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If pay had kept pace with productivity gains, minimum wage would be $24 an hour

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Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#201

Post by missedthecue »

cryptoz wrote: post #195
missedthecue wrote: post #191

Earlier quoted context omitted.

Wages have not stagnated. Disposable income adjusted for inflation is up enormously since 1968, while at the same time, the average number of working hours per year is at an all time low. This is according to data collected by the federal reserve. https://fred.stlouisfed.org/graph/fredgraph.png?g=rKwm

Wages have stagnated. Your graphs aren't really relevant to this question; so what if per capita disposable income has increased? That doesn't say anything at all about wages of people in America. Here is a more complete picture, with words and discussion and multiple graphs too: https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us...

My graph also shows median income, and it clearly shows it has not stagnated, but risen, and not by any small amount.

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#202

Post by missedthecue »

SketchySeaBeast wrote: post #197
missedthecue wrote: post #191

Earlier quoted context omitted.

Wages have not stagnated. Disposable income adjusted for inflation is up enormously since 1968, while at the same time, the average number of working hours per year is at an all time low. This is according to data collected by the federal reserve. https://fred.stlouisfed.org/graph/fredgraph.png?g=rKwm

The graph is truly awful for showing hours worked. Also, what's that gigantic leap in disposable income? Are we to believe that on average American's have $50,000 worth of disposable income when they didn't before? I think that relies heavily on which version of average is being discussed.

the spike in the last year is an glitch in their display software, but it doesn't change the central point of what's being shown here. What version of average do you think is appropriate?

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#203

Post by chordalkeyboard »

ahoy wrote: post #58
NovemberWhiskey wrote: post #6

Is there any evidence that whole-workforce productivity applies equally to minimum wage jobs? If not, the claim seems unsustainable. Completely anecdotally, improvements in labor productivity due to automation (etc) are less likely to be impactful in jobs like waiting tables, delivering newspapers or flipping hamburgers. That anecdotal evidence is backed by research that shows that service sector productivity tends t…

There's no reason that we couldn't allow workers to be the beneficiaries of automation.

Indeed they are, through the greater quality and variety of products available.

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#204

Post by BurningFrog »

missedthecue wrote: post #179

And if they had kept up since 1949, minimum wage would be $4.22 an hour. Two can play the game of cherrypicking troughs and peaks. Additionally, average productivity is not minimum wage productivity. They are separate statistics, and the bulk of the efficiency gains have not been made at the burger flipper level, but at higher levels, where there have been huge gains in pay. The productivity gains in engineering and…

A simple thing to remember is that any minimum wage stat that takes 1968 as the base year is deliberately misleading.

It was the first thing I thought when opening this, and as so often, it was the case.

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#205

Post by chordalkeyboard »

lilactown wrote: post #60
qeternity wrote: post #49

This is so horribly flawed. Productivity improvements have been concentrated at the high end, and those that have occurred in low skilled jobs have been almost entirely due to technology, not to labor efficiency. Technology gains have always disproportionately been captured by the providers of capital over the providers of labor (given they are the ones who invest in said technology).

What value does technology provide other than increasing labor efficiency? If tech helps me build 10x the number of widgets, should all of that surplus value only be captured by the technology owners? What about the people who build and service the technology which allows these improvements to be implemented?

> should all of that surplus value only be captured by the technology owners?

No, and neither is that the case. The increased profit is the wage the technology earns for the investor who wisely chose to make a successful investment. Other investors made different, less wise automation decisions and in so doing, earned less (or negative) profit.

The remainder of the surplus value is captured by the consumer who now has available to him or her a greater variety of higher quality products at lower prices. They capture this value when they go to market and get more better and newer things.

> What about the people who build and service the technology which allows these improvements to be implemented?

They are typically more skilled workers who get paid more because they are performing a higher skilled job. The old way of doing things was less productive and required less skill from the workers. The new way is more productive and requires greater investments in capital and skilled labor.

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#206

Post by SketchySeaBeast »

missedthecue wrote: post #202
SketchySeaBeast wrote: post #197

Earlier quoted context omitted.

The graph is truly awful for showing hours worked. Also, what's that gigantic leap in disposable income? Are we to believe that on average American's have $50,000 worth of disposable income when they didn't before? I think that relies heavily on which version of average is being discussed.

the spike in the last year is an glitch in their display software, but it doesn't change the central point of what's being shown here. What version of average do you think is appropriate?

https://fred.stlouisfed.org/series/A229RX0

Even here there is a definitive and deliberate bump right during the beginning of the COVID times. I don't believe that's an artifact. Somehow this analysis is saying people are vastly better in August than they were in February.

I think that "average" in most of the different versions is useless. The millionaire and billionaire classes can be so over-represented they can draw the rest up. It doesn't answer if all of society is actually becoming more well off or just the cream continuing to rise.

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#207

Post by mortenjorck »

martin_bech wrote: post #140
rmason wrote: post #116

Earlier quoted context omitted.

All these comparisons miss one thing: after WWII America had a monopoly. We had destroyed our competitors factories in Asia as well as in Europe. It took a while for them to build back and be truly competitive outside their home countries. Here in Michigan we had a front row seat to this happening with manufacturing. Everything peaked in 1973 and has been on a slow decline ever since. Sure there have been booms but t…

Hi from Scandinavia, we dont have a monopoly on anything, and no actual minimum wage, yet people make about $20+ at the lowest paying jobs, enjoy 5 weeks paid vacation, free healthcare and cheap childcare..

The wild thing is that even if you were to apply Scandinavia's highest tax bracket of 57% to this (which someone in the lowest tax bracket would never pay), you'd still come out above the US national minimum wage, out of which one is also expected to pay for healthcare and budget for unpaid time off.

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#208

Post by cryptoz »

missedthecue wrote: post #201
cryptoz wrote: post #195

Earlier quoted context omitted.

Wages have stagnated. Your graphs aren't really relevant to this question; so what if per capita disposable income has increased? That doesn't say anything at all about wages of people in America. Here is a more complete picture, with words and discussion and multiple graphs too: https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us...

My graph also shows median income, and it clearly shows it has not stagnated, but risen, and not by any small amount.

Median income has nothing to do with real wage stagnation.

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#209

Post by dpix »

comeonseriously wrote: post #33
dpix wrote: post #21

Earlier quoted context omitted.

As much as it costs for employees to be paid sufficiently. It seems awfully dangerous to think that we should pay people less because otherwise things would be expensive. This is exactly why/how wealth is moving up and up to a smaller proportion of people at the top

> It seems awfully dangerous to think that we should pay people less because otherwise things would be expensive. You're assuming that's why I was asking.

Am I agreeing with you then? You didn't make your position very clear. I'm just stating what I think about wage inequality and class gaps.

If you're asking for an actual number of the price of a Cheeseburger and a Shake? I don't know, but it may be a number that's ultimately better for society?

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#210

Post by CyberRabbi »

vsareto wrote: post #39
CyberRabbi wrote: post #24

Maybe I’m wrong but what is the causal link between productivity and wages, especially minimum wage? I always thought that cost of living dictated wages and the so-called wage stagnation was due to relative lack of inflation for basic living expenses over the past 20 years. Also the past 20 years have seen a relative large influx of immigration compared to the previous 20 years. Increasing the competition between wor…

I don't think there is. This is mostly political in that businesses ought to be keeping up wages because that's the right thing to do. If the supply of labor is such that they always have access to lower-paid workers though, there's no real obligation to increase pay. This is when minimum wage should come in, and this would be an argument for increasing minimum wage to that end, but businesses themselves can just ign…

I don’t see how increasing wages with productivity is the “right thing to do.” Workers have never been paid for the value of what they produced, they have always been paid for the value of their skills. Too far of a deviation from this basic model will likely have disastrous unintended effects.

If they are being paid enough to live I don’t see anything malicious. If people want a higher paying job, they should learn a more coveted skill.

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