$15 min. wage would cut 1.4M jobs in the US

[bionic 50,111]

Lets continue to prop up failing businesses on the poverty of their employees  

[Economy 52,838]

54 minutes ago, FATCAT said:

not only that, but if a job requires you to make less than a livable wage for your work, you're being exploited. Jobs like that shouldn't exist.

Another factor too to consider is that if a business cant afford to pay u more than $10/h without going bankrupt then its probably not a very good competitive business to keep alive to begin with

 

Zombie companies with low productivity use up labor that can be more productive else where

 

It may sound heartless to business owner or whoever looses their job in the moment but in the long term everyone benefits when uncompetitive businesses get cleaned out once in a while including ppl who loose their jobs and get a higher paying one later

 

Thats one positive of mild recessions actually and why some economisra are against ecessive help or stimulus during economic downturns (especially if they arent very severe ones like 2008 or the 2020 pandemic recession) because they do wipe out uncompetitive businesses that are weighing the economy down from its full potential and allows more competitive and productive companies to grow in thier place

 

Think of it like a forest full of dead trees taking up space and soil. A forest fire once in a whilw clears out the dead stuff and allows new plant life to flourish in its place

[Economy 52,838]

5 minutes ago, bionic said:

Lets continue to prop up failing businesses on the poverty of their employees  

Literally this which i just commented above ^^^^^^^

 

If a business cant afford more than $7.25/h without going bankrupt then that business is just too unproductive to justify trying to keep alive. Its not really an asset to the economy

 

U dont wanna create jobs for the sake of creating jobs. Thats not what creates a vibrant and prosperous economy. Those jobs have to be productive

 

If jobs for the sake of jobs meant good economy, all countries with lower unemployment would be better economically but as we see thats clearly not the only factor

[Chromatican 4,046]

9 minutes ago, Economy said:

Only 5% of US labor force has more than 1 job tho. I dont know that this would be the massive factor tho it would certainly have some impact

5% is still millions of people working multiple jobs.

[Economy 52,838]

36 minutes ago, Chromatican said:

5% is still millions of people working multiple jobs.

Of course it is. But im saying i dont think that would fully account for what Fatcat was saying. 

 

Also its basically implying that the job losses would all be a result of ppl with 2 jobs quitting. I think they would be a lot more random than that and given 95% of ppl dont have 2 jobs, most axed or lost jobs would probably be unvoluntary not voluntary

 

Thats my point

 

Not to mention if ppl quit cuz they didnt need the 2nd job but the company still wanted it filled theyd hire someone else so the job wouldnt be lost. On the flip side if a company wanted to cost cut theyd get rid of the position regardless of whether u have 1 job or 2

 

So i dont see it being a major factor

 

PS: to be clear tho im not against the hike. I do think it needs to go up. But i think some of its impacts are oversimplifyed by some

[MJHolland 12,725]

3 hours ago, FATCAT said:

A lot of this is because people with 2 jobs will be able to just have 1, as their single-job wage increases. 

None of this employment loss would be created by what you described, as Economy pointed out. The CBO doesn't consider changes in frictional unemployment (i.e. unemployment caused by someone quitting and the company looking to replace them). These would be actual real jobs that no longer exist.  

 

2 hours ago, Economy said:

Prices did go up so it kinda felt like the middle class subsidizing the low incomes

Well, I just wanted to point out that regardless of the minimum wage, the rest of the economy (middle income and above) do subsidized low-income workers via government welfare. Particularly true for min wage workers in the U.S. since they earn well below the poverty line. 

Prices increasing because of a minimum wage increase could be seen as a similar "subsidy", but it would be a lot more beneficial the the large economy to do it this way. You'd expect prices to go up mostly on consumer goods like food and clothing, which the upper class does still need to buy, too. 

I'm a bit surprised you said consumption didn't go up, though. Especially since wage increases for low income people you'd expect to mostly be spent right away since they save money at a much lower rate. 

 

[Economy 52,838]

17 minutes ago, MJHolland said:

None of this employment loss would be created by what you described, as Economy pointed out. The CBO doesn't consider changes in frictional unemployment (i.e. unemployment caused by someone quitting and the company looking to replace them). These would be actual real jobs that no longer exist.  

 

Well, I just wanted to point out that regardless of the minimum wage, the rest of the economy (middle income and above) do subsidized low-income workers via government welfare. Particularly true for min wage workers in the U.S. since they earn well below the poverty line. 

Prices increasing because of a minimum wage increase could be seen as a similar "subsidy", but it would be a lot more beneficial the the large economy to do it this way. You'd expect prices to go up mostly on consumer goods like food and clothing, which the upper class does still need to buy, too. 

I'm a bit surprised you said consumption didn't go up, though. Especially since wage increases for low income people you'd expect to mostly be spent right away since they save money at a much lower rate. 

 

I dont have exact numbers to give u and statistics as far as i know were never made available to break down exact changes in consumer spending amounts by income brackets before and after minimun wage hike

 

What i do know is the general GDP growth trend stayed roughly the same... jobs in service sector did take an innitial hit but very quickly were gained back (i guess any business that cut bacn did it all at once when it first took effect, i still remember January and February the losses happened then by March job growth trends resumed)

 

But since prices did go up on some stuff... what i suspect happened is that middle classes purchasing power dropped slightly (most ppl making $18/h like i was at the time did not get raises when minimum wage went up like some kind if trickle up effect so we payed those higher prices on flat wages) while minimum wage earners gained an equivalent amount (since their wage hikes were still higher than the inflation)...

 

So consumption would have gone up among low income earners but overall across the board consumptiom stayed roughly neutral because middle class consumption dropped by a simmilar amount. So again middle class subsidizing the poor, but the total amount not increasing (per capita, it did increase a bit but it always does regardless every year cuz we have rapid population growth)

 

Again tho, im going off of overall consumer spending reports and GDP trends of the time. The stats did not break it down in that much detail by grouo so i cant know for sure that this is the reason that consumer spending trends were mostly non-affected by the big minimum wage hike and as usual theres always a lot of other factors and forces going on as well in economy as well simultaneously

 

But minimum wage hikes are not like taxes on the rich themselves, they are on businesses which can pass it on to consumers and they usually do... and since they usually do, i dont find it surprising that in many instances the overall consumption and consumer purchasing power doesnt change much

 

The amount may shift by income levels but not so much totality