Contract raises vs. state minimum wage

[DriveInDriveOut]

But why do all these things cost more today than they did 20 years ago when minimum wage was like $3/hr.

Oh, wait. That's right. Minimum wage is almost 4 times higher today than it was back then.

Labor, the main reason goods and services cost more today than they used to.

Stick to your day job, economics isn't your thing.

 

[MAKAVELI]

Funny....

But if UPS did not raise their rates and gave us our raises and increases in H&W and pension, they would not make their $4B.

Eat the increased cost of labor or pass it on to the consumer, a concept that @DriveInDriveOut does not seem to comprehend.

The same goes for any increase in the minimum wage.

Companies must eat the increased cost of labor or pass it on to the consumer.

So is it OK for UPS to raise rates 5% or 6% every year for increased labor costs, but not OK for McDonalds to raise the cost of a Big Mac 5 cents for the same reason?

 

[Mugarolla]

Stick to your day job, economics isn't your thing.

Apparently not yours either since you still did not answer the question or refute the fact that UPS raises their rates due to the increased cost of labor, among other things.

So is it OK for UPS to raise rates 5% or 6% every year for increased labor costs, but not OK for McDonalds to raise the cost of a Big Mac 5 cents for the same reason?

Never said it wasn't OK for McDonald's to raise the price of their Big Mac.

I said it was a direct result of the increase in minimum wage.

For those who don't want to read this question, it may be long, skip it. But I would like our Economics guru @DriveInDriveOut to answer it.

You have a lawn mowing business. You have 4 guys working for you making $12/hr. It is a cut throat business, so your profit margin is very slim.

Uncle Sam now says you have to pay your guys $15/hr.

Where do you get that extra $12/hr?

Do you take it from your profit, you being the owner?

Nope. No money left for you then.

You raise the price of your mowing service.

Now Mom & Pop Catering has to pay you more to have their grass cut.

Do they take the extra money from themselves, or do they raise their prices to pay you?

Now, Joe's reception hall, who uses Mom & Pop to cater their events, now has to raise their prices to offset the higher prices from Mom & Pop.

I could continue this to the businesses that use Joe's, who now have to pay more, all because you charge more to cut grasses.

Remember, this does not take into account the extra labor costs and increased prices because Mom and Pop and Joe's have to pay their employees $3/hr more for each and every one of them.

Some businesses can afford to absorb the increase in minimum wage, but most cannot.

An increase in minimum wage will increase the cost of most goods and services proportionally.

So the minimum wage worker gets $3/hr more, spends that extra money on everyday needs because everything went up. He did not come out ahead.

The real losers are people like you and me. We did not get a raise because minimum wage went up, but we are now paying more for our goods and services.

In the long run, we lost and the minimum wage worker stayed the same.

Tear this apart if you can, but this is how the world works.

 

[MAKAVELI]

Apparently not yours either since you still did not answer the question or refute the fact that UPS raises their rates due to the increased cost of labor, among other things.



Never said it wasn't OK for McDonald's to raise the price of their Big Mac.

I said it was a direct result of the increase in minimum wage.

For those who don't want to read this question, it may be long, skip it. But I would like our Economics guru @DriveInDriveOut to answer it.

You have a lawn mowing business. You have 4 guys working for you making $12/hr. It is a cut throat business, so your profit margin is very slim.

Uncle Sam now says you have to pay your guys $15/hr.

Where do you get that extra $12/hr?

Do you take it from your profit, you being the owner?

Nope. No money left for you then.

You raise the price of your mowing service.

Now Mom & Pop Catering has to pay you more to have their grass cut.

Do they take the extra money from themselves, or do they raise their prices to pay you?

Now, Joe's reception hall, who uses Mom & Pop to cater their events, now has to raise their prices to offset the higher prices from Mom & Pop.

I could continue this to the businesses that use Joe's, who now have to pay more, all because you charge more to cut grasses.

Remember, this does not take into account the extra labor costs and increased prices because Mom and Pop and Joe's have to pay their employees $3/hr more for each and every one of them.

Some businesses can afford to absorb the increase in minimum wage, but most cannot.

An increase in minimum wage will increase the cost of most goods and services proportionally.

So the minimum wage worker gets $3/hr more, spends that extra money on everyday needs because everything went up. He did not come out ahead.

The real losers are people like you and me. We did not get a raise because minimum wage went up, but we are now paying more for our goods and services.

In the long run, we lost and the minimum wage worker stayed the same.

Tear this apart if you can, but this is how the world works.

So how would hiring undocumented workers and paying them $5 a day affect the cost of goods and services?

 

[DriveInDriveOut]

An increase in minimum wage will increase the cost of most goods and services proportionally.

I disagree.

Even if I was to accept the grossly over simplified logic you're using to discuss macroeconomics, the entire point of your argument is that you don't want people to be paid more because you want to buy crap for cheap. smh.

If a business can't afford to pay a living wage then they shouldn't be in business.

 

[Mugarolla]

I disagree.

Even if I was to accept the grossly over simplified logic you're using to discuss macroeconomics, the entire point of your argument is that you don't want people to be paid more because you want to buy crap for cheap. smh.

If a business can't afford to pay a living wage then they shouldn't be in business.

OK, now we're getting somewhere.

Minimum wage workers feel that if they're paid more, they will no longer be poor and will be able to afford more things.

This does not work.

There are many minimum wage jobs that are just that, minimum wage. Part time, retired people, college students home on break, etc.

They are not designed to raise a family of 5.

And paying them more will not help them. It will only hurt them, and the middle class.

It has nothing to do with me wanting cheap crap.

The experts, who know more than you and I, mostly agree that raising the minimum wage does not help the poor.

Here is only one article of thousands.

$15 Minimum Wages Will Substantially Raise Prices

 

[Mugarolla]

So how would hiring undocumented workers and paying them $5 a day affect the cost of goods and services?

You would think that it would make them cheaper.

I mean, they are paying $5/day instead of $15/hr.

But the money saved in labor costs just goes to the company's profits, not reduced costs.

 

[DriveInDriveOut]

The experts, who know more than you and I, mostly agree that raising the minimum wage does not help the poor.

Here is only one article of thousands.

$15 Minimum Wages Will Substantially Raise Prices

This is textbook confirmation bias. You sought out the opinion you wanted and you found it. There are many articles that will suggest the opposite. You know why? Because it's economic theory, not fact.

There are many minimum wage jobs that are just that, minimum wage. Part time, retired people, college students home on break, etc.

They are not designed to raise a family of 5.

I agree, these jobs were not designed to raise a family on. Unfortunately that is the state of the economy and the labor market. For the most part these jobs are not held by teenagers and retired people, that is fact backed up by data from the BLS.

Employers have been eliminating full time positions and shifting to a part time workforce for decades and reaping massive profits in the process. Thank goodness they have people like you to toe the line for them.

 

[MAKAVELI]

You would think that it would make them cheaper.

I mean, they are paying $5/day instead of $15/hr.

But the money saved in labor costs just goes to the company's profits, not reduced costs.

So lowering the min wage back down would have no effect lowering costs of goods and services. Got it.

 

[Mugarolla]

This is textbook confirmation bias. You sought out the opinion you wanted and you found it. There are many articles that will suggest the opposite.

The first article on Google. Page 1 article 1.

I agree, these jobs were not designed to raise a family on. Unfortunately that is the state of the economy and the labor market. For the most part these jobs are not held by teenagers and retired people, that is fact backed up by data from the BLS.

Agreed.

But just because they are held by people other than who they were "designed" for does not mean we need to give them a "living wage."

It is a minimum wage job. Don't start a family you cannot afford until you can afford a family.

Thank goodness they have people like you to toe the line for them.

I toe no one's line. These are facts which I gave you. And I have no narrative here.

UPS raises their rates and we get our raises.

So lowering the min wage back down would have no effect lowering costs of goods and services. Got it.

Theoretically, it should. Would it?

You're guess is as good as mine.

Ain't gonna happen.

 

[MAKAVELI]

Theoretically, it should. Would it?

You're guess is as good as mine.

Ain't gonna happen.

So min wage workers are screwed either way. Might as get paid more and adjust their lifestyle.

 

[DriveInDriveOut]

But just because they are held by people other than who they were "designed" for does not mean we need to give them a "living wage."

It is a minimum wage job. Don't start a family you cannot afford until you can afford a family.

Whatever man, we can keep doing it your way and support them through welfare and food stamps and medicaid I guess.

 

[PT Car Washer]

FedEx Ground consider their package delivery driver jobs Minimum wage, low skilled jobs. But you believe a UPS package delivery driver deserves to make $35/hr plus benefits for doing the same job. The only difference is UPS is Unionized. That is the only reason you make the hourly rate you do. I work with sorters making $35/hr PT working right next to a sorter making $11/hr.

 

[BakerMayfield2018]

FedEx Ground consider their package delivery driver jobs Minimum wage, low skilled jobs. But you believe a UPS package delivery driver deserves to make $35/hr plus benefits for doing the same job. The only difference is UPS is Unionized. That is the only reason you make the hourly rate you do. I work with sorters making $35/hr PT working right next to a sorter making $11/hr.

Life's not fair.

 

[Mugarolla]

Whatever man, we can keep doing it your way and support them through welfare and food stamps and medicaid I guess.

Not my way.

The problem is that even if you increase the minimum wage, they will still need Medicaid, food stamps and welfare. And everybody else will be paying more.

They do not gain anything.

I am not against it if it actually works.

Show me a reputable article that says different.

 

[MAKAVELI]

FedEx Ground consider their package delivery driver jobs Minimum wage, low skilled jobs. But you believe a UPS package delivery driver deserves to make $35/hr plus benefits for doing the same job. The only difference is UPS is Unionized. That is the only reason you make the hourly rate you do. I work with sorters making $35/hr PT working right next to a sorter making $11/hr.

And I'm pretty sure FedEx Ground rates are pretty much equal to UPS ground rates.

 

[BakerMayfield2018]

And I'm pretty sure FedEx Ground rates are pretty much equal to UPS ground rates.

 

[BakerMayfield2018]

Not my way.

The problem is that even if you increase the minimum wage, they will still need Medicaid, food stamps and welfare. And everybody else will be paying more.

They do not gain anything.

I am not against it if it actually works.

Show me a reputable article that says different.

 

[BakerMayfield2018]

FedEx Ground consider their package delivery driver jobs Minimum wage, low skilled jobs. But you believe a UPS package delivery driver deserves to make $35/hr plus benefits for doing the same job. The only difference is UPS is Unionized. That is the only reason you make the hourly rate you do. I work with sorters making $35/hr PT working right next to a sorter making $11/hr.

 

[Mugarolla]

FedEx Ground consider their package delivery driver jobs Minimum wage, low skilled jobs. But you believe a UPS package delivery driver deserves to make $35/hr plus benefits for doing the same job. The only difference is UPS is Unionized. That is the only reason you make the hourly rate you do. I work with sorters making $35/hr PT working right next to a sorter making $11/hr.

It's not what you think you a deserved to be paid.

It is how much a company is willing to pay you.

Don't like it, find another job.