All of your competition is also having to pay the new minimum, so they'll be raising their prices too.

And let's face it, the vast majority of 'minimum wage' jobs are ones that cannot be outsourced. They actually require a human being to be here, in front of the customers. The jobs that paid better were the juicy targets for outsourcing.

If your labour costs are 30 cents on the dollar of your cost of goods sold, and you have to double what you pay from the current federal minimum of 7 and a half or so, you charge 1.30 instead of 1.00, just like your competitors, and you keep the same profit you had before.

And, even though prices went up that 30%, all of your minimum wage earning customers now have 100% more in their paycheck to buy your goods. Not to mention the upward wage pressure on all jobs that are 'near' minimum without being 'at' it.

More than likely it will just reduce their profits a little. There's no reason for prices to increase.

Insane. You understand nothing about business. In a typical restaurant, labor is 30% of sales and most are netting 10-15%. That kind of wage increase would lead to a complete elimination of profit. It would probably put most small restaurants out of business.

Also what most people do not understand is that some businesses are in operation while losing money. They do are not always making profit. Increase their cost of operation by 30% and they will be forced to raise prices or shut down way sooner.

Only makes a profit, albeit a very-large one, 3 months out of the year. Loses money 9 months of the year.

Is open year round in order to retain staff as they would not be able to exist as a seasonal business. You can't run a Michelin ** that way.

I've been to seasonal towns, resorts, etc and patronized seasonal restaurants. Many of them operate in another location in the off season FT. and shut down the other one when the season is over. Lake George Ny and some Jersey shores places do the same. In fact a few popular ones have Florida locations for snowbirds.

Many businesses around here are indeed seasonal. In some towns they're ghost towns in the offseason. In my town most restaurants, etc are open in the offseason (sometimes limited hours) but in a neighboring town it basically shuts down. My town is about 50/50 locals/seasonal residents.

Even in non tourist trap towns, there are several businesses that close for parts of the year (ie ice cream shop).

It's not 3 consecutive months. It's Mid-September to mid-October then all of December and January.

Summer is largely dead here. Spring's kind of lame unless you like antiquing or hiking.

October for the leaves on the mountains, the dead of winter for people looking to get away where they can get snowed-in and be romantic in front of a fireplace and listen to the caroling kids on the town green. (I don't have the heart to tell them the kids are semi-pro...they get paid by the town to perform on a set schedule.) It's really a year-round resort area in W. CT...but most of the business is "Fire on the Mountain" (Remembering when the mountain actually caught fire, I wish they would not refer to the fall changing leaves that way...even if that is what the red, orange and yellow as far up the valley as the eye can see looks like) and allowing people to spend a weekend inside a Christmas-card scene.

As long as marginal revenue surpasses marginal cost, then the business should keep operation - regardless of fixed costs! Net margin after fixed costs is often negative, which is why business owners need lines of credit (often their own personal bank account) or a cash float.

My dad's restaurant lost money or didn't make any profits for 1 year plus before it started making any money. They went into their savings to pay for food and salaries but thank god, it's no longer a money losing business, they make profits but nothing crazy now.

That 15% to 20% that's now profit can either go into workers pockets or can be used to cut prices to compete.

if all those government loans and tax breaks that went to the owners went directly to the workers to set up this very type of economic organization. Right? See easy-peasy.

You think they'll 'reduce their profits'? You've got quite a sense of humour. They'll spout the usual 'fiduciary duty to shareholders', which is the same excuse they give now for paying employees crap. Look again at my example. Prices go up less than a third, but total spending power by those at the bottom doubles. Even with price increases, those folks wind up with far more spending power, and a lot of them rise out of poverty, and stop being eligible for a lot of government aid, since that money now actually comes in their paychecks. So government spending drops a lot as well.

You do not own a business

to the conversation?

A business measures it's profit as a percentage of the sale price, not as a set dollar amount per item. So if price an item sold for $1 and had .25 profit, for 25%, if costs rose .30 and they raised prices just .30 they would be lowering the profit margin of the sale. Actual profit in terms of dollar per item is the same, but profit margin drop.

So in reality most place will raid the cost enough to keep making 25% profit or whatever the previous ratio was. So that item will be priced about $$1.40-1.45 now depending on just how the math plays out.

If the person keeps just the .25 per item profit their agreement is that prices are rising around them and they need to take home more too. I'm sure they don't have to, but that's how they think, can't let the little guy have a break unless they get a bigger one.

But the general issues are the same as long as labour isn't the majority of your cost of doing business. Prices in industries that use minimum wage labour go up, but minimum wage workers get an increase in spending. Businesses whose customers are typically minimum wage get more business.

This isn't undoable - it's been done in various places, and it works. It doesn't destroy the economy or destroy most businesses, or even cause businesses to relocate. We hear the same 'We can't afford to raise minimum wage' every time before we do, and the sky doesn't actually fall when we do.

They won't need to raise them that much either. I'm sure no one would mind paying 50 cents more for a happy meal if it meant millions if workers would be getting much better wages and using less public assistance. Hell, it may even allow for a mid class tax cut.

And for most businesses only a relatively small fraction of your customers will have been minimum wage.

Yes, there are good arguments for a decent minimum wage. But these aren't them.

Who think labor ought to be free, all costs externalized onto the consumer, and profits tax-free.

to limit it to 'larger' businesses, with either lots of employees, or lots of money involved. Sure, there are start-ups run by people like that as well, but a lot of small businesses are also people who have to face their employees every day, which makes it harder to screw them over without buttloads of guilt.

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

-Laelth

My thoughts exactly

Makes good business sense, then they don't deserve to be in business

I know of an example business where the staff still make less than $15/hr after 6 or 8 years on the job (and probably won't til 20 years in or more), but they spend tens of thousands of dollars a year to let mgmt travel all over the place for things that don't really bring money in the door for the business, mainly because the boss loves to travel. If they went to 'teleconferencing', instead of sending him everywhere, everybody in the company could be at least at $15/hr without changing the nets.

If the problem is "competing in the global economy", maybe we need to stop competing in some areas.

Cheap imports made by cheap labor are distorting the value of labor here.

If those cheap imports are blocked, perhaps the price of goods will go up, and perhaps businesses will be obliged to bring wages in line with what it costs to produce goods in the US rather than the "global economy"...but, in theory, they will also be selling to their goods at the higher US rate as well.

Perhaps the problem is the economy is a rigged game that only works if it is "beaten" - using cheap labor but selling for premium prices.

If we require our trading partners to live up to our standards for health, safety, pay and benefits, suddenly they can't really provide imports that undercut locally made without actually creating some innovation, not merely making products with underpaid employees in unsafe environments.

But just the opposite is happening. We also still have an employment based health insurance model, so full time work will soon be a thing of the past in most cases.

I get so pissed off at all the all the attention being paid to headline news and other stupid social issue bullshit, and so very little to the very fabric of our citizens. ( Rant mode off )

Your last paragraph says it all though; at how the narrative is so biased against us, and how so many buy the "inevitability" of the "global economy" bullshit. It's studiously ignoring that this "inveitability" is not really inevitable, but a desired outcome and put into policy via corporatist influence. It's not a physical property or law of nature: It's lobbying by plutocrats.

There are prostitutes who raise their children at the landfill in shelters made of scavenged scrap materials. This is not something to aspire to.

Living wages are simply humane.

down to companies with small amount of employees. That would also encourage small businesses.

No business should be able to underpay. But you could offer tax incentives to truly small businesses to offset some of the additional expense. Not to 'small business' that has few employees but does billions in sales yearly, but to real honest to gods tiny businesses.

putting seatbelts in cars, fixing pollution of our air and water. Nobody went belly up, not one.
"They" were just plain wrong.

it become clear that they could pay more if they wanted to. Wanting to is the kicker here.
For instance, check out the reports of what the oil companies earning are when they're reported and then tell me I have to pay $3.40 plus for a gallon of gasoline because thats what it cost to make the stuff.
We have a rich man wanting all our money problem here in America, nothing more nothing less

They would have to offer health insurance to their employees. That's where a nationalized health care plan will help.

cry me a fucking river. It is going to have to be global pushback against these guys because they will just move the jobs if anyone complains (although there is a lot we could do with tax policy to prevent that).

We need to remember that 99% is a whole lot more than 1%. And we need to remind them of that. Whatever it takes.

a business's profits. I'm concerned with what WORKERS need, not some bullshit "profit". I don't figure those businesses that ask workers to consider their profits will give a flying fuck about me being able to put food on the table, a roof over my family's head, or new shoes for the baby. If they aren't making enough "profit" in their business, maybe they ought to give the business to the workers to run.

After all, the business could run without the owners, but it could NOT run without the workers.

have money to start a business and probably couldn't do it without a few becoming cut-throat business people.

We could go back to little mom and pop business started and run on shoe-string (I would like it). But those businesses aren't going to produce decent salaries for many; tax revenues for health care, education, and welfare; etc.

We've got ourselves in a mess and there really is no simple way out. Yes, we could nationalize all businesses and it would be great for a short-time and might even be better for us long-term; but, it wouldn't generate the revenue needed for health care, etc., very long (especially if we continue to be the war mongers of the world). Then again, I'd be happy living in a tiny -- less than 500 square foot -- house and riding a scooter to all the local restaurants and shops. I just wonder how many other people would be happy.

With all that said, the $15 an hour and other improvements should remain a goal of our society.

and run it as a non-profit. Of course they would still pay wages to workers, but if workers were paid and ran the business, what money came in would go to workers and not some owner.

However, I also agree with YOU, in that we're not going to get anything significant and long-term to ameliorate the plight of the working class world-wide without a total systemic change.

There are realities and market-drivers that we no longer need a F/T workforce...so reversing the end-of-F/T trend is largely impossible. They're already permanent...we don't need a society where the majority of the population works F/T in any job; there isn't enough work to justify that workforce or worktime. They've been permanent and intended towards since the Carter administration as an inevitable paradigm change. The war was over before you knew it started. (I wasn't born until after Reagan was elected and before he took office.) The solutions to ending economic-orphanism has to come from outside of the work-for-pay/benefits paradigm.

We're seeing that already on the benefits-side...there is a nearly-imperceptible push to divorce the old benefits structure (healthcare, retirement, safety-net insurances) from employment to government. That's really what Obamacare is. That's really what MyRA is. That's the future. It's a slow creep towards government-secured government-administered (probably-but-not-certainly privately-run) benefit. A semi-socialist capitalism.

We're yet to see how it's going to work on the income side unless we're going to start putting people on the permanent dole; a subsidy to not seek employment. That seems as bad of an idea as it will be unpalatable to the GOP. In some sense, I expect the final outcome to take the form of the majority of workers being freelancers doing multiple "micro-jobs." Local provision of local service. The end of careerism. Your table-server may also be your self-employed accountant and the library assistant and a boat mechanic. Their SO the doctor/tailor/organic-farmer. Not all at the same time and not all regularly but cumulative to ~35hrs/week and at a higher rate of pay than any of those would be F/T...micro-jobs.

It's not a bad thing...it's going to allow a lot of people a lot more flexibility in their employment as well as life-balance. It's already doing wonders for me...I don't want a F/T job. I like mowing lawns one day a week, being a P/T caterer and operating my own shoe-stringed self-employment. (I use the first two to meet basic expenditures, I own and freelance as a communications/development/PR specialist for NPOs. It's wildly-irregular but provides the bulk of my income. ($8000 one month, $200 the next...hence the lawncare and catering $1200/mo. nut))

You are not your job...but really shouldn't your job be you.

What you see as a problem...I see as liberation.

Cutting wages in order to increase profit margin is a temporary fix at best.

Walmart is learning this the hard way, as a lot of their employees can no longer afford to shop at walmart.

Conversely, increasing the pay of your employees makes them better consumers, and isn't that what we are striving for in a consumer based economy.

Perhaps the most famous example of it is Henry Ford, a pretty disgusting human being, who nonetheless was smart enough to realize that if he paid his workers enough to afford one of his cars, he'd sell a lot of cars.

"Anytime you hear any politician say we have to prepare our children to compete in the "global economy" get ready for a screw job."




K&R

teacher and they are coming for my employment rights and livable salary.