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Job loss predictions over rising minimum wages haven't come true

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Re: Job loss predictions over rising minimum wages haven't come true

#71

Post by hinkley »

sobhaobnONJ wrote: post #57
mullingitover wrote: post #9

Minimum wage isn't just flat for a decade, it's not being adjusted for inflation. This means minimum wage workers have been getting a pay cut over time. The debate isn't just whether we should raise minimum wage, it's whether we should be cutting it. By allowing it to remain stagnant we're making the default decision to cut.

I don't understand why this isn't a red herring. Minimum wage may be remaining stagnant but total employee compensation has been rising steadily, it's just that most of that compensation is in the form of spending on employee benefits like insurance. If people quit expecting employers to provide them with anything except for cold hard cash then you'd likely see wages increasing with time. To expand a bit more on this…

It's rare for a company to offer health insurance to employees who are pegged to minimum wage.

If salaries are going down due to inflation, then you may have a point but it's a perverse one; medical costs are going up way faster than anything else.

Both are reasons to support socialized medical coverage, but they don't really enter into this particular line of discussion.

Re: Job loss predictions over rising minimum wages haven't come true

#72

Post by sobhaobnONJ »

FabHK wrote: post #30
atypicality wrote: post #2

Axios cherry picked the Bureau of Labor Statistics data for the 12 states that confirm the writer's bias. They should have analyzed all states with low minimum wages vs high minimum wages for the overall picture. Reports are out there showing while many of the minimum wage earners who have not lost jobs from the hourly increase are reporting weekly scheduled hours being cut back across the board.

> weekly scheduled hours being cut back across the board. So you're saying the minimum wage laws are leading to more jobs? (If everyone works less, then more people must presumably be hired.)

The people being hired are not the ones having their hours scaled back. If demand for labor rises at a natural average over time in an area then minimum wage could reduce scheduled hours while overall growth still creates job demand. It'd be more interesting to see the effects of minimum wage increases on the average yearly income for employees in the area for that reason.

Re: Job loss predictions over rising minimum wages haven't come true

#73

Post by alasdair_ »

dv_dt wrote: post #23
Pigo wrote: post #8

Earlier quoted context omitted.

I've read reports of Target, and similar companies, cutting back hours of many employees. I take such reports as anecdotal, but I didn't catch them talking about this in the article at all.

I think the unethical part we get into with Target/Walmart/et al is the staffing of multiple shifts of part time work when it's obvious by the numbers that they're avoiding paying benefits for the hiring of fewer full time workers. The systemic question here is if we should allow it to be a financial advantage for companies to do that - especially large profitable ones with a footprint all over our nation.

>The systemic question here is if we should allow it to be a financial advantage for companies to do that - especially large profitable ones with a footprint all over our nation.

The tying of health insurance to employment is the core issue. We give massive tax breaks to corporations via tax-deductible health insurance which naturally favors those employers with larger labor pools (who can therefore negotiate the best discounts).

We need to move to medicare for all and then treat health insurance over and above that like any other taxable benefit provided by an employer.

Re: Job loss predictions over rising minimum wages haven't come true

#74

Post by pg_bot »

Lavery wrote: post #61
pg_bot wrote: post #56

You might not lose your job, but you may see your hours reduced or you might not get the opportunity in the first place. Technically the employment numbers don't change, but you shouldn't think of of minimum wage employees like salaried employees. Minimum wage earners can lose fractional percentages of their jobs unlike salaried employees. Most proponents of raising the minimum wage cite the Card & Krueger paper whic…

The countries you cite are able to have a minimum wage of zero because it's coupled with a robust social safety net (sometimes along with other backstops--Norway, for instance, is heavily unionized). This pairing is important, and is absent in the US.

There are about 40 countries without a minimum wage. I cherry picked countries that most people on HN would recognize since I'm assuming people would not know much about the economies of Tuvalu, Tonga, or Rwanda.

Re: Job loss predictions over rising minimum wages haven't come true

#75

Post by learc83 »

noja wrote: post #55
JMTQp8lwXL wrote: post #32

Earlier quoted context omitted.

We inflation-adjust social security benefits annually, we could also do the same for minimum wage.

Would that defeat the point of inflation?

No because 1. It only impacts a small percentage of workers. 2. It's a wealth transfer--money isn't created to pay it.

Re: Job loss predictions over rising minimum wages haven't come true

#76

Post by boomboomsubban »

sobhaobnONJ wrote: post #57
mullingitover wrote: post #9

Minimum wage isn't just flat for a decade, it's not being adjusted for inflation. This means minimum wage workers have been getting a pay cut over time. The debate isn't just whether we should raise minimum wage, it's whether we should be cutting it. By allowing it to remain stagnant we're making the default decision to cut.

I don't understand why this isn't a red herring. Minimum wage may be remaining stagnant but total employee compensation has been rising steadily, it's just that most of that compensation is in the form of spending on employee benefits like insurance. If people quit expecting employers to provide them with anything except for cold hard cash then you'd likely see wages increasing with time. To expand a bit more on this…

>This creates a scenario where a dollar into the insurance budget yields more than a dollar worth of value

Using this same logic, a better use of that dollar would be spending it on taxes as the even larger government can negotiate even better rates with healthcare providers, providing even more value to the employee.

Instead, the company fights to keep that dollar so they can spend it as they see fit, and the employee wants that dollar so they can use it as they want to.

Re: Job loss predictions over rising minimum wages haven't come true

#78

Post by wffurr »

noja wrote: post #55
JMTQp8lwXL wrote: post #32

Earlier quoted context omitted.

We inflation-adjust social security benefits annually, we could also do the same for minimum wage.

Would that defeat the point of inflation?

No, prices could still go down in real terms by remaining constant. The same for above minimum wage rates.

But by continually raising the floor, we make sure it doesn't get too far below the median or mean. That should be in everyone's best interest, both in terms of keeping the economy going by consumer spending and in terms of fairness and not having a desperately poor underclass.

Re: Job loss predictions over rising minimum wages haven't come true

#79

Post by FabHK »

d357r0y3r wrote: post #70
FabHK wrote: post #34

Earlier quoted context omitted.

No, it's not a straw man. Austerity has very much been promoted as a cure; it was not an inevitable consequence of the economic situation. The debate is maybe best exemplified by the debate between Krugman ("against austerity") and Reinhart/Rogoff ("pro austerity"). > Nobel laureate Paul Krugman refused to back down in a dispute with Harvard University economists Carmen Reinhart and Kenneth Rogoff over a 2010 paper t…

Krugman doesn't believe that there's any problem with unlimited debt, so of course, he's not going to want austerity. Why would you make sacrifices when you get everything you want, today, for free? There are consequences for overspending and overborrowing. We don't have a way to paper over that. You can pay today or you can tomorrow with interest.

You're caricaturing Krugman's view. First, he doesn't advocate for "unlimited debt" or think that there is no problem with it. He says that with the current interest rates, for many countries it would be better to take on additional debt than to engage in austerity, both in the short and in the long term. Second, he argues that the Kenneth/Rogoff paper showing some sudden onset of bad consequences at some magic level of debt/GDP is mistaken and misguided.

> You can pay today or you can tomorrow with interest.

Yes, that's how it works with individuals or households. For countries, it's a bit more complicated than that.

Finally, note that Trump's uncalled for tax cut has significantly increased US debt for basically no benefit (except enriching corporations and the very rich), while those arguing against austerity would want to incur some debt for productive purposes, enhancing growth down the line.

Re: Job loss predictions over rising minimum wages haven't come true

#80

Post by akvadrako »

Lavery wrote: post #61
pg_bot wrote: post #56

You might not lose your job, but you may see your hours reduced or you might not get the opportunity in the first place. Technically the employment numbers don't change, but you shouldn't think of of minimum wage employees like salaried employees. Minimum wage earners can lose fractional percentages of their jobs unlike salaried employees. Most proponents of raising the minimum wage cite the Card & Krueger paper whic…

The countries you cite are able to have a minimum wage of zero because it's coupled with a robust social safety net (sometimes along with other backstops--Norway, for instance, is heavily unionized). This pairing is important, and is absent in the US.

They are unrelated; countries need a social safety net regardless of what the minimum wage is.

You might even argue that the higher you make min wage, the more important social services are, because you have taken away the ability of low-skilled workers to support themselves.

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