Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Minimum wage would be $26 an hour if it had grown in line with productivity

cbsnews.com

Post reply on HN
Print view View original

101–110 of 199 posts

Re: Minimum wage would be $26 an hour if it had grown in line with productivity

#101

Post by drran »

ranma4703 wrote: post #6
credit_guy wrote: post #2

No it would not. The average productivity of a US worker might have increased by a certain amount, but not the productivity of the minimum wage earners. If their productivity had gone up that much, there would be no need for a minimum wage law, the employers would simply be glad to pay them based on their productivity.

Do you think that companies pay based on productivity, or based on the minimum amount they need to pay in order to attract workers? If the former, do you believe that if a remote worker moves from NYC to Idaho, and their employer cuts their pay by 25%, it is because their productivity has dropped by 25%? Or because their employer knows they can get away with paying them less in an area with lower cost of living / les…

Yep, their OVERALL productivity, as part of the system, has dropped by 25%. Isn't that obvious? They are not spherical workers in vacuum, they are part of economic system. If you open a store in the middle of a desert, your overall productivity will be zero, regardless of your productivity in the store, because no buyers, no roads, no police, no electricity, no water, etc.

Re: Minimum wage would be $26 an hour if it had grown in line with productivity

#102

Post by anchpop »

MisterBastahrd wrote: post #52
agitator wrote: post #44

I'm struggling to understand how productivity has anything to do with salary. Productivity increases are inevitable for everything as automation keeps improving. Salaries go up with demand for skills. If its more difficult to hire for a critical role (a skilled job or competitive), or the role generates a lot of value for a company, salaries go up. Simple economics. Low skill jobs and physical labor jobs actually req…

In the 1930s, a store clerk in a large city could afford to support a family in a home they would eventually own on their single income. Today, a couple with that same job would likely be in public housing and would be scraping by.

To the extent that that's true, it's in large part because their income is now absorbed by land rents, which were much lower in the 30s. There's an obvious contradiction in the american dream: home ownership is the goal, so homes should be a good investment. If homes are a good investment, that means the price of homes goes up. If the price of homes goes up, they get less affordable for everyone who doesn't already have one. Look at what happens when you don't institute regulation designed to guarantee that homes continue to be a depreciating asset: https://pbs.twimg.com/media/E9V_0VBWEAE1ixe?format=jpg&name=...

Re: Minimum wage would be $26 an hour if it had grown in line with productivity

#103

Post by jrsj »

orangeoxidation wrote: post #71
lostapathy wrote: post #46

Earlier quoted context omitted.

Right, this is where this sort of blanket extrapolation breaks down. Has the average productivity grown that much? Sure, I can believe that. Has the productivity at the lower margin grown that much? I seriously doubt that. The value created by stocking shelves at wal-mart just doesn't really change over time. There's a lot of labor on the lower end that is a solved problem with all the productivity wrung out of it de…

> Has the productivity at the lower margin grown that much? I seriously doubt that. That's the problem. The minimum wage is a legal instrument, not just an economic process. It is designed for the lower margin to be "overpaid" over what they could get from the market otherwise. It basically says "everyone working should get at least this much of our collective production". This is what we have decided our society sho…

We’ve also completely failed to provide adequate opportunities for these workers to gain the skills and education to be able to do something more valuable with their time. That’s a problem the minimum wage can’t solve. There’s a threshold where people will just become unemployable under that model without more investment in them.

Re: Minimum wage would be $26 an hour if it had grown in line with productivity

#104

Post by tick_tock_tick »

lmilcin wrote: post #59

I agree that minimum wages are too low but the argument that wages should track productivity is false from economical point of view, in my opinion. The argument would be true if how people contribute to economy did not change. But over time disparity in contribution to economy changed. Hundred years ago people had very similar jobs, mostly physical, manual, where each would contribute rather similarly. Nowadays compa…

I honestly think a minimum wage is one of the worst way's to guarantee a minimum quality of life. It keeps all the downside of an employer focused system and keeps adding more and more of the governments job onto corporations. Huge parts of this mess are from government intervention in the employee/employer relationship (healthcare being taken care of by your employer was to circumvent wage freezes by Congress during WW2).

We are already seeing good results from the expanded child tax credit distributed over time instead of lump summed. I'd like to see that expanded as a negative income tax credit over the full 12 months of the year. It doesn't have to be a ton of money either if the guaranteed floor is half of what's need to live it would force a lot of employers to clean up their act.

One other idea I'd like to pitch is a say every 5 year moving tax credit. Something like if you move >100 miles you can claim a $5k tax credit. The main goal would be to get people out of the rut where they are too poor to move but the area they live in is too expensive to stay.

Re: Minimum wage would be $26 an hour if it had grown in line with productivity

#105

Post by sophacles »

fred_is_fred wrote: post #82
tuatoru wrote: post #73

Earlier quoted context omitted.

This is the lump of labour fallacy. Edit: in the form, the set of jobs we have right now is fixed and will be the same for all time. The flow of money is circular. If lower-paid people had more disposable income, they would spend more on things that employ other people. Services like restaurants or haircuts or yoga classes or personal trainers or personal shoppers or life coaches, the last three of which are pretty n…

If lower-paid people had more income they would be paying down debt, buying a better used car, paying for daycare, and maybe going on a trip or to. Personal shoppers and life coaches I think kick in a lot higher than you do.

At first they would pay down debt, and buy a car that actually works, and other stuff that should have always just been available to them. Once that debt is paid off, and the car is not a constant source of worry - they have money to do those other things. For example going on a trip is the same type of "luxury" as shoppers, life coaches, etc - its spending money on something other survival.

Re: Minimum wage would be $26 an hour if it had grown in line with productivity

#106

Post by mytailorisrich »

drran wrote: post #101
ranma4703 wrote: post #6

Earlier quoted context omitted.

Do you think that companies pay based on productivity, or based on the minimum amount they need to pay in order to attract workers? If the former, do you believe that if a remote worker moves from NYC to Idaho, and their employer cuts their pay by 25%, it is because their productivity has dropped by 25%? Or because their employer knows they can get away with paying them less in an area with lower cost of living / les…

Yep, their OVERALL productivity, as part of the system, has dropped by 25%. Isn't that obvious? They are not spherical workers in vacuum, they are part of economic system. If you open a store in the middle of a desert, your overall productivity will be zero, regardless of your productivity in the store, because no buyers, no roads, no police, no electricity, no water, etc.

The productivity of a remote worker does not depend on their location, obviously.

If you WFH in NYC then move to Idaho while still working the same job then your productivity has not moved at all. If the employer tries to lower the salary it is simply because they think they can.

Re: Minimum wage would be $26 an hour if it had grown in line with productivity

#107

Post by tick_tock_tick »

jrsj wrote: post #39

This might be the case but many jobs I feel like would no longer be worth paying anyone to do at that rate. That would suggest to me that the productivity of minimum/low wage workers has not increased at the same rate as productivity generally. Which would make sense given most of that increase is attributable to technology which isn’t distributed evenly through different sectors of the economy etc.

The basic example is a janitor in the early 1900s is only marginally less productive then a current day one while an accountant from the same time is an order of magnitude more productive now (excel/etc).

Re: Minimum wage would be $26 an hour if it had grown in line with productivity

#108

Post by frankbreetz »

By this same metric the median household wage would be 140k The chart says production per worker has doubled.

Average household income 1970:10k[0] Inflation adjusted: 70k[1]

[1]https://www.census.gov/library/publications/1971/demo/p60-78...

[0]https://www.usinflationcalculator.com/

Re: Minimum wage would be $26 an hour if it had grown in line with productivity

#109

Post by QuarterReptile »

lmilcin wrote: post #93
drran wrote: post #86

Earlier quoted context omitted.

What stopping you from paying much more to these poor workers?

What is stopping companies is competition. If you own a supermarket and want to pay a decent wage, bad news for you. Over long time you are likely to loose against your competitor who doesn't share your sentiment. You may start with 100 companies of which 2 don't have any scruples and over time you will find out that these companies will take over the market along with other ones that will use this experience as lear…

>If you own a supermarket and want to pay a decent wage, bad news for you. Over long time you are likely to loose against your competitor who doesn't share your sentiment.

If you can market this "decent wage" to your customers successfully enough that they buy in, then you can continue along this trajectory. (As a side note, most people here probably wouldn't take you up on that "decent wage" retail job, in part because they don't consider the wages very impressive. On the other hand, people who work at the "unscrupulous" grocery stores have agreed to those wages. So "decent" might have a sliding scale.)

Re: Minimum wage would be $26 an hour if it had grown in line with productivity

#110

Post by exabrial »

Minimum wages were designed to protect workers live's from being wholesale sacrificed in factories. The theory of a government mandated "livable wage" is a concept from 3rd wave Socialism.

It is truly the worst possible way to guarantee quality of life as it gives employers an excuse to be "legal" while being horribly out of line ethically.

Post reply on HN