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

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

commondreams.org

Post reply on HN
Print view View original

161–170 of 451 posts

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

#161

Post by chillacy »

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.

These companies are b2b and provide value to other businesses who would rather not become experts in say, how to manage cleaning staff, and rather focus on building widgets.

In that regard the sales pitch is similar to how Microsoft can sell a company email and word processing so that the company doesn't have to figure out how to write business software.

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

#162

Post by Daishiman »

friedman23 wrote: post #146
martin_bech wrote: post #140

Earlier quoted context omitted.

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..

Scandinavia isn't a country

We are all aware of that. Doesn't change that their policies are extremely similar by all accounts.

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

#163

Post by monocasa »

bhupy wrote: post #52
jfengel wrote: post #42

Earlier quoted context omitted.

There isn't a causal link. That's why we have minimum wage laws. The idea is that rather than paying people what we can get away with, we pay them what they are worth to us. If productivity improves, but wages are indexed only to inflation, then the rich get richer and the poor at best stay the same. They produce more but don't see their lives get better. In a country that has produced so much additional wealth, it w…

Well, while it's important that the minimum wage is $24/hr (or $15/hr), none of these results tell us whether the better way to do that is to mandate that employers pay that full wage, or for the government to fill in the blanks with a UBI/NIT funded by progressive taxation.

If productivity is going up, why would we subsidizing their employers by paying part of their wage?

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

#164

Post by chrisseaton »

credit_guy wrote: post #160
chrisseaton wrote: post #125

Earlier quoted context omitted.

> 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.

That's for sure. This is an article that makes an appeal to fairness though. The underlying message is "the rich are getting richer, and the poor are getting poorer". So, if you want to follow the argument of fairness, should the wage of the minimum wage workers grow at the same rate as the average productivity for the nation, or as the rate of the productivity gains for the minimum wage workers? If it's the latter,…

> This is an article that makes an appeal to fairness though.

Right... but there's absolutely no mechanism to achieve anything apart from through the market (for the private sector.) You can argue all you want, but nothing will happen. Nobody (to an approximation) is going to voluntarily pay more for an abstract concept of fairness.

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

#165

Post by phamilton »

Sohcahtoa82 wrote: post #101
norseboar wrote: post #95

I think there's a bad assumption in here, which is that pay should keep pace with productivity gains in the first place. I'd argue the whole point of productivity gains is that they do outpace pay. The idea is the same work generates more value. Some of that extra value can be passed back to the employee, but if all of it is passed back to the employee, then the goods produced don't actually get cheaper. If nothing g…

This flies in the face of so many HN readers that claim that salaries are based on the value created by the employee.

Value created is the ceiling, the floor is min(cost of employee's alternative, cost of employer's alternative).

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

#166

Post by credit_guy »

bleepblorp wrote: post #127
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.

That was exactly my thinking. So the argument is that the minimum wage should keep pace with the cost of living. We, as a society, need to help those who were less fortunate than us, and it make sense to make an appeal to compassion.

This article is trying to argue something else entirely. That we as a society are collectively screwing those less fortunate. The productivity has gone up, and the gains from the productivity go to the rich rather than the poor. While this might be true in principle, this article fails to provide the evidence, as the entire premise is flawed.

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

#167

Post by curtis3389 »

friedman23 wrote: post #146
martin_bech wrote: post #140

Earlier quoted context omitted.

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..

Scandinavia isn't a country

Perhaps they mean Denmark+Norway+Sweden collectively?

https://en.wikipedia.org/wiki/Scandinavia#Use_of_Nordic_coun...

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

#168

Post by FartyMcFarter »

arcticbull wrote: post #138
charlesu wrote: post #120

Earlier quoted context omitted.

Wages have little to do with productivity and everything to do with bargaining power. CEOs are paid well because we expect them to be and they can demand it, irrespective of their actual contributions to the success of the company. But for some reason only the worker must justify his pay.

CEOs are broadly speaking benchmarked on return on equity for investors. They receive high salaries in anticipation of their doing a good job, and if they don't they're removed. Further, a disproportionate amount of their compensation is equity based to align their incentives. I'm not saying it's right or wrong, just that they are expected to justify their pay too.

> They receive high salaries in anticipation of their doing a good job, and if they don't they're removed.

When they get removed, they often receive golden parachutes even if they seriously effed up the company.

This can't be explained by return on equity. I guess it can be explained by bargaining power or cronyism, or perhaps other things I'm not thinking of.

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

#169

Post by Vvector »

pessimizer wrote: post #128
dantheman wrote: post #87

Earlier quoted context omitted.

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.

It's also not difficult to sue a company for unfair hiring/firing practices.

But if the employee is via third party, there is no hiring or firing involved, limiting the liability of the first company.

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

#170

Post by root_axis »

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.

In which developed economy is it easier to fire employees than in the U.S?
Post reply on HN