increases that don’t benefit business owners is somehow not a market reaction is b.s.

    • Reply Kerry |

      Let me guess, you also think unions are illegal and the National Labor Rights Board should be abolished, and the Department of Labor is unnecessary…

  • Reply Sue |

    Our is rising to $12/hr and small businesses are already saying they’ll have to cut back staff. This is an unpopular opinion but I think minimum wage jobs were never meant to support a family on. They are entry level until you can gain the experience, skills, or education to move up.

  • Reply Cwaltz |

    If your business model lives and dies in a single line item than you probably should look carefully at it.

    If you want to tell your son about minimum wages than I might suggest the CBO report that lays out not just the cons but also the pros of increasing the wage.

    Personally I’d like to see the wage indexed for inflation. It’s tiresome to see the most financially vulnerable become a political football each political cycle. I’m in agreement with why it was enacted in the first place which was to allow any person working a full time position to have enough money to pay for items like housing, health care, food and other basics with a little left over to save for something whether that something be a vacation, a house, retirement or a million other things that used to be part of the American Dream. I think it says something about the wage that something like housing is unaffordable for a good portion of Americans. Using an affordable housing formula for a house essentially if you make $10 an hour your housing should cost around $440. Good luck finding housing for that. People than say the most vulnerable should “double up” however that presents problems if the person you double up with gets let go of does not have good financial habits to begin with. People also cite education as a panacea. The problem is it is not free(as you well know)We now have trillions in student loan debt which makes our economy vulnerable(it’s why we are now talking about student loan forgiveness) and sending someone to school does not guarantee them employment for the wage they need to be able to pay it back. The problem is way more complicated than the pithy lines both sides tend to throw at it when debating it. In short, I am FOR increasing the wage. I am FOR indexing it so it becomes less of a political football. I am FOR making schooling affordable and including some of its cost in the taxes I pay. I like the idea of skilled labor. These things help people succeed and I am all for helping those in the bottom up the ladder rungs.

  • Reply Louise |

    The minimum wage in Australia is currently $19.49 per hour. That’s the federal figure. Our economy functions and we have thriving small to medium size businesses (my client base). So I don’t really understand the panic in the US about people being paid a living wage for their work.

  • Reply Julie |

    Both the Republican Senate and the President are opposed to increasing the federal minimum wage, so nothing is going to happen until Nov 2020 at the earliest.

    To learn about the possible effects of a higher minimum wage, I second the suggestion made above to read the summary of the recent CBO report. You can find it by googling “The Effects on Employment and Family Income of Increasing the Federal Minimum Wage”.

  • Reply SMS |

    There are far too many people in this country who work full time and still cannot afford housing. IMHO that should be the issue. It is shameful. I am surprised that does not figure into your reflections, Hope, having been so close to homelessness yourself. We need a higher minimum wage. We Americans believe so deeply in pulling yourself up by the bootstraps, but a person working to move up still needs to earn enough for food and a place to sleep.

    • Reply Deb |

      You make a good point about wages and housing. I do feel that the minimun wage should be higher for folks. In earlier years it was meant as a stepping stone for teenagers an 20 somethings to get them out into the work force. These jobs were not intended to be for adults with mortgage payments and rental costs but now these are the folks who are working the jobs. I worked a LOT of minimun wage jobs before deciding to go to nursing school. My husband also worked these same jobs while our children were young. It was very difficult to make sure that there was some cash put aside for an emergency such as a broken down car let alone the potential to have to find additional housing. Am I thankful that my husband and I had jobs? Any jobs? Yep. We would not have successed without the support of food stamps, medicaid for the kids when they were young, and wic vouchers. We also lived with family for a few years when the kids were toddlers and preschoolers.

      Shelter, food, electric, gas, water, and a proper running vehicle are difficult to maintain on a minimun wage job. There are many folks who are able to manage but they may have two or more jobs to ensure that their bills get paid. Let’s not forgot those who are homeless or do not have a working vehicle as barriers to “pull them up by the bootstraps” hence they fall between the cracks and are often left behind due to limited or no resources.

      People work any job that they can find to support themselves or their family to keep a roof over their heads, feed themselves, and do the best they can with what they are given even if it means that the best that they can do on any given day is to get out of bed and go to work.

    • Reply Hope |

      It’s included in my current budget…our cash allowance covers groceries and entertainment. Our $10 dinner can quality as both, I suppose.

      • Reply Laura |

        $10 for dinner for 2 in a sit down restaurant? Actions speak louder than words. I’m sure your son is aware of this spending and absorbs how money reflect personal ethics.

        In this sort of minimum wage discussion, it might be helpful to balance the concern of “my consumer prices will go up!” with the concerns of a sushi chef (often with significant training), a waitress (who is on her feet for a full day, usually making about $2.25/hour even with minimum wage laws), and the busser/dishwasher (who sure surely can’t be paid above minimum wage on a $10 bill, split across all staff and supplies and leases and taxes). It’s worth thinking about that balance in this discussion.

      • Reply Deb |

        I wonder how many 10 dollar dinners had to be bought to pay the employees for their hourly wages at the resturant?

  • Reply Jen |

    Of course you’re against something that would have directly benefited you in the past. Don’t you remember when you wouldn’t take a $10/hr job because you couldn’t meet your expenses with it?

    • Reply Hope |

      IMO, most “minimum wage” jobs are for teens, college students, etc. People starting out with no specialized training or skills. I don’t think minimum wage jobs were meant to support a family on.

      • Reply Jen |

        Just because you don’t think they weren’t meant to support a family doesn’t mean that people don’t support families on it. And it completely ignores my point that when you didn’t have sufficient income and NEEDED to support your family, those were the types of jobs that were available. Yet you just went “well, I can’t meet my expenses with it, so I won’t even try”.

      • Reply Jen |

        And yet you’ve been in a position where you NEEDED income, any income, to support your family. But you turned up your nose at even the possibility of a lower-wage job because you couldn’t meet your expenses with such a job.

        Just because you feel above such jobs, that they are for “unskilled” people and teenager (and I’m willing to bet your un-said definition also includes “lazy”) does not mean that people don’t support themselves and their families with such jobs.

        You do the best with the hand you are dealt. If that means taking a minimum-wage job because that’s al you can get, that’s what you do.

      • Reply Drmaddog |

        And yet many families are having to do just that – try to support a family on a string of minimum wage, no benefit jobs. It’s a misconception that only teens or college students are working those type of jobs.

      • Reply Katie |

        That’s your opinion. That’s not the reality of who is working for minimum wage. There is a lot of data on who is working for minimum wage, and it’s not entry-level teens. I wish people would let go of that antiquated assumption. Also, if you’re working 40 hours a week, I don’t care what it is that you’re doing, you should be earning enough to afford housing, food, utilities, etc. that’s living in a just society. And, we all end up subsidizing those business owners who pay minimum wage. We are paying through Medicaid, SNAP, tax credits, tip jars, go fund me campaigns, etc. So, I resent that I’m picking up the tab for them. Also, there are plenty of studies on what has happened in places that have raised it, and none of the cries of “Oh, prices will go up!” have resulted.

        • Reply Drmaddog |

          YES YES YES. All those billions the Waltons make are subsidized by the American taxpayer when their workers have to get food stamps and welfare because the wages are so low. But hey as long as Walmart has a fatter bottom line right.

      • Reply Cheryl |

        That may have been true before the 2008 recession but many adults couldn’t find work and are now working in minimum wage jobs. You do what is necessary to live and feed your family.

      • Reply Cwaltz |

        In my area a lot of these jobs are filled by older people who unfortunately do not seem prepared for retirement. I know I remember reading that McDonald’s is actively recruiting older Americans as well. Furthermore, college she kids deserve a living wage so they can actually pay for schooling instead of having to take out loans that require them to pay out hundreds a month in student loans.

    • Reply Janet |

      Jen you are my favorite commenter on BAD. And I remember when Hope was turning down jobs left and right because they didn’t pay enough to cover her expenses. Some $ is better than no $, not sure what’s so hard to grasp there. Cheryl is on point about the recession. When my father was laid off, he supported the family in-between corporate jobs by delivering pizza! You do what you have to do to support your family financially, period. Something Hope can’t seem to grasp. It’s the same story over and over and revolving debt, she will never be debt free, a bit of a pointless blogger here at BAD if you ask me.

      • Reply Jen |

        Thanks, I get torn to shreds often enough for calling Hope on her bull by her sycophants. I’m glad to see other people see the light.

  • Reply Ashley |

    I hate the idea of raising minimum wage to $15. If that were to happen, fast food workers would have a better life which is great, but a lot of the middle of the road jobs that make ~$40k a year would not see an increase. Police officers, teachers, 911 dispatchers most likely wouldn’t get a raise. When I was a high school teacher, I made $20ish/hr. If I could make $15-20 minimum wage working retail I would never go through the stress of being a teacher. (And I say that as someone who has worked retail and food business. I know retail/restaurants can be stressful but the stress is contained in your shift, you aren’t expected to work at home like teachers are). Likewise, why would a police officer put their life on the line when they could flip burgers for close to the same wage.

    • Reply Laura |

      Because some people genuinely want to make the world a better place and do more with their lives?

    • Reply Megan |

      I am not sure why your argument isn’t that teachers and police officer should also earn more. They should. That is difficult, valuable work for both. And I think the people choosing that work aren’t doing it to make more than someone at McDonald’s. They do it because they feel the work is valuable. Especially right now with all of the stresses teachers face for low pay.

      It sounds like you think retail or food industry work is somehow not an honorable way to support your family when you make those sorts of comparisons. And I don’t think that is really what you mean.

      • Reply Drmaddog |

        Exactly. And those at the top love the arguments about ‘why should THEY make $15 when I only make $20’ rather than arguing for higher wages for all because it keeps the focus away from just how uneven the distribution of wealth is in this country.

      • Reply Ashley |

        I am not saying working a retail or restaurant job is not an honorable way to support a family. In fact, if I could make a similar salary working retail as I made as a teacher, I would do it in a heart beat. I am in no way shaming that line of work. What I was trying to convey is that it sounds great to say “raise minimum wage”. It would help those who are working minimum wage jobs but a corresponding increase for middle wage jobs is not guaranteed to happen and I don’t think would actually happen. Because of that I think a minimum wage of 15-20$ would result in a mass exodus of people leaving career fields like teaching, social work, police, fire fighter.

        • Reply Laura |

          Have you worked in retail? It’s not just folding shirts and pushing cash register buttons for 40 hours a week. Often it’s a lot of time on your feet, swamped with customer complaints and drama, comes with erratic hours that change week to week and make things like childcare very difficult, includes weekend shifts, almost never includes benefits, and is usually under 32 hours a week to save the company money overall by cutting requirements like health care.

          If my choice were to be a teacher with full benefits or an at will retail employee piecing together misc hours for the same pay, you bettering believe I’m taking the job you’re ready to ditch.

        • Reply Kate |

          If this results in a mass exodus of people leaving career fields like teaching, social work, police, fire fighter- guess whats going to happen? Those wages are going to go up too. Needs and lack of resources (in this case qualified people) drive cost.

          The fact that CEOs and high level management have managed to make people angry at the $15 dollar burger flipper instead of having better living wages for all employees is the greatest joke they ever played on the population. Wake up.

    • Reply Cwaltz |

      I have had the opposite experience. While it was more mentally taxing to prepare IVs, it was less stressful than an entry level position. Because the jobs pay less you don’t have staff to cover all the areas so you are on your feet all day taking care of customer needs and the job is pretty thankless.

  • Reply Cheryl |

    My question is when are you going to show your debt, how you are able to drive your daughter to school without your own car, buy her a car, and what about healthcare?

  • Reply Rrr |

    As a landlord, I would charge more if the minimum raise was increased to $15. The tenants should be able to afford it so why shouldn’t I also get an increase? I deserve a raise for my hard work too.

  • Reply Kate |

    I’m late to this post but recently was listening to this podcast which you might enjoy: https://thefairercents.com/2019/05/15/30-personal-responsibility-vs-systemic-realities/

    They talk about how in the US we tend to greatly overestimate the possibility of changing your social status, while in Europe people underestimate social mobility, even though people in Europe are much more likely to be able to move up due to free college, healthcare, better public transport etc.

So, what do you think ?