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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

#121

Post by pydry »

codekansas wrote: post #117
pydry wrote: post #84

Earlier quoted context omitted.

If efficiency has gone up why hasnt rent gone down? Since rent has been pushed up by political means why not wages? Also, why are we assuming that technology brought down wages when offshoring has skyrocketed. What makes you think it wasn't competition from the third world labor rather than robots? There is a political position embedded in the assumption that robots are responsible for the missing jobs.

I would guess this speaks more to political mismanagement than an intentional goal. No politician is going to get elected on a platform of higher rents and lower wages. Increased rents, at least, are usually caused more by good intentions gone bad than by intentional malice

>No politician is going to get elected on a platform of higher rents and lower wages

Have you noticed how little the media focuses on the actual platforms of most politicians and focuses on the spectacle and drama of politics instead? That distraction serve a purpose (for the owners of said media).

Also, a platform of higher rents and lower wages will usually be called "lower taxes" and "freedom from onerous regulations". If you want to see more of this type of propaganda, look at https://www.aei.org/ for instance.

This type of thing falls apart when analyzed too closely, which is partly why the media will use it to drive soundbites but won't dive in too deep.

Politicians get elected on a platform of higher rents and lower wages because the donations they rely upon come from people who want it and the media coverage they rely upon come from people who want it.

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

#122

Post by credit_guy »

In a very simplistic way, shouldn't the average wage keep pace with the average productivity gains and the minimum wage keep pace with the minimum productivity gains? I can see the average farmer making huge productivity strides, since they use much more complex combines, and irrigation systems and such, but did the productivity of a burger flipper go up similarly?

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

#123

Post by dredmorbius »

deegles wrote: post #20
ardy42 wrote: post #3

Earlier quoted context omitted.

That doesn't contradict the actual article, whose full title is: > If Worker Pay Had Kept Pace With Productivity Gains Since 1968, Today's Minimum Wage Would Be $24 an Hour It looks like when it was shortened one of its most important words were dropped.

Sorry, I was trying to make it fit the character limit :(

Title-smithing is an art. Email the mods if you're stuck; hn@ycombinator.com

(I have, with some shorter suggestions.)

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

#124

Post by oramit »

michaelbuckbee wrote: post #40

There's a lot of reasons for this but one of the largest is the near invisible (to me) structural shift from direct hire to contractors for jobs at the lower end of the wage/salary spectrum. There is a fantastic long form article that articulates this better than I can at: https://highline.huffingtonpost.com/articles/en/poor-millenn... The portion relevant to this discussion: "Thirty years ago, she says, you could wa…

I agree, this is one of those slow moving trends that you just don't see but has really large effects after decades of compounding. It used to be normal for companies to have much larger work forces and to in-source all tasks, even if they were not a core competency. Now the emphasis is on lean everything, to only focus on your niche, and outsource as much as possible. Remember IT departments? It's all been outsourced to the Cloud.

I have two theories on this. One is that we simply have improved our management processes. The economy became more developed and you could realize real efficiency gains from outsourcing. From a pure GDP perspective - this was good.

The second is more messy and i'm still working on it but it ties into a lot of macro issues. It used to be much easier start out with no experience, say as a janitor, and work your way up to a higher position in the same company. This was possible because it was all the same company. Now with outsourcing this is impossible, if you start as a janitor, the only thing you can do is maybe run the janitor company, but you won't ever become the CEO of the company whose office you clean. At the same time, you've made entry-level positions at the company harder to attain. The floor is no longer janitor, it is now junior developer (to take a software example). This is one of the reasons why I think there is such a bifurcation in our labor market. A college degree is now the minimum requirement to get your foot into the door. Again, it used to possible to start at the very bottom and work your way up but now there is a hard cap on growth unless you go the college route.

I think this was a clever way for companies to also push costs onto employees. Training used to be a thing companies did but now it's basically been abandoned. Go spend your own money and get a degree before even talking to us is the attitude.

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

#125

Post by chrisseaton »

credit_guy wrote: post #122

In a very simplistic way, shouldn't the average wage keep pace with the average productivity gains and the minimum wage keep pace with the minimum productivity gains? I can see the average farmer making huge productivity strides, since they use much more complex combines, and irrigation systems and such, but did the productivity of a burger flipper go up similarly?

> In a very simplistic way, shouldn't the average wage keep pace with the average productivity gains and the minimum wage keep pace with the minimum productivity gains?

Wages are set by the market, not by productivity.

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

#126

Post by bhupy »

ptmcc wrote: post #65
rayiner wrote: post #57

These sorts of comparisons are extremely difficult to make. They depend very strongly on what exactly you’re looking at, how you’re measuring inflation, etc. You can easily make charts that show total worker compensation is closely tracking productivity growth: https://www.americanactionforum.org/research/does-compensati... (Unlike Common Dreams, this article shows their work and discloses their exact methodology and…

Many (most) minimum wage jobs do not provide any meaningful benefits, so it's tangential to the minimum wage in most cases. There's no doubt some fuzzy math involved to extrapolate inflation over the course of 50+ years, but I don't think that invalidates the fact that minimum wage has objectively not kept up with inflation even remotely. The federal minimum wage has been stuck at $7.25 since 2009, and a handful of s…

> The federal minimum wage has been stuck at $7.25 since 2009, and a handful of states are only just now breaching $15/hr. At this rate by the time a federal increase happens we'll already be another 20 years behind.

But even more localities have higher minimum wages. Because the "minimum necessary" is extremely cost-of-living specific, it's decentralized.

Despite Washington having a State minimum wage of $13.50, Seattle's minimum wage is $16.39/hr.

Despite New York having a State minimum wage of $11.80, New York City's minimum wage is $15/hr

Despite Illinois having a State minimum wage of $11, Chicago's minimum wage is $14/hr.

Despite California having a State minimum wage of $13, San Francisco and Berkeley's minimum wages are $16.07/hr. Emeryville's minimum wage is $16.84/hr. San Jose, Santa Clara, Cupertino, Sunnyvale, Fremont, Belmont, Alameda, El Cerrito, Los Altos, Milpitas, Redwood City, Palo Alto, Richmond, Malibu, Los Angeles, Santa Monica, and Santa Rosa all have minimum wages at or higher than $15/hr.

You can view it by state and by city here -> https://www.epi.org/minimum-wage-tracker/

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

#127

Post by bleepblorp »

credit_guy wrote: post #122

In a very simplistic way, shouldn't the average wage keep pace with the average productivity gains and the minimum wage keep pace with the minimum productivity gains? I can see the average farmer making huge productivity strides, since they use much more complex combines, and irrigation systems and such, but did the productivity of a burger flipper go up similarly?

Productivity growth at the bottom end is very low, but wages at the bottom end still need to keep up with the cost of living or people who are in minimum wage jobs will no longer earn enough to survive.

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

#128

Post by pessimizer »

dantheman wrote: post #87
michaelbuckbee wrote: post #40

There's a lot of reasons for this but one of the largest is the near invisible (to me) structural shift from direct hire to contractors for jobs at the lower end of the wage/salary spectrum. There is a fantastic long form article that articulates this better than I can at: https://highline.huffingtonpost.com/articles/en/poor-millenn... The portion relevant to this discussion: "Thirty years ago, she says, you could wa…

The question is why these services exist? I don't think it has to do with wages, I think it has to do with the difficulty of firing employees.

It's not difficult to fire employees in the US. You can't just fire the minorities and the women, but other than that you can fire for any reason at any time.

It's sometimes difficult to fire employees as a way of lowering wages. The people left behind who are expected to make up for that through raised workloads and losing the experienced for green new hires might complain.

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

#129

Post by bhupy »

pydry wrote: post #84
rayiner wrote: post #66

Earlier quoted context omitted.

If you replace 1,000 workers with 50 and a very expensive machine, should you pay each worker who remains 20 times as much? Because that’s the assumption in the article. The people who build and service the technology are paid well. They’re techies who live in Silicon Valley, etc. But there are just very few of them compared to the 950 newly obsolete workers.

If efficiency has gone up why hasnt rent gone down? Since rent has been pushed up by political means why not wages? Also, why are we assuming that technology brought down wages when offshoring has skyrocketed. What makes you think it wasn't competition from the third world labor rather than robots? There is a political position embedded in the assumption that robots are responsible for the missing jobs.

> Also, why are we assuming that technology brought down wages when offshoring has skyrocketed. What makes you think it wasn't competition from the third world labor rather than robots?

Do we think that increasing minimum wage will hasten or slow down this trend?

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

#130

Post by SamReidHughes »

pydry wrote: post #121
codekansas wrote: post #117

Earlier quoted context omitted.

I would guess this speaks more to political mismanagement than an intentional goal. No politician is going to get elected on a platform of higher rents and lower wages. Increased rents, at least, are usually caused more by good intentions gone bad than by intentional malice

>No politician is going to get elected on a platform of higher rents and lower wages Have you noticed how little the media focuses on the actual platforms of most politicians and focuses on the spectacle and drama of politics instead? That distraction serve a purpose (for the owners of said media). Also, a platform of higher rents and lower wages will usually be called "lower taxes" and "freedom from onerous regulati…

What.

Lowering taxes doesn't lower wages.

Higher rents are caused by regulations, not freedom from regulations. You have to ask permission for something as simple as building places to live.

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