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When Amazon Raises Its Minimum Wage, Local Companies Follow Suit (myheraldreview.com) 140

Posted by EditorDavid from the minimum-viable-payments dept.
In the areas where Amazon operates, "low-wage workers at other businesses have seen significant wage growth since 2018..." reports the New York Times, "and not because of new minimum-wage laws." The gains are a direct result of Amazon's corporate decision to increase starting pay to $15 an hour three years ago, which appears to have lifted pay for low-wage workers in other local companies as well, according to new research from economists at the University of California, Berkeley, and Brandeis University... [T]he research illustrates how difficult it can be for low-wage workers to command higher pay in the modern American economy — until a powerful outside actor, like a large employer or a government, intervenes.

Most directly, there is little evidence in the paper that raising the minimum wage would lead to significant job loss, even in low-cost rural areas, a finding consistent with several recent studies. Other research, including a recent report from the Congressional Budget Office, has found a larger negative effect on jobs, although still smaller than many economists believed in the past.

The authors of the latest study — Ellora Derenoncourt of Berkeley and Clemens Noelke and David Weil of Brandeis — studied Amazon, Walmart and Target, which operate in areas where wages tend to be low. But even in those places, the researchers found, wage increases by the large corporate employers appear to drive up wages without driving down employment. "When you have major changes in the wage policies of large actors in the labor market, this has ripple effects," Dr. Derenoncourt said in an interview.

At the same time, Dr. Weil added, "the sky doesn't fall."
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When Amazon Raises Its Minimum Wage, Local Companies Follow Suit More

When Amazon Raises Its Minimum Wage, Local Companies Follow Suit

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  • Well, duh! (Score:5, Interesting)

    by CrimsonAvenger ( 580665 ) on Sunday March 07, 2021 @07:44AM (#61132596)

    Of course they do.

    If the other companies didn't raise minimum wage to match Amazon, then everyone would be going to Amazon looking for work, and noone would even think of looking elsewhere.

    Caveats: people who are barely employable at the best of times may not be able to find work at Amazon, and so might have to settle for lower wages. Likewise people who think of Amazon as evil (certainly there are enough /.'ers who think that, so I'll assume that some "normal" people everywhere agree....

    But, by and large, the effective minimum wage anywhere is going to be the minimum wage of the largest single employer in the area....

    • Indirectly speaks to the non-mobility of the workforce, otherwise the effect would be more widespread. Like ripples in a pond.

    • This is certainly the case in areas with tight labor markets.

    • But the number of jobs at Amazon won't increase until all low skill workers are employed by them. You would only see that effect if Amazon was such a large employer that almost everyone works there.

      If Amazon employs 10% of the low skill workers, the other businesses would at most lose the top 10% of employees and the other 90% would have to fight for jobs at the lower wages. That means it appears to make sense to keep wages low. But they raise wages anyway. So this has probably more psychological reasons, a

      • Even in the case of low wage jobs, not all workers are equal. The employer that has the highest wage also effectively gets their pick of workers. Even if they won't employ more than a small minority of total labor, if the wage difference is large enough, they will likely wind up with the better workers on average. Even if it seems like a small amount, a $1 increase in pay is a 10% raise if you were only earning $10 previously.

        Similarly if a company is at risk of losing their best workers to some other em

        • An aspect of this that I do not see in any of the comments here is that workers are not (just) employer resources, but are people also, and that all employers need their workforce to be content (if not actually happy) in their jobs. Amazon establishes a benchmark wage for the area, and everyone will know people who work at Amazon, and how much they get paid. It is not just "they will lose the best workers" if they do not pay the equivalent, it is that all of the workers they do have will be unhappy with the

        • they will likely wind up with the better workers on average.

          Sure, but how important is this for minimum wage workers? If the employees are producing significantly more output than the average they would probably be able to move to a higher paying job anyway. Will you lose someone important to the bottom line, if your two best cleaning staff goes to Amazon?

          Also, as I mentioned in my previous post, this effect of losing the top performers won't be noticed until Amazon or other high payers are a big share of the total pool.

          Of course if 90% of employers pay a higher wag

    • Re: (Score:2, Offtopic)

      by Ol Olsoc ( 1175323 )

      Of course they do.

      But, by and large, the effective minimum wage anywhere is going to be the minimum wage of the largest single employer in the area....

      Which is why making certain the wealthiest become more wealthy through elimination of taxation and any impediments to their wealth accumulation makes all of us wealthy. The tide lifts all boats!

      • Re: (Score:3)

        by AmiMoJo ( 196126 )

        We did try that for... 50 years now? And it hasn't worked. Mostly because the wealthy don't take take cuts as an opportunity to increase worker's wages, they just pocket the cash themselves.

        The market sets wages, not the generosity of employers.

        • We did try that for... 50 years now? And it hasn't worked. Mostly because the wealthy don't take take cuts as an opportunity to increase worker's wages, they just pocket the cash themselves.

          The market sets wages, not the generosity of employers.

          Oh god, I guess that it's impossible to go too far over the top with well proven fallacies. Sorry for poeing you!

          Yes, having a few people becoming richer than some countries Gross national product is not helping people at the bottom. I question if it has any positive effect on even the 10 percenters.

          For instance, Jeff Bezos would be the 57th highest GDP in the world if he were a country. https://en.wikipedia.org/wiki/... [wikipedia.org] And yeah, there are different measurements.

          • For instance, Jeff Bezos would be the 57th highest GDP in the world if he were a country

            It's a flashy number, but you shouldn't take it seriously. Comparing annual revenue to total net worth is not a useful way to look at things (unless you are trying for humor).

            • For instance, Jeff Bezos would be the 57th highest GDP in the world if he were a country

              It's a flashy number, but you shouldn't take it seriously. Comparing annual revenue to total net worth is not a useful way to look at things (unless you are trying for humor).

              Just a matter of comparison. Bezo's might buy one of those countries soon.

          • Re: (Score:2)

            by dryeo ( 100693 )

            It has helped the 10 percenters as they have the capital to invest in the stock market, property market etc and realize 10% returns on their investments unlike the 90%.
            It is one of the reasons for K type recoveries since at least 2008 and especially during the pandemic. It's not the Amazon workers or grocery workers who are sitting on large cash reserves and playing the stock market, upgrading their home or gambling on bitcoin.

            • It has helped the 10 percenters as they have the capital to invest in the stock market, property market etc and realize 10% returns on their investments unlike the 90%.

              What happens however is that when those who finish extracting every cent they can from the bottom 89 percent, they'll move upward to feed on the next group. Banana republicanism at work. Greed, which is the base of such wild accumulation, having been enabled, won't stop unless stopped.

              Now that really isn't likely to happen, as there will be a tipping point. When almost no one holds almost every piaster, things tend go get a little rough.

              It is one of the reasons for K type recoveries since at least 2008 and especially during the pandemic. It's not the Amazon workers or grocery workers who are sitting on large cash reserves and playing the stock market, upgrading their home or gambling on bitcoin.

              You're correct. I've done okay during all the recent recessions, but

    • "If the other companies didn't raise minimum wage to match Amazon, then everyone would be going to Amazon looking for work, and noone would even think of looking elsewhere. "

      You'll get the morons that aren't even able to read an address.

    • I noticed Chick-Fil-A near me doing the same thing a couple of years ago in Beaverton, OR. We already have a very robust minimum wage law, was $12/hr back then, Chick-Fil-A was offering $16.25/hr. Now fast food around here is paying $18/hr, when minimum wage is $14.00/hr.

  • We have a non-Amazon marine/boating wholesale outfit that also pays $15 per hour. They are having difficulty hiring seasonal workers now with the combination of generous state unemployment benefits supplemented with the $300/week special COVID benefits. The "freebies" come too close to what one could make (minus tax and SS withholding) working at $15 per hour.

  • But the sky is falling... (Score:5, Insightful)

    by Pollux ( 102520 ) <speter@tedata[ ]t.eg ['.ne' in gap]> on Sunday March 07, 2021 @07:48AM (#61132600) Journal

    At the same time, Dr. Weil added, "the sky doesn't fall."

    I wouldn't be so certain of that.

    While Amazon is raising rates to $15 / hour, they're also growing warehouse automation at an unprecedented rate. With each passing year, Amazon's ratio of output to hourly employees continues to grow. In other words, they're getting more work done with less humans to do it due to automation.

    What their $15 / hour initiative is really doing is making it much more challenging for their competition to survive, competition that's much more dependent on human labor. Amazon raising its salaries forces competitors to raise theirs, causing competitors to take a much bigger hit to their bottom line, forcing some of them out of business.

    In the end, as more people buy Amazon due to its lower prices, and more main street businesses close shop, we'll have a significant net loss of the labor pool. It's a pernicious cycle slowly destroying our economy, all because the everyday consumer only cares about saving a couple bucks.

    • Re: (Score:3)

      by Entrope ( 68843 )

      TFA suggests that Amazon recognizes how they benefit from that dynamic:

      But he rejected suggestions that Amazon is using its political power to hurt its rivals. âoeWe have no power to force anybody to do this, only Congress does,â he said.

      They cannot "force" other companies to commit economic suicide. Only Congress or Adam Smith's invisible hand can do that!

    • To paraphrase: Pay high, spend low. Even if people are paid more, that doesn't mean they're going to lose their thrifty ways (much like people coming out of a depression). One could argue people with more money should spend more, be it quantity, or quality, but people are irrational and short-sighted actors. Plus we've already seen apathy in, your problems aren't our concern...till it's too late. Then we'll huff our way over to YT for a trip down nostalgia lane for all the things we lost and never gain back

    • Re:But the sky is falling... (Score:5, Interesting)

      by serviscope_minor ( 664417 ) on Sunday March 07, 2021 @08:32AM (#61132696) Journal

      In the end, as more people buy Amazon due to its lower prices

      Amazon certainly has a reputation for low prices, sure. I don't know how it is in the US but in the UK, the prices aren't actually. Sometimes they are on some genuine products. Sometimes they are because they sell "equivalents" which are actually blatantly illegal unsafe imports cheaper than things which adhere to the local safety laws. On others they're middle of the road or even high. I think they have a very good marketing department however and now people just assume they're getting a bargain without checking.

      • I typically look at Amazon and eBay at the same time for the same items and Amazon regularly has them cheaper. Almost never can I find the same items cheaper anywhere else; rarely I find them slightly cheaper on Aliexpress, DealExtreme or BangGood, but I don't really want to deal with those sites. If the difference is small I will generally pay a few bucks more to get an item from eBay rather than Amazon. Amazon processes returns and the like faster than eBay, since you only have to deal with Amazon and not

      • over the last few months, I've been watching more closely.

        For household goods, amazon is the same as Walmart about 10% of the time, and *higher* than Walmart the other 90%.

        And Walmart delivers faster, without the annual fee.

        Yesterday, a couple of items I ordered at 9:11 AM were delivered at 11:31 AM (two day delivery, but the local store had them).

        Putting on the Econ professor hat . . . always watch for the *other* effects. Sometimes its in the same direction, and sometimes in the opposite direction.

        Here,

        • Re: (Score:2)

          by dryeo ( 100693 )

          Another datum: several years ago, a study found that Walmart coming to town did indeed reduce local wages and prices. But even if you accepted the union value (which was overstated) for the amount wages went down, the drop was *significantly* less than the same workers saved in a lower cost of goods.

          What about other necessities such as housing? In the town I'm in, housing has been going up up to 10% a year since Walmart came to town and now you're lucky to find a house for less then a million, which has also resulted in rentals being torn down and now the local government coming down on illegal suites, leading to a 0.1% vacancy rate as well as sky rocketing rents.
          The Walmart, along with a couple of other big stores made the area much more appealing to live in.

    • Whenever there's an Automation thread on /. everyone says "Don't worry, there'll always be more jobs". But whenever there's talk of raising wages it's "can't do that, they'll automate all our jobs away!".

      Here's the truth: Companies will automate everything they can, even if you grant them literal slaves. That's because machines are a) always cheaper in the long run and b) so much less trouble. They don't complain, don't file OSHA or sexual harassment claims, don't demand better benefits and don't need c

      • Re: (Score:2)

        by sjames ( 1099 )

        Exactly. People thinking otherwise should consider that even McDonalds (the origin of the term McJob) is looking to automate cashiers and burger flippers.

      • Re: (Score:2)

        by g01d4 ( 888748 )

        the tech doesn't yet exist to do it at a high enough rate of reliability

        I think the tech exists for a lot of white collar jobs and it's mostly corporate inertia that maintains the status quo. Outsourcing to to typically tech savvy companies might be a form of job reducing automation.

    • At the same time, Dr. Weil added, "the sky doesn't fall."

      I wouldn't be so certain of that.

      While Amazon is raising rates to $15 / hour, they're also growing warehouse automation at an unprecedented rate. With each passing year, Amazon's ratio of output to hourly employees continues to grow. In other words, they're getting more work done with less humans to do it due to automation.

      What their $15 / hour initiative is really doing is making it much more challenging for their competition to survive, competition that's much more dependent on human labor. Amazon raising its salaries forces competitors to raise theirs, causing competitors to take a much bigger hit to their bottom line, forcing some of them out of business.

      In the end, as more people buy Amazon due to its lower prices, and more main street businesses close shop, we'll have a significant net loss of the labor pool. It's a pernicious cycle slowly destroying our economy, all because the everyday consumer only cares about saving a couple bucks.

      That seems a touch Machiavellian, even for Amazon.

      More likely Amazon is raising wages because they can afford to, and with their per-employee productivity it really does make sense to get the top-tier of unskilled labourers. Plus, they're conscious of the political & PR benefits of paying $15.

      Still, it's unlikely that Amazon is draining the local labour pool entirely. Sure employers need to pay more to keep their top people but if it's raising wages across the board that sounds more like social norms ar

    • Re: (Score:2)

      by narcc ( 412956 )

      Your model assumes spherical cows in a vacuum.

  • It's basic economics (Score:4, Informative)

    by Whateverthisis ( 7004192 ) on Sunday March 07, 2021 @07:56AM (#61132620)
    It's just basic economics. Labor is a market, as much as many would like us to believe it isn't, or it's a right, or whatever; every issue with labor can be defined in and solved with market enforcing techniques.

    Raising minimum wage changes the decision matrix of an employer. An employer needs something done; they either hire a worker to do so, they find a machine to automate it, or they don't hire a person and suffer the consequences (go out of business for example). The key though is you have to put numbers on that. In jobs where automation is very cheap, like say a data entry style job where in certain cases basic sensors can do the job much faster and cheaper, a minimum wage raise will put more sensors into play and you lose more jobs.

    But automation isn't exactly cheap, and it's rarely universal in that it can completely replace a worker; rather it shifts some of the worker's tasks to a robot and the worker has other tasks. The development and adoption and retraining of staff to utilize automated capabilities successfully can be quite expensive, and in some cases it's just easier to raise pay. Particularly when a large corporation like Amazon 1) has the resources to effectively introduce automation and 2) is by and large the largest purchaser of labor in a given region, and 3) chooses not to automate and instead pays higher wages for those jobs, you can logically deduce that for those roles labor is the cheaper option and the demand is thus higher, resulting in a raising of the price of labor ie wages.

    But a market manipulation via the government changing minimum wage laws doesn't have those factors to use as signals as to when a given role is better as labor vs. automation, so you can't say equivocally that "raising minimum wage" results in fewer job losses. When the government does it, the application might just as easily happen in a segment where the automation is cheaper and result in higher job loss than when Amazon does it, because Amazon is participating in the market and has the market signals to guide behavior whereas government regulation has no such signals to understand how this can be applied effectively.

    That's a typical long winded answer from me: summary is you can't take Amazon's experience and apply it broadly to "raising minimum wage". Labor is a regional market with many variables depending on the role and level of skill ie substitutes in market terms. It's different when a government regulates something which is often without the factors affecting a market vs. when a market actor comes in and acts within the market forces.

  • That paper shows significant job loss! (Score:5, Interesting)

    by Entrope ( 68843 ) on Sunday March 07, 2021 @07:59AM (#61132628) Homepage

    The NYT:

    Most directly, there is little evidence in the paper that raising the minimum wage would lead to significant job loss

    Their own description of the research's findings:

    A 10% increase in the base wage at a company like Amazon, they found, translated into a 1.7% loss in local jobs -- and a 0.4% loss in jobs for low-wage workers.

    Unless the Amazon-like company employs much more than 20% of workers in the area, those job losses are pretty large compared to the salary increase. You'd need something like 60% of workers to be working for the megacorp before I called that not "significant" -- but a lost job will always be significant to the person in question.

    • The point of the article, is that the other companies raise their wages too. So it does not matter how many of them work at Amazon.

      For the low-wage workers collectively, a 10% increase in wages for a 0.4% job loss is a no brainer absolutely worth it. The increased wages would pay for the cost of giving 100% unemployment to the 0.4% who lost their jobs with a 20x ROI to the people who kept their jobs.

      If your wage was raised from $10 to $11 you would have to pay 4 cents of that extra dollar to cover the guys

      • Re: (Score:2)

        by Entrope ( 68843 )

        The article goes out of its way to avoid mentioning how much wages go up for workers at competing firms -- they surely would have mentioned that if wages for all low-wage workers went up 10%.

        You ignore the overall 1.7% job losses, mostly from higher-wage workers. Because only 0.4% of low-wage workers lose their jobs, that means most of the job losses are higher-paid jobs, and your 4 cent example is absolutely wrong. It would be at least 17 cents, most likely a lot more. 30 cents? 50 cents? Once you fac

        • The 4 cents apply to the low wage collective. Of course the 1.7% skews the numbers for the whole worker collective.

          There will surely be practical effects in reality that does not match a pure theoretical example, like administration of unemployment and such.

          But even if it is 50 cents instead of 4 cents, that is still a 50 cent raise for the entire low wage collective. They would have to pay that whole dollar to unemployment fees before this is a bad deal for the workers.

          If none of those safety nets exist, t

          • Re: (Score:2)

            by Entrope ( 68843 )

            There is no "lower wage collective". Also, you are continuing to pretend that wage increases come from nowhere, among a host of other flaws in your story based on imaginary numbers.

            • There is no "lower wage collective".

              Collective is just a group of people. They are a group of people.

              Also, you are continuing to pretend that wage increases come from nowhere, among a host of other flaws in your story based on imaginary numbers.

              Where did you get that idea? I have never mentioned any such thing. Obviously the money comes from the company, and by extension the owners and/or the customers, depending on the specific situation of the company.

              The numbers are not imaginary. The wage increase moves money from the company to the workers. And the workers as a total get more money. How that is distributed among the workers is another question. Like I said before, it could mean

    • Re: (Score:2)

      by Cyberax ( 705495 )
      So a 50% wage increase would result in 2% job loss for low-wage workers? That's actually a pretty good trade-off.

      • Re: (Score:2)

        by Entrope ( 68843 )

        No. Do you also believe that raising everyone's wages by 1000% would be a good trade-off, perhaps because it pays for itself through increased tax revenues?

        • Re: (Score:3)

          by Cyberax ( 705495 )
          Actually, if you do the math then the inflection point for the min wage is somewhere around $30 per hour. After that point the increases will simply raise the prices accordingly.

          $25 per hour also happens to be a minimum wage in Switzerland.
    • raising the minimum wage doesn't make 1.7% of your economy go away. There are some short term losses as businesses that were on the edge or only profitable because of extremely low wages go under. Unemployment insurance can take care of that.

      And a wise man once said: "[N]o business which depends for existence on paying less than living wages to its workers has any right to continue in this country.” [thebillfold.com]

    • Re: (Score:2)

      by AmiMoJo ( 196126 )

      What are these jobs being lost though? If they are just part time or gig economy, only used to supplement wages from a main job, then their loss could simply be a person with two jobs deciding that they would rather have that time for themselves now that the minimum wage covers their bills.

      In any case many countries have found that when the minimum wage increases so does employment. People have more money to spend, people with two jobs can give one up and let someone else have it etc.

      Extremely low wages for

  • The "modern" American economy (Score:5, Insightful)

    by Rosco P. Coltrane ( 209368 ) on Sunday March 07, 2021 @08:02AM (#61132634)

    What a fucking joke. The American economy has always been semi feudal, and has steadfastedly stayed so while European countries were busy enacting social improvements across the board during the second half of the past century. Now with the new wage slavery from the "gig economy" and monopolistic powerhouses like Amazon, it's even slipping back to pre-war levels.

    Modern alright...

    • Strange to hear someone from Europe call Americans wage slaves when European median disposable income [wikipedia.org]

      is so significantly lower. While the lowest income earner may earn less in America, the vast majority of Americans earn significantly more than their European counterparts. All these wonderful "social improvements" didn't come free, you've paid for them with low income, high unemployment, and slower economic growth.

      • Re: (Score:3)

        by radaos ( 540979 )
        From Wikipedia: "Wage slavery is a term describing a situation in which a person's livelihood depends on wages or a salary, especially when the dependence is total and immediate" It is not equivalent to income, but rather the lack of any safety net, whether socially provided or otherwise. Living in a McMansion, but only a paycheck or two away from homelessness? You're a wage slave.

        • Living in a McMansion, but only a paycheck or two away from homelessness? You're a wage slave.

          There is a fix for that, sell your "McMansion" (dunno where the fuck this comes from) buy something else that is more within your means, and you have more disposable income. There, you're no longer a "wage slave". You don't necessarily have to start from a mansion either; As a near universal rule, it's always possible to lower your cost of living. You might just find that if you even moved somewhere else with a lower cost of living, you could even increase your quality of life (say having a bigger house or

      • What good is higher income if you have to pay it for college, healthcare and retirement? When you have 2 weeks of vacation? When your boss can fire you on the spot with for no reason? That what matters more for not feeling like a slave than having 15% higher income per capita or whatever.

        • Actually he was talking about disposable income, which comes after all of that is considered.

          This mainly comes down to cultural differences that aren't likely to change any time soon -- the US is more individualistic, whereas Europe is more collectivist. That is to say, in Europe, who you are and what you do is everyone's responsibility. In the US, you're more responsible for yourself. With the former, you don't really get anywhere in life unless the political climate permits it, but hey, at least you have

          • Oh, and also, dunno about you, but my job gives me roughly 35 days of paid time off per year. If you broke that down into weeks, that would be about 7 weeks of paid time off per year.

    • Feudal? You've got to be kidding.

  • What about inflation? (Score:5, Insightful)

    by packrat0x ( 798359 ) on Sunday March 07, 2021 @08:02AM (#61132638)

    If your pay doesn't increase each year, your buying power typically decreases. There are always exceptions, but for most Metropolitan Statistical Areas: economic growth plus government spending in excess of receipts equals inflation. Thus, a Cost of Living Adjustment is not a pay raise.

    • Giving everybody a raise while changing nothing else would do nothing due to inflation, but giving a raise to a *sector* of employees (low wage in this case) would help them because the pay increase is received only by them, whereas the inflation is spread out over everybody. In other words it's a tactic for leveling out the distribution of income, moreso than increasing the total size of the pie.

      • Regrettably, the general trend of wages in the United States has been the opposite: more money is flowing into the hands of the wealthy as a share of the total economy. That trend was starting to turn around in 2018/2019 but then Covid happened so who knows what happens next?

    • There's proposals to tie minimum wage to inflation automatically so the situation we have now (where minimum wage isn't enough to survive in any state of the Union, even the deep south) doesn't happen.

      If you're worried about minimum wage increasing inflation don't be. Inflation becomes a problem if and only if the wages paid exceed out economy's ability to absorb the increased money supply.

      e.g. if you give everybody $10,000 you'll have a run on Lamborghinis and prices will shoot up because there's n

      • Re: (Score:2)

        by hawk ( 1151 )

        >There's proposals to tie minimum wage to inflation automatically

        that's one of the best ways I've seen to lock in inflation . . .

        >so the situation we have now (where minimum wage isn't enough to
        >survive in any state of the Union, even the deep south) doesn't
        >happen.

        the minimum wage/cost of living comparison is really a red herring, though.

        Minimum wage jobs are generally entry level jobs for unskilled workers. They are how workers *get* the skills to make a living wage.

        Workers staying at minimu

      • If minimum wage kept raising with inflation from when it first began, it would be $4.52 in today's dollars. We keep raising the amount not because of inflation, but because people keep moving the goalpost around. The highest it ever went was in 1968 where it was $1.60 per hour, or $11.88. $15 would make it the highest ever. It's kind of like how customary tipping has gone from 10% in the earlier days to about 20% now. Where does the madness stop?

  • Sounds like socialism... (Score:3, Insightful)

    by h33t l4x0r ( 4107715 ) on Sunday March 07, 2021 @08:03AM (#61132642)
    But fuck it, I'm in. Because whatever we have now is not working.
    • The U.S. has been socialist for decades. What is Social Security or Medicare or a hundred other programs that give people money? It's just a half assed socialism.

      • These aren't socialism or even examples of socialism, these are welfare programs.

        Socialism is defined as a government owned means of production. That means say factories or even business entities who are controlled by the government, and whose workers are paid by the government, is socialism. Better examples of socialism would be government owned utilities, though that does not include private corporations that serve as utilities and are strictly regulated by the government.

        Some socialists argue that it's "

    • No, it's not socialism.

  • Mathematically you can't have higher wages, no loss of employment, and no increase in prices unless you're asserting that these heartless, brutally-dollar-driven companies are just absorbing a massive loss on profitability.

    • "Mathematically you can't have higher wages, no loss of employment, and no increase in prices unless you're asserting that these heartless, brutally-dollar-driven companies are just absorbing a massive loss on profitability."

      Not the only factors to consider. Worker well-being and how that affects productivity for example.

  • Let's see how long it takes Slashdot's political activist moderators to mark this post as flamebait, or similar.

    Increasing cost of labor leads to fewer jobs, in general. Hard to argue basic economics.

    However, I suspect that regions with strong economies and tight labor markets would be ok. Job losses would likely impact primarily teens and undocumented immigrants. At least, this is what I see in my neighborhood.

    On the flip side, large increases in the minimum wage would devastate regions with weak economies

    • I find it hard to believe companies hired 1.4 million people they didn't need.

      • They hired 1.4 million people they could afford to keep onboard at $9/hr or so. Raising their wage artificially without any associated factor is enough to make some businesses - notably small ones working on razor-thin profit margins - is enough to kill an entire business or make them cut hours/output.

  • "the sky doesn't fall."

    shzm... knorkk... BZZT!

    Narrative mismatch detected! Responses selected and initiated. "FAKE NEWS! FAKE NEWS!"

    Contrary anecdote search underway... single mismatching data point located. Injecting into base.

  • In 1964, the minimum wage as $1.25. Supposedly, in 2021 that's $10.25. Wow, what a big improvement! Except that increase in the minimum wage is a magical calculation that treats 1964 dollars as fiat currency when they weren't fiat currency.

    The actual value of $1.25 worth of currency when you factor in the gold standard and the use of silver in most of our coins puts the 1964 minimum wage at about $22-$25/hour.

    But hey, keep fighting for more fiat currency, even though that's like giving someone a blood trans

    • Re: (Score:2)

      by Cyberax ( 705495 )

      The actual value of $1.25 worth of currency when you factor in the gold standard and the use of silver in most of our coins puts the 1964 minimum wage at about $22-$25/hour.

      Who the fuck cares about gold and silver in coins? Workers back then were not paid in coins.

    • and yet, it was in mid 70s, was when minimum wage had the most impact for us. So, no.

  • A high minimum wage gets effectively cancelled in about a year or two because products and services â"especially rent get more expensive. People have more money, number of housing units and production rates stay the same or less â" so rent and prices go up. Of course we are harming low wage workers and the unemployed by increasing the minumum wage. But who cares? Big numbers feel good like weâ(TM)re doing something helpful, when weâ(TM)re not.

    • That is not correct, and too simplified.

      The paper I read that researched this, some 1 1/2 decades ago found that in a high-wage economy, people are far better off than in a low-wage one, while nothing differed for businesses. (Talking about the peaks and troughs.)

      The "it's complicated" part is everything in-between.

  • A high minimum wage is great for large companies. The competition cannot afford to hire workers. The large company can produce the goods and free to price it super high because there is no competition. End result is more unaffordable prices, your increased salary because useless. Instead of meaninglessly increasing wages how about figuring out how to increase production and number of housing units ? If there are 11 people and only 10 housing units the rent will be adjusted so that only the richest 10 get th

  • really? there's plenty of companies paying grunts 15 bucks an hour but when amazon does it, its minimum wage? no fuckwits, minimum wage didn't change, amazon is just paying wages... that's how it works guys

  • The narrative is that raising minimum wage will not cause [significant] job loss. That is not a warranted conclusion.

    Amazon does not for the most part operate in places where there are large concentrations of minimum wage workers, namely city cores and suburbs. Amazon is mainly in the exurbs, i.e. outside the most congested areas.

    The types of workers that can be expected to lose their jobs with a doubling of the minimum wage live in places that do not already have a high minimum wage, and also mainly do l

    • Bull Shit.
      Back in the 60s' and 70s, we had a decent minimum wage. We also had relatively few on social benefits due to this. What is needed is to raising minimum wage, possibly with a 2-tier approach of 10 for rural and 15 for metro. Just thinking about, states should be allowed to lower down to 10 for economically depressed areas that they want to develop.
      Likewise, we need to phase-in e-verify with strong penalties, and to use e-verify for social benefits. There is a LOT of fraud these days and it is no

      • The problem with e-verify is that it's security theatre for illegal labour, it's basically the same as the status quo but with less paper and more computers and a little more speed as a result. The only things it achieves are:

        1. Giving right-wing culture warriors a boner, because at first glance it looks like it might be intended to make hiring illegal labour more difficult, and that's good enough for use as a culture war weapon so it's never examined further by the side that (intentionally) engages in it.

        2

        • Meant to reply to your next post: https://yro.slashdot.org/comme... [slashdot.org]

        • e-verify is needed for MULTIPLE reasons.
          1) you are correct that e-verify is being used a game by both parties. Neither of them want to piss off illegals/Latinos, and yet, it is the legal minorities in America that are being paid less or forced to work without paying tax (so as to compete), which could land them in jail. For illegals, they just export them and they come right back.
          2) e-verify really will work IFF we require it of ALL jobs, AND SOCIAL BENEFITS. Right now, we have never had the level of soc

      • Back in the 60s, the American worker had less foreign competition. Trading with foreign partners that can keep wages low reduces the market value of labor domestically.

  • THis is why We need the compromise bill that several are pushing:
    1) raise minimum wage to $10, but I would suggest 10 for rural, and 15 for metro areas.
    2) phase in e-verify for jobs, but I also suggest that we use e-verify for federal/state benefits. We have lots of fraud going on right now.
    3) tightening of benefit requirements.

    This simple bill, with some compromises, would change a lot of things.
  • If companies like Amazon and others are naturally raising wages to over double the minimum wage doesn’t this mean we don’t need to bother raising wages because the market is already taking care of that? My local Walmart and McDonald’s also start at 13-14 a hour, which means any company trying to pay someone close to minimum has a hard time hiring anyone. I think this is how it should be, raising minimum wage will not help.

  • ... if there are no ill effects, raise the minimum wage to $50/hr. then.

    Or $75. Or $100. But why stop there? I mean there are no ill effects at all, right? Why not $200/hr? How's that for some stimulus?

  • If there are no funny-modded comments, how about showing any comments that have a secondary mod as funny?

  • Companies will eliminate the entry level jobs and make the higher level people do more for the same pay. Those that don't will simply charge more for their goods and services and the "raise" is then offset.

    Repeat after me: Entry level jobs aren't meant to be permanent.

    You get an entry level job, work hard and develop skills/experience/education, then you move up or move on to a higher paying job at the same or different company and leave the entry level job open for the next kid starting off.
  • So do all the landlords in Amazon's catchment area see this as an opportunity to raise what they charge, too? On the basis "hey, my tenants have had a pay rise ... they can afford to pay more rent". And then all the discretionary services follow suit. So haircuts cost more, pizza costs more, petrol costs more and in the end that pay rise is simply eaten up by rising prices and none of the workers are any better off.

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