Posted on 09/06/2021 6:21:50 AM PDT by Oldeconomybuyer
The federal minimum wage in the U.S. has remained glued at $7.25 an hour for the last 12 years, the longest stretch without a boost since it was first adopted in 1938. Yet there's another revealing figure that underscores how the minimum wage — created by Congress after the Great Depression as a way to ensure that Americans were fairly paid for their labor — has failed to keep up with the times.
Even as workers have been more industrious — helping drive corporate profits, the stock market and CEO compensation to record heights — their pay has flatlined, or even declined when factoring in inflation. If the minimum wage had kept pace with gains in the economy's productivity over the last 50 years, it would be nearly $26 an hour today, or more than $50,000 a year in annual income, one economist notes.
"That may sound pretty crazy, but that's roughly what the minimum wage would be today if it had kept pace with productivity growth since its value peaked in 1968," wrote Dean Baker, senior economist at the left-leaning Center for Economic and Policy Research, in a recent blog post.
Baker's analysis comes at an uneasy time for millions of workers across the U.S., even as they celebrate Labor Day. The COVID-19 Delta variant means many white-collar workers won't return to the office until 2022, while many lower wage workers continue to cope with the risk of getting infected, not to mention confrontations with anti-mask or anti-vaccine customers.
Inequality also widened during the pandemic, with the wealth of the richest Americans surging as stocks soared, while those at the bottom were more likely to get laid off than white-collar workers and also more likely to work in jobs where they faced a great chance of catching COVID-19.
(Excerpt) Read more at cbsnews.com ...
Productivity in burger flipping jobs has increased?
Unfortunately, many workers can share similar stories. I've worked at places were customers would ask me, "why do you work here?". I tell them, "because you insist on shopping here. If you shopped somewhere else, they'd have a job for me." Several customers had unclean hands as well; illegally writing off items for their own businesses by buying personal items with their corporate cards. They knew the store owner wouldn't flag the purchases.
Government doesn't want to shut these businesses down because they want the tax revenue and ratable properties, regardless of how they get it. That Corvette that the coke-head owner bought keeps the local dealership going.
Increasing the minimum wage isn't the answer and might make it worse. A competitor to one of these worker-hating companies has a higher threshold to enter the market if they have a high minimum wage to start with.
As many comments touch on, productivity gains are the result of capital investment in equipment, especially in computers and robotics/automation. Productivity gains generally drive down the market value of unskilled labor and therefore wages.
Government regulation increases the non-wage costs of employing un- and low-skilled workers further reducing the desirability of employment. The situation is the exact opposite of what the author is pushing.
Yes, because now you're able to create, edit, and archive thousands of documents instead of having to retype each one as needed. If you're good, you'll add logos and other graphics. You can dramatically shorten the timelines between drafts and publications. The company can remove thousands of hard-copy files and you don't have to spend hours each day retrieving old copies and replacing them with the updated ones. You're going to be one of a small efficient team instead of a large steno pool.
I've lived through what happens when the company pays typist rates but expect word processors. The old lady they hire for peanuts can't find files in the computer but "that's okay, I'll retype it quickly" for ...every ...single ...document.
That first chart states that the compensation and productivity diverged in 1979. However, it is hard to see on that graph but it looks like the divergence started earlier, maybe around 1972. Why pick 1979 then? Probably the typical liberal argument of blaming all economic woes on Reagan and the tax cut policies dropping the top rates. If only we raised rates back to 70% all our problems would go away is what they believe. Any link to inflationary monetary policy and outsourcing is conveniently ignored.
I’m a veteran, engineer and make 6 figures.
Thanks for your useless input.
I’m a veteran, engineer and make 6 figures.
Thanks for your useless input.
—
I am not sure why you say useless since your statement is not on point.
Question - is minimum wage good or bad for our economy?
I say in the long run minimum wage (along with government mandated employment rules) is bad for our economy.
The fact that you as an individual are doing well does not dispute my point.
But thank you for your input.
Many of us have worked at places like that. Owner lived in one of the most expensive neighborhoods in California drove an $80,000 car and had a mistress and a drug habit.
But didn’t have money for raises.
I never was so happy to leave a job as that one.
Eventually his business collapsed.
Their is a group on FR and within Conservatives as a whole who will always blame the employee, always.
They form the backbone of the “Stupid Party”.
The inflection point coincides nicely with the introduction of widespread computing technology and industrial robots. Workers did little to improve their own productivity, and have a pretty thin claim to more than a small fraction of the benefits.
You're right, it's a ridiculous argument. The author states:
"Even as workers have been more industrious — helping drive corporate profits, the stock market and CEO compensation to record heights — their pay has flatlined, or even declined when factoring in inflation."
So this dim-bulb "fake newser" wants us to believe that American "corporate profits, the stock market and CEO compensation" in general are somehow based on increased productivity by 'burger flipper' minimum wage workers. Oh, you betcha...
What about jobs where productivity has gone down since the 1980s? There are jobs where it takes more people to produce less output and the output is generally lower quality than before. I’m thinking of education. There are more administrators, more teaching assistants, smaller class sizes and more idiots who can’t read their diplomas graduating.
Yeah, I forgot the drug habit thing. That first business I mentioned, the owner was a Vietnam vet and picked up a heroin habit over there that he never kicked. He’d go to the back shop for a few minutes and when he came back, his face was falling off of his skull. All droopy and he couldn’t hardly talk.
We tend to talk about the middle class like it’s a single group but I noticed over the years, a divide between people who sit at a desk and people who work in the shop or in the field and get dirty. I probably made as much as plenty of office workers at the places I worked but some of them just looked down on anyone who gets dirty for a living.
Even though I was always a shop guy, I was into computers and ended up setting up the network at two places and was also the go to guy when they had a computer issue. Most of them only knew how to use the one or two programs they needed to use but didn’t know computers in general. I was still never allowed to touch a computer unless I was fixing it. Wouldn’t let me stick one in a corner to use CAD on occasion. I was still dirty and unworthy.
I ended up going self employed and even had a few employees for one big job that lasted 6 months.
“The fact that you as an individual are doing well does not dispute my point.”
“With that outlook it is unlikely you will ever succeed.”
It disputes the above, which is what I was replying to.
“I say in the long run minimum wage (along with government mandated employment rules) is bad for our economy.”
I would say in the long run if people are treated like crap, they will vote to take your stuff more often, and in greater amounts. Minimum wage and unions came about for a reason. Companies should be punished for outsourcing, or incentivized for keeping jobs and manufacturing here.
With so many things being automated, future economies will have to adapt somehow. Most are not intelligent enough to fix/program the computers/robotics. I’m not sure of a solution for that aspect.
The US is heading in a poor direction economically, morally, culturally, and demographically.
The productivity of an engineer may have increased dramatically - that of a burger flipper, not so much.
When it comes to simple manual labor of any kind, productivity is limited by the nature of the human body.
'Trumpism' was a natural blow back from said policeis, that took years to take a toll on the American worker. Those problems will persist, as sirens such as Goldsmith, Perot and Buchanan warned about.
created by Congress after the Great Depression as a way to ensure that Americans were fairly paid for their labor
The Davis-Bacon minimum-wage law was enacted to keep blacks out of the labor force.
Economist Walter Williams has called the minimum wage “one of the most effective tools in the arsenal of racists everywhere in the world.”The Racist Roots Behind the Minimum WageAs documented in this Cato Institute research paper, the first minimum wage law, the Davis-Bacon Act of 1931, had racist origins. According to researcher David E. Bernstein, the story begins in 1927 when a contractor from Alabama “won a bid to build a Veteran’s Bureau hospital in Long Island, New York. He brought a crew of black construction workers from Alabama to work on the project. Appalled that blacks from the South were working on a federal project in his district, Representative Robert Bacon of Long Island submitted H.R. 17069.”
This bill was the precursor to the legislation known as the Davis-Bacon Act that was eventually passed into law. The act mandated a minimum wage to any workers on construction projects part of a contract with the U.S. or District of Columbia governments that exceeded $2,000.
As Walter Williams has further noted about the Act, “Among the widespread racist sentiment was that of American Federation of Labor President William Green, who complained, ‘Colored labor is being sought to demoralize wage rates.’”
Shhh
Don’t tell the truth about greedfilled employers.
Lotsa people here are bootlickin’ masochists who love being ground into the dirt with bottom of the barrel wages and zero benefits.
They think the rest of us should too, apparently because misery loves company.
But most don’t since they have something resembling self respect and an understanding of economics...which is you don’t work for garbage that doesn’t pay what you’re worth.
That’s a different skill set. I like the word example because I was a computer programmer for decades and I saw the change from typewriters to wordperfect to word. The impact of hell industry was this: we got rid of the secretaries and we all typed our own stuff up. And we could because it was easy. No more liquid paper no more high-speed typing skills, composed as you go along, etc.
At the end of the Dave pay is usually determined by one of the following: how difficult is it to learn your particular skill, how much value do you bring to how many people. And the latter has to consider the former. If giving a secretary of word suddenly allows for to do five times as many things without teaching her any new skills, she will not receive any more pay because there will be plenty of people out there that want to do that same job for the same pay she’s making. On the other hand, if she learns all the nuances of word and is able to do all those other things with it because she’s trained herself to do so, she’ll make more money cuz she’s the only one that can do that stuff. but of course what really happens is one by one they all learn how to do all those other things and at the end of the day they end up making the same amount per hour that they always made. That is, and unless they add new things to the table, like the skills I was talking about. But again that has to be skills that are difficult to learn.
At the end of the day the market determines the price.
Short answer. If the secretary learns all those additional skills, she’ll be more valuable, therefore will earn more pay relative to other secretaries who didn’t learn those skills.
On a side note I consider the minimum wage to be raw textbook fascism. The government should not be involved in how much employers and employees agree upon as a salary. If things get incredibly unfair, there’s always unionization.
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