Friday, July 24, 2009

Some Attack Timing of Minimum Wage Hike - washingtonpost.com

Some Attack Timing of Minimum Wage Hike - washingtonpost.com


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The federal minimum wage went up to $7.25 from $6.55 per hour today.

Oh, give me a break! Is that supposed to be a livable wage? Why can't the federal government take a cue from the states shown in green on the above map? Those are states that have a minimum wage that is higher than the federal minimum wage (www.dol.gov).

Illinois, the state that I live in has a minimum wage of $8.00 per hour and that will increase to $8.25 on July 1, 2010! (source) If you read the article in the shared link, and then look at how several states already have a higher minimum wage (which overrides the federal minimum wage), you'll probably agree that the only thing about the "timing of this wage hike" is that it has taken way too long and is not near enough. But that's just my opinion. What do you think?

~ John

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14 comments:

Yvette Kelly said...

I thought we were struggling in Africa but this?in a first world country?what is this world coming to?

John said...

@Yvette_Kelly, I guess you could think of this as one of America's dirty little secrets!

Poverty is such a big problem in this country, but our leaders choose to squander money on unnecessary wars instead of taking care of it's own.

Allen said...

It was bound to happen. Its timing is off, however. So now the little companies that were struggling will more than likely go out completely now. So now more people are going to be with out work.

themom said...

And those in power in Washington, D.C., believe people can "make it" on minimum wage. If one were lucky to actually work 40 hours a week - this would be a GROSS income of $13,440/year. Less FICA and medicare, down to $12,411.84 - now subtract federal and state taxes...net income is around $11,800. that averages to $983 a month. Not what I would call a livable wage. Ohio luckily, has a higher minimium wage like you = $8/hour.

Argentum Vulgaris said...

Damn, a minimum wage. Down here in Brazil the minimum wage is $232/month (that's about $1.21/hour), yup sure the cost of living down here is cheaper, but it's calculated that $1,000 is the minimum required to live with dignity. That's a hell of a lot of people who are living well below dignity level.

AV

John said...

@Allen, I hope you're wrong. As one of those green states on the map, Illinois has already gone through the wage hike (and still have future hikes already in place).

Of course at first, there were those against wage hikes and used that same reason you mentioned. In all actuality most businesses have and continue to pay more than the minimum wage, especially in my industry.

Business have cut jobs for quite some time now in all states, but for other reasons (like decrease in sales, less demand, people have less money to spend, etc).

You are right though that higher wages will affect employment, but it should balance out with those that do have jobs at minimum wage will now have more money to spend. Of course that does not help the unemployed at all! And for all the people that had to work at lower minimum wages for a long time, well it just pisses them off unless they get a raise too.

Another thing: Sometimes the small, very small businesses just get tired of all the regulation, taxes, etc and get burnt out and close down. Of course, it's always easy to blame that on something like a minimum wage hike. Small business owners also eventually retire and in today's econcomy it is hard to sell a business, so that results in unemployment.

@thmom, thank you so much for that detailed comment, which you know about because you are an accountant. And you are right saying that it is still not a livable wage.

The part you said about "if one were lucky enough to actually work 40 hours a week" is so true. America's largest employer is Walmart and they do not schedule the full time employees to work 40 hours. I know many people, who have worked for them and similar businesses, and they all complain of not getting enough hours.

And for those readers outside the U.S. that don't understand this, it is because we have overtime laws that require employers to pay time and one half (hourly rate x 1.5) on all hours above 40 that are worked in a week. So employers will do everything they can to avoid paying overtime.

John said...

@Argentum Vulgaris, thanks for sharing that. It is such a shame that Brazil has such a small minimum wage. It almost seems inhumane. I'm sure those in the government earn a very comfortable living, huh?!

Argentum Vulgaris said...

John, the annual salary of the president alone would pay the New Zealand prime minister for ten years; and that's not counting his expenses.

AV

Jim said...

Considering that we as a country are still pouring billions into the efforts in Iraq and Afghanistan (as you mentioned to another blogger)it takes a lot of nerve for someone to say anything against AMERICAN WORKERS making a minimum wage for crying out loud.
They probably heard the complaining on right-wing radio shows and then parrot the info. to others and the pro-Republican Washington Post runs with this as a STORY!
Gimme a break... I applaud people making things work for the amount they make in a minimum wage job.
It never ceases to amaze me how callous some people in this land of ours can be.

John said...

@Argentum Vulgaris, OMG! Just what I thought, and simply shameful!

@Jim, I couldn't agree with you more. And if I'm not mistaken Chicago has taken it a step futher requiring an even higher wage, and they call that a "living wage."

Thanks, everyone for great thought provoking comments! I have quite a few international readers, so it really helps them to understand these kinds of issues, when they see our comments. Thanks again!

Beth said...

Tonight my sister and I went out to a very popular restraunt, the first time for me, the 100th for her. She found out it was their last night, the owners wife said business has been slow for over a year now. Right away people want to blame Obama, but this has been an ongoing problem. This is a family business though, so the Minimum wage doesn't really affect them.

I've worked minimal jobs before and have never made minimum wage since High School when I worked at McDonalds.

After a conversation earlier with somebody, I was wondering where else you would get paid minimum wage besides fast food chains. Even when I worked at Walmart Corp, or labor temp jobs, I was paid way over the minimum wage.

You almost wonder if the only ones benefiting from this hike are the HS and College Students. Or does everyones pay-rate go up when min. wage goes up?

John said...

@Beth, hello! You know what, we have had many restaurants close here in the last few years. I think there are just too many places to eat and fewer people eat out.

I think that there are some exemptions to the minimum wage laws that would exclude high school students and businesses with very few employees. I know that's the case here in Illinois.

But you're right the college students and entry level people are the main ones to benefit. Whether or not everyone else gets a raise, when minimum wage goes up is always us to the individual employer.

As you know from previously working at Walmart (I did too in high school & college), you aren't allowed to discuss your wages. As far as I know that is a general rule everywhere. So I would assume that SOME people that already make more than minimum get raises (the hard workers and most liked), while other workers would not get a raise.

Yvette Kelly said...

I subscribed to other comments and really interesting comments so I'm back.I want to give my perspective from a few angles.I am an economics major and it has been proven that having a minimum wage does interfere with the free market mechanism.Provided as proof is the high productivity of the east as in China/India,Malaysia etc... This is all well and good.What the study doesn't highlight is the actual standard of living of these highly productive individuals(very low btw).Yes,the companies are making big bucks which go to some people but the masses,not knowing any better,carry on helping them pocket the bucks.So although I know how this is supposed to work when you take the global economy into account I am more inclined to sympathise with the individuals(call me a socialist).In SA,I started entry level work bout 20 yrs back earning US100(converting US1 to ZAR10) and was able to rent a little apartment and buy food,nothing great but do-able.Now 20 yrs later kids starting entry level work are also starting at USD100 a month.They have to live with their parents,can never leave home,prices have gone up in 20 yrs.So where exactly is the economic agenda that say be productive,the companies do well and will employ more and the wheel turns.What's happened is that the big companies made so much money that they replaced people with machines,so they can have even more money.I could go on and an but my point is YES WE NEED TO HAVE MINIMUM WAGES if for nothing else but to curb the big companies' and investors' greed for more and more money.

John said...

@Yvette_Kelly, thank you so much for your thoughtful insight! I'm glad to know that you subscribe to the comments, as I think that is often the most interesting part of this blog.

And your shared knowledge of economics and the real world are most appreciated. I'm think we can all learn something from your comments! You never know just WHO will read them, so thank you again!

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