How Does A Big Minimum Wage Hike Help?

David Sklansky · #1 11-20-2006, 06:21 PM

I don't want to make a Glenn Beck type mistake here and I am actually scared I might be because my conclusion seems so obvious. Yet many disagree. But I just don't see how a significant hike in the minimum wage helps those who are presently making that wage. As long as there are unemployed people standing by. Some of those people are smarter, more competant and more industrious than those presently making minimum wage. And if it is hiked they will now compete for, and get, jobs that weren't previously on their radar screen.

WillMagic · #2 11-20-2006, 06:35 PM

Post this in politics and you'll get tons of responses.

But yeah, the minimum wage is about as counterproductive a policy as there is.

TomCollins · #3 11-20-2006, 06:43 PM

[ QUOTE ]
I don't want to make a Glenn Beck type mistake here and I am actually scared I might be because my conclusion seems so obvious. Yet many disagree. But I just don't see how a significant hike in the minimum wage helps those who are presently making that wage. As long as there are unemployed people standing by. Some of those people are smarter, more competant and more industrious than those presently making minimum wage. And if it is hiked they will now compete for, and get, jobs that weren't previously on their radar screen.

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Just to clarify, you are talking about people who choose not to work now for various reasons, but would work if they could make more money?

If so, you are correct and understand a basic supply/demand curve. Unfortunately, that alone puts you in about the top 5% of all people in terms of understanding economics and makes you inelgible to ever become elected to office.

SNOWBALL · #4 11-20-2006, 07:02 PM

what % of jobs that pay minimum wage require any type of talent whatsoever?

Carded · #5 11-20-2006, 07:07 PM

I don’t disagree with the OP’s point in the short term.

In the long term
For those that kept their jobs and receive the benefit of the pay increase. The benefits of the increased wages will be passing. In my mind, salaries are a function of minimum wave and would increasing accordingly in time. Inflation would result devaluing bankrolls.

Aleo · #6 11-20-2006, 07:09 PM

Because there are many career minimum wage earners who are in little danger of losing their jobs and who will be happy to get the raise. Yes there are plenty of career minimum wage earners. I'm very surprised that you can think added job competition can hurt minimum wage earners that much.

Your question says

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Some of those people are smarter...

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SOME, not all. This is to say that many unemployed people are unemployed precisely because their abilities are less competitive. Also, many currently employed are comparably or even smarter/industrious than the competitive unemployed. It is their weaker co-workers who will have something to fear, and I'd argue that this is a small group of the overall minimum wage earners.

Regards
Brad S

TomCollins · #7 11-20-2006, 07:16 PM

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what % of jobs that pay minimum wage require any type of talent whatsoever?

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Can't certain people be more efficient at minimum wage jobs, even if they are not required? If I have a cashier who can do 100 transactions an hour vs. one that can only do 50, it's pretty clear which one I want.

Aleo · #8 11-20-2006, 07:18 PM

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what % of jobs that pay minimum wage require any type of talent whatsoever?

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Pretty much all of them.

Sure, they don't require special training or skills. But many of them are hard work and a willingness/ability to work hard will always be an advantage.

If you don't define work ethic as talent, fine, but the point is the same.

Aleo · #9 11-20-2006, 07:25 PM

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In my mind, salaries are a function of minimum wave and would increasing accordingly in time. Inflation would result devaluing bankrolls.

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Sure, but it is important to bear in mind that the reverse is also true. The two will always respond to one another in reaction to inequity or need. Why should the minimum wage earners accept the low end of things?

Stu Pidasso · #10 11-20-2006, 07:55 PM

The United States essentially has full employment. Very few actually earn minimum wage. However of the few, many of them are not smart enough or industrious enough to bargin for a wage increase or find a job that pays more. These people, who are 100% competent in thier minimum wage jobs, would benefit from a minimum wage increase.

Yes David there are such people. Example, there is a girl who works for a contractor my company uses. Her employer pays her the state minimum wage. She is just as qualified as the hundreds of people we have hired over the last 3 years. All she would have to do to get a job is put in an online application. She doesn't have a computer so I suggested she go to the library. Every couple of months or so I ask her if shes put in her application in yet and she always replys "I haven't got around to it". To put this in perspective, she could go from making state minimum wage with no benefits to $64000/yr with excellent medical, and dental.

Stu