Minimum wage hikes are causing restaurants to close, costing jobs

[Gestopft]

Your data is skewed by including developing countries.

And since you haven't shown any data, your anecdote is skewed by including Switzerland and the US in the same category. Despite no national minimum wage, about half of Swiss workers are covered by collective bargaining, which does include minimum wages (and presumably, as is true in the US, helps raise wages of non-bargained labor). And the other developed countries with no minimum wages (the Nordics) have even more of the workforce covered under unions/collective bargaining. Which again- does include minimum wages, but done by sector instead of for the whole country.

Also, see here for graphs of developed countries.

[Kokolums]

You are confusing two different scenario's now.
A business that is new and still needs to make an actual profit is not the same as established business that can't afford to keep up with inflation.

The post I quoted did not say anything about "established" businesses.

- - - Updated - - -

That type of model are only used by investment firms who set deadlines on firms they buy on cheap.

Business owners have all types of models.

[Grimbold21]

No, it's not. Youtube of Fox Business is perhaps one of the most ridiculous sources of information available.

Raising the minimum wage is good for everyone. From the U.S. Government.

The text mentions Seatle. Does this study then disprove some of the suggestions made here https://www.nber.org/papers/w23532 , namely the implications that though wages rose, hours were reduced and less money earned overall ? Unless I misunderstood the Abstract's info.

[Endus]

Your data is skewed by including developing countries.

My data is skewed by looking at all the available data, rather than trying to cherry-pick to fit the assumption I want to support?

You've got this backwards.

Also doesn't even hold up when we bother to cherry-pick, either. Here's the same data skinned down to just those on the HDI list here; https://en.wikipedia.org/wiki/Developed_country



No observable trend line whatsoever. It's all fairly flat around the 4-5% range, regardless of where minimum wages are.

You are making shit up that there is no data to support. You're just observably wrong as to the facts.

[Sorshen]

Sounds like these businesses deserve to go under and be replaced, so yay capitalism?

But ofc Fox needs to create a shitty strawman.

[Gestopft]

The text mentions Seatle. Does this study then disprove some of the suggestions made here https://www.nber.org/papers/w23532 , namely the implications that though wages rose, hours were reduced and less money earned overall ? Unless I misunderstood the Abstract's info.

It's important to note that that paper was done while the policy was still in the midst of implementation, and subsequent studies- including by the same authors- have cast doubt on the initial findings.

[Mekkle]

If you cant pay your workers, you shouldn't start a business

[Twdft]

I never understood the idea that min. wage should not be indexed to inflationary measures. Like really? Do people not work in their own contract to make more then inflation anyway?

The problem with minimum wage jobs is that those employees have no power to negotiate anything better. No unions to help, no mandatory collective bargaining. Minimum wage jobs are "take it or leave it" unskilled work and would pay even less if employers were allowed to and they certainly won't increase minimum wages on their own.

[ati87]

The post I quoted did not say anything about "established" businesses.

- - - Updated - - -



Business owners have all types of models.

You are inserting the new business argument yourself in this discussion.

[freezion]

Countries in Europe with minimum wages closer to the U.S. have similarly low unemployment rates like Switzerland (no minimum wage) or Germany (had no minimum wage until recently).

i hope you do realize that even though those countries have no federal minimum wage (germany being a recent exception, but a lot of others still haven't got one), there's a defacto minimum wage as a result of them being heavily unionized.
We're talking at a level where people who's not member of a union, often will get hired under the same wages and conditions as somebody who is, because it is so ingrained and the employers are not willing to run the risk.

A mcdonalds in denmark has higher running costs than the ones in the US, and pay their lowest skilled workers around 18-ish usd/hr. the cheeseburger only costs 50 cents more than the US (and prices in general are comparable to the US), and they still somehow turn a profit.
And albeit anecdotal, when i visited the US café prices were close to danish prices as well. But yet the business allegedly can't keep themselves going without having their customers subsidize their employees already insanely low wages?
it sounds more like there's other issues that's making them fail, and they are using wages as a scapegoat to avoid paying their employees a living wage.

- - - Updated - - -

That's not true. Maybe a business model requires x number of months to scale up before the business becomes stable or even insanely profitable. An unexpected expense can cause the company to go under before time expires.

Wages are not an unexpected expense.
And if you go by a business model that requires a rampup (looking aside from drawing in customers for new businesses) you should always include redundancy, and make sure you have the resources to reach the breakpoint. it may include overwork and unpaid hours from the owner/founders, not the employees.

Being shit at running a business is no excuse for underpaying your employees.

[Grapemask]

My data is skewed by looking at all the available data, rather than trying to cherry-pick to fit the assumption I want to support?

You've got this backwards.

Also doesn't even hold up when we bother to cherry-pick, either. Here's the same data skinned down to just those on the HDI list here; https://en.wikipedia.org/wiki/Developed_country



No observable trend line whatsoever. It's all fairly flat around the 4-5% range, regardless of where minimum wages are.

You are making shit up that there is no data to support. You're just observably wrong as to the facts.

Exactly. There is very little data to suggest that raising minimum wage leads to higher unemployment, elsewhere or in the US. Just within the US alone, we have a huge set of data to look at which tells us this: we used to raise minimum wage every year for decades until around Reagan. Unemployment, particularly among minimum wage workers, did not appear to change in any correlated way.

When the studies came out that showed this, conservatives launched their own study to prove the opposite: they showed that the last minimum wage hike resulted in a net increase in unemployment - they just failed to mention that the last minimum wage hike happened just as the Great Recession was kicking off, so there was a stronger predictor already in play (they got trickier with the data than this, because they claimed their study used a method to account for the Recession, but that's a whole harder thing to explain).

Minimum wage is basically a component of a correct understanding of the economy. American conservatives get it wrong because they insist on a "trickle down" economy, supply side, or whatever they choose to call it. They believe enriching the top of the business chain will result in success at the bottom, inventing more and more complex explanations for how this comes to be. But the simple truth is that the majority of all wealth goes one way, and that's up - so putting more money at the bottom means that more money is flowing through all of the various class and business structures on its inevitable trip to the top.

The Cherry-Picking Argument Fox News and the like use is one that's used in virtually every conservative argument on economics. Someone is going to do worse because of a minimum wage hike. And that's true. Just like it's true that curing cancer would end the livelihoods of millions of people in the healthcare industry that specialize in cancer research and treatment. But no one would ever argue that we shouldn't cure cancer.

[Shadowferal]

If we reverse tbose tax breaks that were given to the wealthy, I suspect congress could easily index min wage with inflation.

[Gestopft]

If we reverse tbose tax breaks that were given to the wealthy, I suspect congress could easily index min wage with inflation.

We should do that regardless, but you wouldn't need to do one to do the other. Indexing min wage to inflation would be a revenue increase on its own.

[jeezusisacasual]

The problem with minimum wage jobs is that those employees have no power to negotiate anything better. No unions to help, no mandatory collective bargaining. Minimum wage jobs are "take it or leave it" unskilled work and would pay even less if employers were allowed to and they certainly won't increase minimum wages on their own.

This is why again i support a more modern WPA to help lift those employees. I am in the camp of a rising tide lifts all boats.

[Bodakane]

The problem with not having a minimum wage is that the system is set up to prey on the most desperate. Morally and ethically, that can't ever be a good system.

[Pachycrocuta]

The problem with minimum wage jobs is that those employees have no power to negotiate anything better. No unions to help, no mandatory collective bargaining. Minimum wage jobs are "take it or leave it" unskilled work and would pay even less if employers were allowed to and they certainly won't increase minimum wages on their own.

I know it's part of a comedy bit, but a lot of comedy is rooted in the truth, and what Chris Rock said is sadly very true. At least, when it comes to here in America.

[Draco-Onis]

Business owners have all types of models.

As an owner you have two views your employees are labor in which case they represent a small percentage of your cost an increase would only hurt slightly or they are labor and assets in this case you would be paying them more anyways. The theory you are presenting only happens when private equity is involved because they want ROI at an exact time frame not a regular business owner.

[Dontrike]

That's not true. Maybe a business model requires x number of months to scale up before the business becomes stable or even insanely profitable. An unexpected expense can cause the company to go under before time expires.

What unexpected expense can turn a successful business into a dead one? The only ones that come to mind are lawsuits or natural disasters.

[PC2]

The problem with not having a minimum wage is that the system is set up to prey on the most desperate. Morally and ethically, that can't ever be a good system.

Okay well I wish more people would say that this is their position upfront. In many of these threads it seems that people are arguing with each other based on entirely different perspectives.

[Mihalik]

Who would've ever thought this would happen..... More democratic policies causing jobs to be lost.

A business that depends on slave labor for its economic viability doesn't deserve to remain in business.

I'm saying this as a business owner.

- - - Updated - - -

What unexpected expense can turn a successful business into a dead one? The only ones that come to mind are lawsuits or natural disasters.

The latter of which would be covered by insurance.