$20 isn't great for places with less cost of living than California. What's important to point out is that for hourly employees a large rate increase can easily be followed by reduction in hours so the net benefit is about zero.
Yeah, it's a pessimistic take on good news, but companies are going to do anything to maximize the bottom line, every time.
While it’s true that most corporations are going to optimize every dollar out of everything they can (no matter how scummy), it’s not like these places were operating with a surplus of staff.
Most of them had exactly as many crew working exactly as many hours as needed at any given time…hence the panic if anyone dares to call in sick or request time off.
If they don’t have enough staff, they can’t serve customers well enough to make all their money.
Now I imagine that’s part of the reason why they tend to love franchising out their businesses – pass losses along to the franchise operators and still keep their money coming in no matter what changes.
While the net take home might be the same, those people are getting more hours to do other things. I didn’t do an exhaustive search but it seems like before this the minimum wage was $16 an hour. They could be seeing as much as a 25% increase in wage which means they get the same paycheck in 20% less time. That can enable people to spend less on child care, pick up other shifts, make better/less expensive meals, or just enjoy their free time. So pay might be the same but there is still a net benefit.
"Our merchants and masters complain much of the bad effects of high wages in raising the price and lessening the sale of goods. They say nothing concerning the bad effects of high profits. They are silent with regard to the pernicious effects of their own gains. They complain only of those of other people.”
― Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations
Legitimate possibly stupid question: California is a massively huge state with huge metropoli as well as tiny towns. How does a blanket rate increase work without harming the tiny towns?
But how does it work when the median pay in one place in California is $160,000, and in the other it’s $35,000? (Real numbers. Also bearing in mind that $20 on a 40 hour work week is $41,600/yr.) The economic structure of each town, village, or city is not the same. This makes people unable to buy food, or medicine. We sacrifice population to fix the wrongs of the past in an irresponsible way.
And by the way, I’m pro minimum wage increase so hard, it is stupidly broken. It seems though, that such dramatic increases at a large scale in a short time would forget the small communities and basically uproot them into chaos. Just so Apple engineers can go to work with their breakfast burrito made correctly, finally.
Obviously I want all of us to be paid a reasonable salary, but it’s because of this concept you mentioned that I can’t wait for time to pass and we can see the outcome. It will absolutely help our argument if we can prove that a burger won’t cost $30 now and that stores won’t close because of it.
Because if it legitimately hurts local towns, you have even bigger issues to deal with. I live in NC and you very genuinely cannot live here on a minimum wage of $7.25. In fact, I’d argue that $12-15 (effectively the new minimum wage in my city going by what fast food pays) is pretty hard to live on in my southern state which is by most accounts pretty cheap to live in. California is much more expensive, so I’d argue that a $20 min wage is actually pretty reasonable.
The one big employer in that tiny town can probably get away with paying whatever because there’s no competition in a tiny town, this is enforcing a wage increase for the lowest paid people.
To the extent prices increase, it’s only a percentage of a percentage. Even if the cost is 100% passed along to the consumer, it’s a 25% increase in the price of labor, which is 30% of the cost of a burger.
So apparently (from Google) the Big Mac combo is $18 already in California, and the $5.40 of that which is labor would go up to $6.75, for a total new maximum price of $19.35.
Meanwhile, the poorest people in the state are getting a 25% pay raise, from $33k to $41k annually if they’re full time. That’s a huge stimulus because poor people spend the money they earn.
Haha I mean I did get that number from a Fox News article so that is probably like LA prices but yeah. The point scales with price so I just picked one from an article.
Oh honey, no. Right direction, but no. Very very dew people get even half the value they create for their masters in the rare slivers where they’re allowed to do real work.
Surplus labor value. Wouldn’t be a big deal if we all equally owned all the businesses we work for. That surplus labor value would still flow to the workers.
But while we suffer a capitalist waynof life, those funds are siphoned upwards to the 1%, who then use the money stolen from us to purchase the government over time.
This is why end stage capitalism is not preventable with reforms. You just delay the inevitable. The early 20th century labor movements only bought us a little bit of time. All of those people who fought, lost, suffered, died… it was all for just a fuckin delay?
We should thrive, not just survive. Yall have no idea how much has been stolen from us. Me neither. Who knows what could have been if we weren’t just complete shitters 24/7.
This is it right here. $20/hr wouldn’t even seem too outrageous if compensation had kept pace with productivity and profit margins. If anything, it’d be on the lower end and you wouldn’t be able to sustain a decent living without splitting the cost up with someone else.
How is it that legislatures can pass tax law which use %s that automatically scale with income/sales/property values, but they can’t figure out a way to pass wage laws that use %s to automatically scale with COL/inflation? Imagine hardcoding a taxable $ amount, and then not updating it for 30 years…
That’s part of how it gets passed. The problem with setting it with an auto-increase is that it creates a situation where we might not ever pass another law about it because if we get it wrong on the high side Democrats will block any change and if we get it wrong on the low side Republicans will block any change.
A few years ago when the Fight for Fifteen was at its height, Mitt Romney proposed a minimum wage that auto-increased with inflation and he put the starting rate at…$10. And included some crazy cuts to Social Security and stuff so it was never going to happen but that’s what I mean about the numbers being so far apart. $10/hr is so low that the left flank of the Democrats would reject it, which means you need more Republicans, and you’ll just never get enough Republicans for a minimum wage increase.
This is why Poverty Level hasn’t changed to match anything close to resembling reality in decades.
We would just do the same thing. I wish he didn’t but we already changed how Inflation is measured in the 1970s to remove Housing, Allow Canned Chicken instead of actual chicken. It’s all a big pissing game from on high.
Over the past decade, California has doubled its minimum wage for most workers to $16 per hour. A big concern over that time was whether the increase would cause some workers to lose their jobs as employers’ expenses increased.
Instead, data showed wages went up and employment did not fall, said Michael Reich, a labor economics professor at the University of California-Berkeley.
“I was surprised at how little, or how difficult it was to find disemployment effects. If anything, we find positive employment effects,” Reich said.
Quoted from the article and emphasis added for those with reading comprehension difficulties.
Wages got decoupled from profits many years ago. These sorts of increases are about bringing them back in line.
Well that’s very interesting plot twist, I’m almost concerned about as long as minimum wage grows higher and higher company tend to mass layoff it’s worker & replace the worker with robot equipment
But your explanation give glimpse of hope for everyone, maybe increase minimum wage it’s not bad at all
But let’s see how long it will last bc you know… companies only care about profits and profits
Well that’s very interesting plot twist, I’m almost concerned about as long as minimum wage grows higher and higher company tend to mass layoff it’s worker & replace the worker with robot equipment
Not really. This same saw about minimum wage increases leading to inflation and unemployment gets pulled out every time the discussion comes up. And while I am sure there is a point of diminishing returns, the doom and gloom has failed to materialize time and again. I’m old enough that I was working through several US Federal Minimum Wage hikes and have heard the same claims every time. And while there will be some marginal rise in prices, it will be nothing like the rise caused by actual inflation and is really just businesses using the opportunity to adjust prices up while having a convenient excuse.
Worker replacement with automation also isn’t new. The industrial revolution was devastating for many sectors. Weaving used to be an actual cottage industry, with people renting time on looms or making cloth at home. Now, we all buy mass manufactured textiles made in massive, highly automated factories. Sure, it sucked for people dedicated to weaving at the time, but it’s been a long term good for society. People and markets eventually adjusted, and people now benefit from cheaper textiles. It’s a cycle we’ve run through with many products and we’ll run through it again with many more. The real test of a society isn’t in that society trying to hold back progress, it’s in how we protect the dignity and well-being of the affected workers as the shift happens. We’ll need strong social services to support workers whose jobs are automated away. Holding down wages doesn’t do that, it only enriches the already wealthy by allowing them to capture more profit at the expense of the workers.
The problem is that when minimum wage increases, that same percentage increase does not happen to ALL incomes. So businesses passing on the cost are fighting over a pot of disposable income that isn’t keeping up.
We can’t keep raising wages at the bottom unless the rest of the workers can afford the increase in prices. Otherwise it leads to cutbacks in non-essential spending and that will cause job losses as businesses tighten their belts on diminishing sales.
It’s also causing businesses to reevaluate the consequences of replacing workers with machines. The McDonalds in my rural town just did away with ordering at the cash register inside the restaurant. You now have to use a kiosk to place the order. That’s one job gone.
Kiosks are not new. Fast food places have been dabbling with that system for almost a decade now, and not even as a response to rising minimum wage. Even if you turn back the clock on minimum wage increases, any advances in automation are here to stay. Big corporations are going to continue to find ways to replace workers with robots as soon as it becomes economically viable regardless.
The problem is that when minimum wage increases, that same percentage increase does not happen to ALL incomes.
Likewise, the cost increases will not be felt by all consumers, because not everyone eats fast food.
So businesses passing on the cost are fighting over a pot of disposable income that isn’t keeping up.
Then they should introduce more efficiencies that allow them to lower cost so they can be competitive again. This is capitalism at its best.
The McDonalds in my rural town just did away with ordering at the cash register inside the restaurant. You now have to use a kiosk to place the order. That’s one job gone.
If a job cannot pay a living wage, it should not exist. Being replaced by robots is a good thing. There’s another job in a factory creating these kiosks, or as a service tech repairing them.
Well I guess the Pizza Hut restaurants will be investing in drone delivery then, because their delivery drivers hit the unemployment line. They are part of the cuts. They don’t have the training to be a technician, and aren’t likely to get it in 6 months of unemployment.
Fast food has spent millions making the operation as efficient as is humanly possible. The only place left to cut is the humans. That’s what’s happening. It’s not difficult to make a fast food machine. It might even make better quality food. But the machine won’t be made in the US. The workers won’t be retrained to service them - that task will get outsourced, just like fixing the existing machines is outsourced in the current restaurants.
It’s easy to talk about “capitalism at it’s best” if you’re not the one holding the pink slip, wondering how you’re paying the bills on half an income from unemployment. Thankfully, we have subsidized healthcare in California. But that money comes out of everyone’s pockets, whether they eat fast food or not.
Unemployment in California (and the US) is quite low. There’s no shortage of jobs. And there are lots of job training programs, though we could always use more.
We didn’t lament the loss of farrier jobs when we switched from horse drawn carriages to automobiles. Progress is good.
Well, let’s see how loudly folks start screaming when AI actually gets good enough to replace the skilled workers. But they can be retrained, right? You want to convince me that progress is good, show me legislation that requires retraining as a condition of replacement. If they won’t make it a law, it won’t happen without a lot of pain and suffering for the displaced worker.
Requiring companies to pay for their workers retraining would be an unreasonable financial burden on them. But paying via taxes is a totally fair requirement, and one that California is continuously expanding.
It’s 50 miles from where I live to the nearest community college. So if a laid off FF worker needs to retrain via an institution, they will spend at least $20 each day in gas, assuming they can afford a car. If they attend 3 days a week, there goes $240 of their unemployment each month (gas is $5.50/gal and there is no public transit option). I don’t know what they do when unemployment runs out in six months. Maybe join the homeless? That seems to be a popular option these days.
Don’t buy into the “workforce training is not the place of companies, it’s the place of institutions” lie. If it had not been for my internship at a company prior to graduation, I would have struggled to get a job out of college. It took my friend almost a year to find a job for less than I was making. Job experience is king, and you won’t get it from an institution. School teaches the basics, and the rest is on-the-job experience.
Sorry, I got banned and then let the conversation lapse.
It’s 50 miles from where I live to the nearest community college. So if a laid off FF worker needs to retrain via an institution, they will spend at least $20 each day in gas, assuming they can afford a car. If they attend 3 days a week, there goes $240 of their unemployment each month (gas is $5.50/gal and there is no public transit option). I don’t know what they do when unemployment runs out in six months. Maybe join the homeless? That seems to be a popular option these days.
This is what I would call a failure of institutions. Government should be ameliorating all of these problems.
It’s not really a company’s concern. They exist to profit. Government exists to improve people’s lives.
Seeing that minimum wage should be at least $26 an hour if it had kept up with inflation, $20 for a selected group of workers, in California is such a fucking stupid thing to get twisted about.
I don’t understand US wages. I don’t make anywhere near that much as a plumber. 26 bucks an hour is insanely good salary. That’s more than what 95% of people in Finland earn.
$26 an hour would have negative effects on minorities and young people. Right now people with little work experience and education can easily still have a job. That would not be the case if the minimum wage was increased, since fewer companies would be able to afford to pay you $26 an hour to be trained
Median wage is about 20€/hr but it’s not in any way uncommon to earn way less than that. My SO makes about 12€/h assembling electrical switchboards and she used to make even less when working in daycare. 20€/h is considered a great wage. I dont think any of my friends earns that.
Oh hey I lived there for years and currently live literally 15 minutes south in a nearby city. Downtown long Beach is pricy as heck cause it’s rich people area by the beach. There’s Def under 2k 1 bedrooms out there. Heck I lived in a 2 bedroom 2 parking, mid, gated apartment complex in long Beach for 1550 a smidge over a year ago. I currently live 15 minutes south in a nearby city in a decent gated community, 2 bedrooms, 1 parking, 2200 monthly and management is fairly solid at fixing stuff quickly.
Just to put stuff into perspective. Minimum wage should still be over 20 here for everyone, it’s crazy that it isn’t since everything is so expensive.
Yes but we have to pay private companies that recursively gouge us for medical care, housing, etc. A studio apartment in Los Angeles is ~1k/mo and won’t rent to you unless youre making 3k, healthcare, if you have a chronic condition like diabetes, can easily exceed 1k/mo, and food is both trashy and overpriced here.
Consider that out of your wages in the US (in general) you need to pay your own medical insurance and any other benefits like disability or long-term care, fund your own retirement, your kids’ future college education, car payment, car costs, house payment/renr, and then there’s taxes on top of all that.
And businesses charge you like you have none of those concerns, they’re designed to extract every possible penny while offering just enough service to keep you from being angry enough to leave to the competitor - if there is one.
Having travelled quite a bit in Europe it’s just different. Despite the economic upheaval since covid, I find prices more reasonable (not cars or fuel, sorry Americans. Car costs are nuts.), travel is easy, rents aren’t as crazy, and of course the State does take more tax but Europeans get so much more back that Americans have to pay for out of pocket. No idea what other fees are like for necessary things like cellular or home data connections. We also don’t tax our businesses for squat, relatively.
That’s why American wages are nuts. We have to pay out of pocket for things that the EU gets out of taxes, plus different lifestyles.
Not really a comprehensive list, but just the gist of what American wages are expected to cover. And a lot of American wages are absolute crap, we just don’t get to see that in this example.
Yeah but how much does your health care cost in Finland?
In the USA, take out a few hundred Dollars a month, just for the privilege of seeing a doctor. Then it pays nothing for you until you go over some threshold (“deductible”) of something like $2000 to $10000. Also, all drugs cost 10x more than outside of the US.
Fast food work is something few want to do and hard to keep staffed. If you make it $20/h, any other job that seems more appealing will have to match or beat that wage.
Actually, it is. The owner decided to match the wage increase to dodge the controversy, though it seems the question of whether the law actually covers Panera will need to be settled in court for a definitive answer.
At first, it appeared the bread exemption applied to Panera Bread restaurants. Bloomberg News reported the change would benefit Greg Flynn, a wealthy campaign donor to Newsom. But the Newsom administration said the wage increase law does apply to Panera Bread because the restaurant does not make dough on-site. Also, Flynn has announced he would pay his workers at least $20 per hour.
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