»Are minimum wages wise?«
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 I recently saw a discussion about minimum wages and an expert said that in the countries where they have minimum wages the unemployment of the uneducated is higher. Why? Because educated/qualified personnel will get higher wages anyway (= the minimum-wage-law doesn't apply anyway) while the very unqualified don't get hired because the employer does not want to pay higher wages than what the employee is worth.  posted by knn |
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| in-my-opinion.orgPoliticsPolitics and Crime (Assorted topics)Are minimum wages wise? |
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 It helps the menial labourers, who could toil for very long and still draw too little. It protects the interest of unskilled labour in physical jobs, since they are guaranteed that level of income at least, and can't be exploited for lesser. For more white-collary jobs though, perhaps the law undoes itself  posted by ryder |
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ryder: It helps the menial labourers, who could toil for very long and still draw too little. It protects the interest of unskilled labour in physical jobs, since they are guaranteed that level of income at least, and can't be exploited for lesser. I just have stated the opposite: They don't get EMPLOYED in the first place. posted by knn |
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knn: The don't get EMPLOYED in the first place. I don't think that's true. Any employer who understands that he needs a large amount of workers for a particular job realises that hiring contract labourers (=who fall under minimum wage requirements) would be easier than having factory or regular labour who would require a higher salary anyhow, with fund and health benefits and so on too. This is why they prefer contract labourers, and why they tend to be exploited, and why you have minimum wages to protect them. posted by ryder |
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Let me state again: THEY WOULDN'T BE HIRED IN THE FIRST PLACE. You are arguing "If an employer could choose then he would choose the cheaper workers". That is a different topic. While I state: Work that is not worth the minimum wage would not be done, or would have to be done with government subsidy. posted by knn |
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 ryder: I don't think that's true. Any employer who understands that he needs a large amount of workers for a particular job realises that hiring contract labourers (=who fall under minimum wage requirements) would be easier than having factory or regular labour who would require a higher salary anyhow, with fund and health benefits and so on too. This is why they prefer contract labourers, and why they tend to be exploited, and why you have minimum wages to protect them. or they could hire illegal immigrants and pay them very little... ...what do you think the price of an apple would be if the people that picked them were all payed the national minimum wage? (just an example) posted by allone |
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knn: While I state: Work that is not worth the minimum wage would not be done, or would have to be done with government subsidy. You're looking at a minority condition. Companies that have their own contracted labour for the usual unskilled work of loading/unloading, shifting, serving etc. would of course find it atrocious to pay, say, 50 bucks for a job worth 30 bucks. But a majority of small-scale industries have no option but to turn to contracted labour, as for them it would be more expensive in the long run to have organized labour. The money only serves to increase purchasing power of yet another group in society, which increases the strength of the market. In a few countries, yes, they do have a government subsidy, which means the employer ends up paying lesser than he originally did, although the minimum wage rate was increased  allone: or they could hire illegal immigrants and pay them very little Well it is true that the law does not have full blanket coverage to include these people as well, but then it's a gamble with the enforcement agencies. allone: what do you think the price of an apple would be if the people that picked them were all payed the national minimum wage? Pretty high, yes, but that's what you have government subsidy for, at least in some developing countries where minimum wage is seriously implemented. Inflation is another concern arising from this, but as I understand how it has been implemented in India, the Consumer Price Index is adjusted with a 'Variable Dearness Allowance' to compensate. Of course it would affect normal taxpaying citizens in urbanized countries. I could turn your question around saying, consider the exorbitant sums paid to people higher up on the company's ladder, and reducing unwanted expenses by them could help strengthen a company's financial position positively rather than impoverishing a deprived person further. This seems to be a popular question though: The costs and benefits arising from minimum wages are subject to considerable disagreement among economists, though the consensus among economics textbooks is that minimum wage laws should be avoided whenever possible as the costs exceed the benefits. While the business lobby has campaigned against minimum wage hikes by arguing that they undercut employers and would give pay raises to people who do not need them, recent research reveals that many minimum wage earners are not teenagers working for pocket money, but impoverished adults mired at the bottom of the pay scale.
The EPI reported that approximately 44 percent of minimum wage laborers work full time, and a minimum wage worker is responsible for more than half of his or her total household income, on average. The group projected that most of the increase in income resulting from the policy would be concentrated in the lowest income strata. The Fiscal Policy Institute (FPI), a think tank focusing on New York State policy issues, challenges the arguments made by the business community that a higher minimum wage would negatively impact employers. The Institute found that following an increase in New York's minimum wage in January to $6 per hour, two industries with among the highest concentrations of minimum wage workers – restaurant and retail businesses – showed strong job growth in recent months that actually improved over last year and outpaced the overall rate in the state. FPI economist James Parrott also contended that conceivably, a minimum wage increase could even foster economic growth. Since the low-income people who would benefit are more likely to spend than to save, he said, "in effect, you're redistributing money from business owners or from higher-income consumers… to lower-wage residents who are going to spend every dollar of that, [and] you can get a net positive economic effect out of that." posted by ryder |
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 knn: Because educated/qualified personnel will get higher wages anyway (= the minimum-wage-law doesn't apply anyway) while the very unqualified don't get hired because the employer does not want to pay higher wages than what the employee is worth. When I was a shift manager at a fast food restaurant, it was my job to hire/fire people for my shift. I needed to maintain half a dozen crew members on my shift... 3 to make food, 2 to run registers, and 1 to run drive-through. Minimum wage in the US is $5.15 right now, I believe. Thus if I were a shift manager there again, I'd have to pay each of my employees $5.15. So why would removing minimum wage make me hire more people for my shift? Why wouldn't it simply make me pay each of my crew members less? posted by Tiefling |
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Tiefling: So why would removing minimum wage make me hire more people for my shift? Because for a lower wage they will spit into the buns. Moreover the question is also, whether you would hire MORE if the minimum wage would be, sayl, 20$. posted by knn |
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knn: Because for a lower wage they will spit into the buns. If they spit into the buns, then I'll fire them and hire someone else. That's the great thing about removing minimum wage --- there's always someone willing to work for less money than you. posted by Tiefling |
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We have different minimum wages for different occupations..  Also see  doh.. seems like communism.. knn: Moreover the question is also, whether you would hire MORE if the minimum wage would be, sayl, 20$.
Woah how much would educated labour cost then? You can't hike it to that much, simply because unskilled labour is not worth more than skilled labour. But they do make it seem like that here though
posted by ryder |
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The time now is 24 May 2012, 18:00 php B.B. |