[andyt]

But this is a samurai sword. It's the end of business as we know it, judging by the bleating. It was the same in BC, when the min wage was raised 25% in just over a year. And look at BC now, at the bottom of the economic barrel, struggling along while other provinces boom.

[Lemmy]

Minimum wages don't hurt business. It hurts unskilled workers, the very people it's supposed to help. A business doesn't care if they pay 5 guys $10/hr or 4 guys $12.50/hr. But the labour market cares that, at $12.50, there's now one guy not working who used to be (and can now NEVER be employed because he's not skilled enough to get a $12.50/hr job anywhere), plus three other new unemployed people who were just enticed to enter the labour market, in response to the increased minimum wage, but can't find work. So 4 people are now happier, 4 people are less happy and the business couldn't give two shits one way or the other.

[andyt]

Sure, sure, businesses can just cut positions and go on their merry way. That's why all the business people are whinging about labor shortages for their shit jobs and want the TFA system ramped up again. And of course we had huge, sorry yuge layoffs after BC raised it's min wage by 25%.

[andyt]

Minimum wage increases are 'supercharging' economy, says U.S. multimillionaire

http://www.cbc.ca/news/canada/british-c ... -1.3124917

[herbie]

Isn't that how business operates? Lets 1 guy go and tells the other 4 they have to work 25% harder?
"If the customer doesn't commit to a sale in 3 minutes tell them to go elsewhere!"
Makes me wonder as I noticed these shithole gas station/store combos in the Lower Mainland where as soon as they watered down "Grant's Law" they went to trying to run the store through an armoured windows slot.
Told 3 of them to tell your cheap bosses to fuck off and die. Where's a 7-11?

[Caelon]

Brenda Brenda:

If you have 10 people working for you and you pay them all minimum wage, you're either a big box store or an asshole who doesnt deserve loyal staff.

I did not say all 10 had to be at minimum wage. Employers have to maintain differentials so even in a fast food restaraunt you have team leads, shift supervisors, etc. Why would you take on extra responsibility if there was no economic advantage. If you are currently geting $15 and hour you would want to maintain a $3+ differential to those at the bottom. It is not just the minimum wage earner that goes up but all others within a reasonable proximity to the wage of one step below until you get to a point where the spread is sufficient to mask the change.

Is a $15 target for minimum wage reasonable? Eventually yes, and I am not talking 20 years. Move the minimum wage at least the rate of inflation annually and people will not be faced with siginificant cost pressure changes. That gradual increase is palatable for the workers, employers and the consumers that get to pay for it all.

You would yelp if you Big Mac meal went from $8 to $12 over night and start looking for cheaper alternatives until YOUR income rises enough to bring the higher meal cost into 'the affordable' range.

[bootlegga]

andyt andyt:

Sure, sure, businesses can just cut positions and go on their merry way. That's why all the business people are whinging about labor shortages for their shit jobs and want the TFA system ramped up again. And of course we had huge, sorry yuge layoffs after BC raised it's min wage by 25%.

I'm guessing you mean TFW, not TFA...the fact is most fast food places and retail places in Alberta were already paying more than minimum wage, at least when the economy was booming and most young people preferred to go to work in the oil patch for far more than the $13 or $14 McDonald's and Old Navy were offering here in Edmonton. That's also why the Tim Horton's in Fort Mac couldn't operate 24/7 during the boom - there simply weren't enough people willing to work for $17/hour when they could earn twice that in the patch.

The difference between 2014 and now is the economy in Alberta - the oil patch is not adding workers, they are shedding them and that means a labour glut (especially in the unskilled segment), not a shortage like we had for the past decade.

No matter some analyst at TD says, unemployment here is higher than it's been in more than two decades (and higher than Nova Scotia):

http://globalnews.ca/news/2867455/alber ... a-scotias/

The biggest problem with minimum wage increases is that eventually employers raise their prices and inflation eats up a significant chunk of their raise (usually the rest is lost to taxes/CPP/EI/etc.), leaving them barely any better off than before the increase. Minimum wage increases are nothing more than a giant hamster wheel for the poor.

The way to get the poor off minimum wage is to teach them skills other than how to make french fries or fold shirts for the sales table. We have to help those who want to help themselves and just accept that some people simply aren't willing to work hard enough to get ahead in this world.

[andyt]

It's amazing to me how wage increases at the bottom of the scale cause such massive inflation that the increase gets mostly eaten up, and that the taxman takes the rest, yet people who earn in the higher ranges don't seem to feel this effect and are glad of any raise they can get. The argument goes that few people work at min wage anyway, yet paying them a bit more has this huge effect on the economy. Amazing.

Also amazing to me to hear that minimum wage workers are all just lazy, and so deserve to get as little as possible.

[Public_Domain]

[Lemmy]

bootlegga bootlegga:

The biggest problem with minimum wage increases is that eventually employers raise their prices and inflation eats up a significant chunk of their raise (usually the rest is lost to taxes/CPP/EI/etc.), leaving them barely any better off than before the increase. Minimum wage increases are nothing more than a giant hamster wheel for the poor.

That's a myth. Demand determines prices, not businesses' costs. A business can't simply choose any price to charge and have people pay it. If the market price is $2, the market price is $2, no matter what the business's costs are. And any time a business raises prices, they'll sell less...ANY TIME.

[Canadian_Mind]

Lemmy Lemmy:

bootlegga bootlegga:

The biggest problem with minimum wage increases is that eventually employers raise their prices and inflation eats up a significant chunk of their raise (usually the rest is lost to taxes/CPP/EI/etc.), leaving them barely any better off than before the increase. Minimum wage increases are nothing more than a giant hamster wheel for the poor.

That's a myth. Demand determines prices, not businesses' costs. A business can't simply choose any price to charge and have people pay it. If the market price is $2, the market price is $2, no matter what the business's costs are. And any time a business raises prices, they'll sell less...ANY TIME.

If the business costs are in the $1.50-$1.75 range for every $2 product sold, that makes sense. However, if costs rise to the $1.75-$2 range for every $2 product sold due to minimum wage increases, some businesses will be making less money, some won't be making any money at all. In both cases the businesses will look at cost-cutting (reducing staff), increasing revenue by raising prices, or shutting their doors.




Personally, I have my money in real-estate and have just under 4 years left on my current term. I'd be quite content if this triggers a significant bout of inflation. Property worth more, getting paid more, same low mortgage payment (until 2020 at least).

[Lemmy]

Canadian_Mind Canadian_Mind:

If the business costs are in the $1.50-$1.75 range for every $2 product sold, that makes sense. However, if costs rise to the $1.75-$2 range for every $2 product sold due to minimum wage increases, some businesses will be making less money, some won't be making any money at all. In both cases the businesses will look at cost-cutting (reducing staff), increasing revenue by raising prices, or shutting their doors.

We need more information, specifically we need to know the elasticity of demand for the good in question. But if a business could simply raise prices, why wouldn't they do it before the minimum wage increase? The answer is they can't. Demand for their product determines price. Period. When you go to buy something, anything, you choose whether to buy on many factors but the business's costs isn't one of them. You, as a consumer, couldn't give a shit what the producer's costs are. All that matters to you is the product and its price.

Canadian_Mind Canadian_Mind:

Personally, I have my money in real-estate and have just under 4 years left on my current term. I'd be quite content if this triggers a significant bout of inflation. Property worth more, getting paid more, same low mortgage payment (until 2020 at least).

The real estate bubble we're living in is frightening. The fact that, in Ontario, the government through MPAC is, in large measure, responsible for creating the inflationary bubble in real estate is especially troubling.

[uwish]

bootlegga bootlegga:

andyt andyt:

Sure, sure, businesses can just cut positions and go on their merry way. That's why all the business people are whinging about labor shortages for their shit jobs and want the TFA system ramped up again. And of course we had huge, sorry yuge layoffs after BC raised it's min wage by 25%.

I'm guessing you mean TFW, not TFA...the fact is most fast food places and retail places in Alberta were already paying more than minimum wage, at least when the economy was booming and most young people preferred to go to work in the oil patch for far more than the $13 or $14 McDonald's and Old Navy were offering here in Edmonton. That's also why the Tim Horton's in Fort Mac couldn't operate 24/7 during the boom - there simply weren't enough people willing to work for $17/hour when they could earn twice that in the patch.

The difference between 2014 and now is the economy in Alberta - the oil patch is not adding workers, they are shedding them and that means a labour glut (especially in the unskilled segment), not a shortage like we had for the past decade.

No matter some analyst at TD says, unemployment here is higher than it's been in more than two decades (and higher than Nova Scotia):

http://globalnews.ca/news/2867455/alber ... a-scotias/

The biggest problem with minimum wage increases is that eventually employers raise their prices and inflation eats up a significant chunk of their raise (usually the rest is lost to taxes/CPP/EI/etc.), leaving them barely any better off than before the increase. Minimum wage increases are nothing more than a giant hamster wheel for the poor.

The way to get the poor off minimum wage is to teach them skills other than how to make french fries or fold shirts for the sales table. We have to help those who want to help themselves and just accept that some people simply aren't willing to work hard enough to get ahead in this world.

Well said Boots!

[BeaverFever]

$1:

The biggest problem with minimum wage increases is that eventually employers raise their prices and inflation eats up a significant chunk of their raise (usually the rest is lost to taxes/CPP/EI/etc.), leaving them barely any better off than before the increase. Minimum wage increases are nothing more than a giant hamster wheel for the poor.

Let's unpack this:
- Inflation eats up the wage increase, therefore lets not increase the wage:

Inflation is driven by many things, like the price of oil, energy, grain, etc. The minimum wage in local jurisdiction has very little impact, especially in a global economy.

Inflation happens regardless, so raising the minimum wage actually leaves them with more money in their pocket, not less.

- The rest is lost taxes, CPP, etc.
CPP and taxes are not 100% of income. A worker in Alberta earning $12.20 per hour and working full-time (37.5 hours per week, = $23,790 per year) will have a net federal and provincial effective rate of 10.01% and will have an after-tax income of $21,409. Compared with $19,956 at the previous rate of $11.20, that is an increase to after-tax pay of almost 7.33%, almost $1500 per year, several times the rate of inflation.

https://simpletax.ca/calculator

Lastly as Andy said, it's comical that people somehow only think raises affect inflation when its a minimum wage being raised. Nobody seems to think anyone else wages, especially THEIR raises affect anything. When have any of you said "oh, no thank you, I don't want a raise, it will just drive inflation and I'll be worse off than before".

[Lemmy]

BeaverFever BeaverFever:

Let's unpack this:
- Inflation eats up the wage increase, therefore lets not increase the wage:

Inflation is driven by many things, like the price of oil, energy, grain, etc. The minimum wage in local jurisdiction has very little impact, especially in a global economy.

Yes, inflation happens for many reasons. Mostly it happens as a hedge against inflation. It's a self-fulfilling prophecy.

BeaverFever BeaverFever:

Inflation happens regardless,

Inflation mostly doesn't happen anymore BECAUSE we know to mostly stop it.

BeaverFever BeaverFever:

so raising the minimum wage actually leaves them with more money in their pocket, not less.

Not following your logic now.

BeaverFever BeaverFever:

Lastly as Andy said, it's comical that people somehow only think raises affect inflation when its a minimum wage being raised. Nobody seems to think anyone else wages, especially THEIR raises affect anything. When have any of you said "oh, no thank you, I don't want a raise, it will just drive inflation and I'll be worse off than before".

That's an argument in favour of union work: that higher wages in one place will cause higher wages elsewhere. Problem is, that theory isn't supported by empirical evidence. And the reason it isn't is that it, as Boots posted above, ignores the power of demand. Businesses can't simply pass costs on to consumers because demand is independent of business costs.