Why is raising the minimum wage uncompetitive?

[Kokonoe]

If, it's a federal law would not all businesses be under the same law? Would it only hurt uncompetitive companies?

[lostnotforgotten]

1. The Business Bottom Line Would Suffer Initially and The Greedy

Republicans could not let that happen - ever!

[sweetheart]

2. 15 dollars an hour minimum for everyone on earth!

its time for a living wage.

[Deja Q]

11. No.

We need $15/hr in America.

Considering how India and China have been booming, it sounds like $2/hr is a proverbial Fort Knox to each individual worker.

[dogman]

3. Workers would not have to work for less.

They would not compete with each other to do a job for less. Employers would have to think instead of just beat down the workers to come up with a profit. Areas with a higher minimum wage historically have a better local economy. It is difficult to compete with products from slave wage countries. To compete with them would require the elimination of the middle class. We see that happening every day. The solution to that problem is what was promised in the lead up to trade agreements but never delivered, worker and environmental protections. That would require thinking on the part of government.

[Big Sky Boy]

4. The textbook argument

Forcing businesses to raise the amount they pay entry level employees obviously increases costs. Conventional wisdom is that the added cost would discourage employers from hiring as many people as they would like--forcing them to be less productive (read also less competitive) with fewer resources.

True free market capitalists oppose any form of minimum wage, preferring instead to believe that market forces will drive wages to their appropriate level.

The argument on the other side is obviously that if workers have a real living wage, they will have greater spending power and all businesses will benefit by the added stimulus to the economy.

[Warren Stupidity]

10. The problem with the textbook eco 101 argument

is that when you go out in the real world and try to validate the theory, there is no data that supports the claim that raising the minimum wage by reasonable amounts causes an equivalent depression in economic activity.

[barb162]

5. It's not uncompetitive

That's a big lie created by business. Face it, they just raise prices when their costs go up, whether it's electricity, wages, rent, etc.

[Warren Stupidity]

6. It is not and there is no evidence that it is.

Reasonable (for example cola) increases in the minimum wage do not depress economic activity.

Oh and I agree with the other post here that we need a global minimum wage so that the 400 elite families can't just go around the planet searching for the cheapest backs to rent.

[dubykc]

8. Agreed, on both points!!

[On the Road]

7. It's Uncompetitive

in cases where factory workers produce products which compete against imports. A high dollar and advances in transportation and communication have escalated the process, but the principle has been around forever. America gave up on shoe manufacturing decades ago because Italian factory workers made less and were more productive than American workers. Now it's Asian workers who undercut American factory workers.

Having said that, I don't know many factory workers are working for minimum wage. So the effect may not be noticeable.

The process of being uncompetitive isn't all bad. Successful countries do well to offshore their lowest-paying and least productive jobs as long as unemployment stays low. Otherwise there will be labor shortages. The problem is that the US hasn't managed that process, has opened it up way too fast, and has done less than nothing to control deteriorating wages for unskilled and semi-skilled workers.

[TahitiNut]

9. Unemployment is highest in states with lowest minimum wage.

The minimum wage in Washington is $7.63/hr. The Sept unemployment rate is 5.4%.
The minimum wage in Oregon is $7.50/hr. The Sept unemployment rate is 4.8%.
The minimum wage in Illinois is $6.50/hr. The Sept unemployment rate is 4.4%.

The minimum wage in Michigan is (the federal rate of) $5.15/hr. The Sept unemployment rate is 7.1%.

The word "competitive" means lower compensation for human labor through a "free market" - essentially treating labor as a commodity. But treating human labor as a commodity is both illegal and immoral.

[CatholicEdHead]

12. If workers are not paid much, then more money can be used

for other things, helping you put the competitors out of business. Of course it usually means the bosses make out like bandits.