Mitch Albom: The price we'd pay for $20 minimum wage

[TexasTowelie]

You can force businesses to raise wages, but you can’t force them to keep workers. And study after study, expert after expert, shows that, eventually, the higher the wages demanded, the fewer positions there will be.

Follow this to its logical conclusion, and at a certain point, if a business can’t afford to pay the minimum salary to the minimum workers it needs, it closes.

In which case, even more jobs are lost.

The rub with the raise

With that in mind, let’s skip the headline-grabbing sound bites and look at some facts.

In Seattle, which is moving towards a $15 minimum wage by 2021, a study conducted by the University of Washington last year showed employers were already reducing hours, with a net effect of reducing low-wage employees’ earnings by $84 a month.

Read more: https://www.freep.com/story/sports/columnists/mitch-albom/2019/07/28/mitch-albom-rashida-tlaib-20-minimum-age/1847078001/

Note: This editorial is in the Detroit Free Press which is rated as left-center by https://mediabiasfactcheck.com .
https://mediabiasfactcheck.com/detroit-free-press/

[OnlinePoker]

1. Look at places like McDonald's with their ordering kiosks

Or all the stores converting to automated checkouts. Eventually, there will be very few minimum wage jobs available because businesses will automate whatever they can. The automated systems may have a higher upfront cost, but they will pay for themselves within a year or two and, aside from occasional maintenance, no human interaction will be required.

[TexasTowelie]

2. The kiosks also don't call in to report they are unavailable to work

when someone in the family is sick or when the vehicle breaks down.

In addition, there is a fixed administrative cost to keep employees on the payroll. Those costs include paying Social Security taxes, workers compensation premiums, health insurance (for those fortunate enough to qualify), and payroll administration that are not included within the wages paid to workers which are not paid to automated options. Most places that have someone smiling at the counter when they hand you the burgers, shakes, and fries won't be able to compete.

[cojoel]

6. they do need routine maintenance and upkeep

Beyond basic cleaning that work is more skilled (and expensive) than the labor they replace. Consequently demand for more skilled workers rises while demand for less skilled workers drops. It is presumably not 1-1 or automation would not be viable.

IMHO we need to find some way we can start less skilled workers on the paths to this kind of skilled work, without requiring all the rigors and costs of a college education.

[rickford66]

3. Automation is inevitable whether wages rise or not.

Keeping unpaid slaves would cost more than automation.

[comradebillyboy]

5. There it is...

[Igel]

7. Not for a lot of things.

Even the huge outcry over how so many jobs were going to be lost was often a lot of marginally informed experts in various fields opining about what might could happen, esp. in other fields. Then that information--I use the term loosely--was shouted from the rooftops in incomplete form, pointing out not what might happen as "might" but as "will," and ignoring all the fields were job losses were unlikely. Moreover, if there was a 5% chance of a 10% loss of jobs in a given field, that field was just listed as "subject to job loss due to automation" with the reader-side inference that it was a 100% chance of 100% of the jobs' being lost.

What's disingenuous is the kind of claim that as many jobs will be gained as lost; that the increase in desirability of the jobs gained will make up for the suffering experienced by the others who lose their jobs; or that increasing the cost of labor has no effect--or, even worse, since everybody now has more money, everybody's wealthy.

[ret5hd]

4. The only solution: Slavery.

It's hopeless. Don't try. Give up. Resign yourselves to your fate!

[flotsam]

8. They cut my hours, they cut my hours!

What? Two extra days off and I get the same net pay??? That's the part of the equation they never mention.

[rickford66]

9. Really ?

Why not ask to have two more days off ?

[flotsam]

10. Because I wouldn't get payed for those hours

and those two extra days off each week-it is up to me whether to enjoy them as leisure time or to take a second $15 per hour job and increase my income in a meaningful way.

Say I work 4 hours a day 6 days a week at $10 an hour for gross pay of $240. At 4 days I work 16 hours at $15 for the exact same gross pay. If I work the other 2 days elsewhere 4 hours a day I will gross another $128 and my weekly gross goes to $368. If you think that's not meaningful you're crazy

[rickford66]

12. Your post implied you worked less and received the same pay.

If that were the case, work even less.

[flotsam]

13. Yes EXACTLY

You could. Or you could split it and work 4 days at your old job and one day elsewhere. But whatever the outcome it would be your choice. It's not that hard to understand.

[fpublic]

11. Fercrissake! This is not the neo-liberal underground!

Some in this thread have swallowed whole the neo-liberal bait so deep they think the tug on the line is from some sacrosanct "labor market".
This is the Democratic Underground, where you are supposed to understand that our economy is supposed to work for everyone if we demand it. There’s no voodoo market in which minimum wages are too high. They are higher in many places yet they can employ and provide healthcare, childcare, social security, infrastructure, whatever is demanded of government.
Our current minimum wage is inadequate because of our economy is undemocratically captured by greed.
3 super-rich men have the wealth of nn% (don’t recall but something like 50%) of the rest of us. It is true that they and some n% would have to settle for a smaller % but if we use our democracy to fairly provide for our needs, business owners can still do fine within the higher wage structure.
Our economy is captured by the rich; our government does not respond to the needs of its citizens. That is by design (not ours, for sure) and not because of some neo-liberal economic truths. On the Democratic Underground, we need to be reminded that democratic economy can and should work for as many of us as possible. I am calling out the “wages can’t rise” argumement for what it is: neo-liberal superstition.
How do you suppose the Democratic Party can inspire votes by clutching its pearls about offending the wage gods? It is simply not true that we can’t have a better system; kowtowing to the status quo and “experts” will fail us.

[Delphinus]

14. Thanks for saying this

and welcome (belatedly) to DU!

[Kid Berwyn]

15. Mitch made millions while the Free Press broke the strike with scabs.

Just saying. His brand of economics.