Does minimum wage hike cost us jobs?

There is some debate on this. Any real business owners out there? This seems like a serious issue.

 

Not really.

Not many businesses are going to close up shop because they have to pay a few bucks an hour however some may if they are that close to the edge so there will ultimately be more that close then if the minimum wage was not increased.

The bigger problem is the rise in goods and services which companies will now charge to offset the costs. You may make 3 dollars an hour more but your average shopping trip is going to burn through that increase in pay in no time. Your typical 7.00 meal at Mcdonalds will now cost about 10 or 11.

 

Years ago when Oregon raised their minimum wage above everybody else's the McDonald's didn't have prices any higher than elsewhere. They had just as many people working in their stores. The cries of conservatives over minimum wage are born out of ignorance not empirical evidence.

 

That wasn't nationwide.

Big difference.

 

Here is a Pew Research Center chart. Pay particular attention to the price as minimum wage increases but los pay attention to the price when minimum wage stays the same.

Kind of shoots down your theory doesn't it?

 

Most small business owners support raising the minimum wage to $12 an hour.

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Price increases in some good would be affected, but for the most party, there's no evidence that increasing the minimum wage would cause a significant increase in prices.

 

the start of the fiscal year for an owner he writes a budget..using the figures from the previous year...the payroll with any adjustments for raises is then determined...now if for some reason sales go up he will add people..if sales are down it cuts hours or jobs...its that simple...i have been an owner for over 25 years and i do just that way and so does everyone else whether you are a large company or a small one..

 

Washington now has the highest minimum wage, Oregon the second highest. There is no evidence of lost jobs or higher prices and this has been going on for more than a decade. Idaho had to raise theirs to keep low wage workers in the state. Poor people with living wages drive the economy more than anything.

 

Low income people in Oregon make more money than low income people in every other state except Washington. Prices in Oregon are no higher than elsewhere. Your chart has no relevance.

 

Price increases in some good would be affected, but for the most party, there's no evidence that increasing the minimum wage would cause a significant increase in prices.[/QUOTE]

Most small business owners are for it because they will profit from a small bump in the minimum wage.

Say a business produces 100 cogs a day. They charge 10.00 for a cog. They have 5 employees they pay 10.00 an hour. They now pay these employees 13.00 an hour. That is an increase in price to them of 3 x 5 x 8 hrs. per day, 120.00.

They now charge 12.50 per cog to offset the price and make 1,250 per day as compared to 1,000 per day. That is a profit of 50.00 dollars once you subtract the increase in wages. The companies could also charge even more because now the increase in minimum wage gives them a legitimate excuse for raising prices.

So depending on your product or service, an increase in minimum wage could be potentially very profitable so of course many small business owners are for it. If you think they are supporting it out of some love for their employees well being then you are fooling yourself. And as I alluded to before, if this is done only regional then it is harder to raise prices but on a nationwide basis you will see all companies doing it.

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You are talking about raising the minimum wage at the federal level so yes, my chart is very relevant. Your story about one state has no revelance to a nationwide hike in the minimum wage.

 

So folks won't get laid off?

 

if profits go down then they will..if the owner raises prices too high sales will go down...so the owner will probably just cut hours at first..makes some workers start later and some go home earlier..

 

That still means less $$ for workers. This isn't what was intended is it?

 

No your chart has no relevance no meaning, no nothing. All it shows is purchasing power. That minimum wage workers had more purchasing power in the 70's says nothing about the current situation. The reason for that is that if you took everyone's income at every level you would get similar graphs and the level of costs vs prices in the past is no indication of current conditions. Primary to that is that in the 60's and 70's and into the 80's a person making minimum wage could afford an apartment of his own. That is not true of those making minimum wage now days.

 

right...if you look at a fast food place like when i buy my coffe at 5 am there used to be 5 to people working there and getting ready for the breakfast crowd..now when i go at 5 am there are only 2...the rest come in later about 2 hours later than before...

 

What you have just stated is the conservative lie.

 

what you just stated is the liberal lack of reality...do you a business?...dont think so...

 

That is typical conservative fear mongering. Here in Oregon where the minimum wage is the second highest in the country the minimum wage joints have just as many workers as elsewhere and their prices are no higher.

Hasn't it occurred to any of you how much the average worker is exploited. I have worked for more than one company where the profit was considerably higher than wagers paid. Companies make money off of employees. If you cut your employees you can't make as much money. Cutting employees because the minimum wage went up (on an otherwise thriving business) is like shutting down your machines because the cost of electricity went up.

 

Am I missing something then? It seems obvious.

 

you just dont understand how a business is operated..too bad...and in this state we pay a lot more here than you guys...oregon is just too redneck for me and too many dopers

 

because McDonalds is a very large corporation that has the resources to be able to absorb the extra labor cost
who it hurts is the small mom and pop business's that are already cutting it thin to be able to compete with the large corporations they don't have the resources to be able to absorb the extra labor cost so they have no choice but to raises prices that will make them that much less competitive with the large corporations

 

you are not missing anything..some people just dont understand how to run a business..maybe thats why most fail in the first 5 years...

 

Why not 40 bucks an hr?

 

Check your math. Typical labor costs for fast food are about 30% of revenue. A raise to $10 from $7 is about 45%. So, total costs rise by about 14%. That comes to about a dollar more for a $7 meal, not three or four as you suggest.

 

dont forget to add in the extra cost of workers comp ins and the added fice atx the emplyer pays..the more he pays the worker the higher those cost go up too.