Minimum Wage Would Be $22 An Hour If It Had Kept Up With Productivity(huffingtonpost.com)

6 pointsby orofinovor 13 Jahren5 comments

Minimum Wage Would Be $22 An Hour If It Had Kept Up With Productivity

http://www.huffingtonpost.com/2013/03/18/elizabeth-warren-minimum-wage_n_2900984.html

3 comments

orofinovor 13 Jahren

Personally, I think relating this to productivity is a flawed benchmark, though it is interesting to think about. The idea of tying it to the rate of increase for top executives (the 1%) is also specious. It would make more sense to tie increases to inflation, which we have not done[1].

Ultimately, minimum wage should be set so that an individual receiving it would be above the poverty line, otherwise, what the hell is the point? So for 2012 we should be around $11/hr. If you want to argue that you should pay your people so little that they'd be in poverty, then you should find a different country.

[1]: http://www.raisetheminimumwage.com/facts/entry/amount-with-i...

jejones3141vor 13 Jahren

Minimum wage laws price low-skilled people out of the job market; <sarcasm>I'm sure they appreciate that</sarcasm>. According to the Bureau of Labor Statistics (http://www.bls.gov/cps/minwage2011.htm, the latest I could find), those making at or below the minimum wage (that includes restaurant servers, who also earn money from tips) are only 5.2 percent of those who work for hourly wages. Their median age is 25; how many of them still live at home with their parents?

paulhauggisvor 13 Jahren

The cost of living would also be much higher if minimum wage was $22/hour. A raise in minimum wage does not equal a raise in minimum spending power.

Many businesses will also cut some of their jobs because they just can't pay a minimum wage that is that high (but the job might be available if it was lower).

You might have an increase in spending power for the short time that it takes for the economy to catch up.

Look at Denmark or Sweden. Minimum wage is high, but it also costs almost $10 to buy coffee at 7-11.

anigbrowlvor 13 Jahren

Coffe and a piece of sweet food at 7-11 in Sweden is $4-5. I'm going from the menu in this photo taken in January: http://www.fastcodesign.com/1671683/rebranding-7-eleven-with... That's about double the US price but rather less than the $10 you suggested. I would guess the coffee alone is about $3.

orofinovor 13 Jahren

I don't think the goal or desire was to raise it to $22/hr, but merely provide some illustrations (certainly flawed) about how inadequate the minimum wage is today. It is certainly true that with increases we would see a decrease in the purchasing power of the dollar. I'd love to read something from an economist on this, I certainly don't know what the exact answer is.