Minimum Wage

Where i live we do have minimum wages.

We have people that live on unemployment aid and we have thousands of vacancies that cannot be filled because there are not enough candidates that want to do the available jobs.

Minimum wages have only a small impact for several reasons:

the minimum wages are just high enough to protect the weaker against slavery and poverty

as the difference between the minimum wages and what would be paid otherwise is not huge the only calculation that is made is: do we make profit if we engage people or not?
If there would be profit you have two options:
first you can say: i'm against minimum wages so i will not hire anyone and prefer not making money.
secondly you can say: i'll engage people because otherwise someone else will take over the production i miss including the profits.

As everyone has the same "disadvantage" of minimum wages, the effect is neutralized because everyone has to pay the same "excess" in salaries for this group of people.

We have different minimum wages depending on the sector of employment. The lowest possible wage for a person at the age of 21 years is 1210 euro a month (approx 1550 $). At the age of 22 it becomes 1258 euro ( approx 1600$). Most of us get 13 months paid plus paid holidays. So for most it is 13.90 time a month's salary.
 
Quote from GTS:

Its difficult to rebutt such a statement without knowing

(1) What is the definition of "modest"
...
I'm sure that its possible that modest increases would have little effect on employement but the question is how modest is modest - how far can you push the level before a significiant affect is caused. Have those 552 economists reached a consensus on that?
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I am quite sure it's based on previous "modest" minimum wage increases of $0.5 - $1 which had no adverse effect on employment and job market. The article is actually quite explicite about it:

we believe the Fair Minimum Wage Act of 2004’s proposed phased-in increase in the federal minimum wage to $7.00 falls well within the range of options where the benefits to the labor market, workers, and the overall economy would be positive.
http://www.epinet.org/stmt/economistsminwage200410web.pdf
 
Quote from ElectricSavant:

Has the minimum wage ever been lowered?
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Yes, it has not been raised for 10 years, for all intents and purposes due to inflation it's worth half of what it was in 1996.
 
One issue that has not been addressed is regional differences. The (expensive) cost of living in some areas make the national minimum wage a joke. Where I live even WalMart pays more than minimum wage.
 
Well,

Imagine an environment resembling egalitarianism?

Would you be motivated, when you did not realize the fruits of your labor?

Our tax system has created the most charitable individuals in the world.

Michael B.

P.S. I am qualified to speak on this matter, because I lived and worked in Socialism. The USA is a lot better than the suppression felt in other countries. If you have lived under two systems then please comment, otherwise you are just not qualified.

Quote from 1contract:

I can never really understand why people get so worked up about this. The real abuses are at the other end of the wage scale.
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Some are making assumptions that have little practical value. Studies show that the overwhelming majority of minimum wage employees either do not head households (students ect.) or are seniors supplementing retirement income. Bumping the 16 yo working behind the soda fountain in the Fashion Plaza is not of paramount moral concern. Also a higher MW will most certainly swell the number of illegal immigrants who work many MW jobs.

We should all be sensitive to the plight of those raising families at or near the poverty level. However the reality is most "working poor" are already making more than the MW. (jobs in the $7-$10.00 per hour zone). For many poor it's not so much about wages as it is about other factors like available time that make economic survival difficult. Try being a single mom raising a couple of toddlers and still be able to put in a 40 hour week. Or try commuting two hours each way by bus to a lower wage job.

The goal of society should be rooted in justice and solutions. Empty symbolism is pointless. We must deal with a wide strata such as developing transportation networks that help folks commute from affordable neighborhoods to jobs in outlying areas, enabling mom's with innovative child care options, free alcohol and substance abuse help, and job training/networking programs. However those institutional changes require wholesale commitment. I guess it's easier to just say "raise MW by a buck and call it a day."
 
Quote from ElectricSavant:

Well,

Imagine an environment resembling egalitarianism?
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I'm talking about a minimum wage - not the same wage for everybody.

Sure, it may be a imperfection in your free market - but a pretty minor one. I just don't see it as very significant.
 
Quote from dddooo:

Yes, it has not been raised for 10 years, for all intents and purposes due to inflation it's worth half of what it was in 1996.
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That's a good statement, and one that provokes some thought.

Where I live the current minimum wage is not really binding. There are very few jobs that pay minimum wage without some form of additional incentive. And I live in a college town in a state that has very low pay compared to the rest of the nation. We are currently close to full employment. In fact, employers wanting the better workers are actually hiring temps at $9/hr which is significantly higher than minimum. Is this a result of the minimum not increasing (falling behind inflation). That's why I think few employers would drop below 5.15 if given the option. If we leave the required minimum untouched for a decade the competetive wage will pass the minimum required or at least get very close to it.
 
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