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Published: Tuesday, July 23 2013 12:00 a.m. MDT

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CPrice
Orem, UT

I dislike that notion that by paying our citizens more we are hurting our society, how is it possible for anyone to think that anyone living in America, or more specifically Utah, deserves to earn less money simply due to the fact that they are in an "entry level job". I feel it is note worthy that most teens who want summer jobs will work where ever they are able to; not just in the locations mentioned in the article. Also, and I do speak from personal experience, teens have summer jobs to allow them to have a small degree more of independence from their parents. If parents are willing and able to financially support their children that is great, however we should not place more strain on those teens and young adults that don't have parents that are able to support them by lowering or keeping their wages low. Finally, the notion that not having a summer job will hurt a teens economic standing is ridiculous! Anyone who wants to go far, can go far; is that not the essence of the American dream? So says this young adult of 23!

Utahwoody
Salt Lake City, UT

By this logic there shouldn't be a minimum wage at all. There are advantages to a higher minimum wage. Hundreds of thousands of people who have low-wage jobs would be lifted out of poverty and the economy would be stimulated because lower-wage people would have more disposable income. And they would spend pretty much all of it. This would then create more jobs.

Apparently the author favors the ever-widening gap between highest income and lowest income. If this trend continues there eventually won't be a middle class.

Blue
Salt Lake City, UT

This is preposterous.

An editorial attacking efforts to raise the minimum wage written by the "Economic Policy Institute." And what is the Economic Policy Institute?

It's a Washington, DC public affairs firm owned by Rick Berman, who lobbies for the restaurant and hotel industries. Googling this guy is the ultimate eye-popping experience.

The author of this editorial and the "institute" they work for are shills for low wage employers.

Berman and Company are the same guys the tobacco industry hired in the 1990 to write editorials claiming that smoking isn't bad for you but that regulation of tobacco was.

Here's what must be remembered: Worldwide, other developed nations have managed to mandate a living wage _and_ maintain unemployment rates that are lower than in the U.S.

E & EE
Ann arbor, MI

Did you read the article CPrice and Utahwoody? It's pretty clear in the article why a minimum wage causes unemployment. But to recap:

Raising the minimum wage makes it more costly (for employers) to hire workers at that price. Since these employers have thin profit margins (i.e. they are not making much money) increasing costs can easily wipe out their profits. Why do business if you're losing money? So to make up for it, employers have to raise prices or cut costs. For these kinds of employers, cutting costs usually means hiring fewer people. Thus higher unemployment for those people. And Utahwoody, those hundreds of thousands of people with low-wage jobs would not be lifted out of poverty. They would find themselves without a job.

And CPrice, those locations mentioned are often the only places that teenagers are qualified to work at with their limited experience. That's why the author focuses on them. And why would someone with an entry level job be paid more? They have less experience and are generally less productive. So they are worth less to an employer.

Basic economics.

RanchHand
Huntsville, UT

Giving your employees a living wage vs giving all the profits in the company to the CEO.

Hmm, such a difficult choice.

Roland Kayser
Cottonwood Heights, UT

When all businesses hike the wages of their employees it increases their costs. It also puts more money in the pockets of their customers thereby increasing sales. The minimum wage needs to be $10.50 just to get back to where it was in the sixties.

Edgar
Samaria, ID

Let's first acknolw;edge that Secretary Perez's job is to be an advocate for American labor. Let's also acknowledge that private industry has the right to psy wahtever it wants, as long as it complies with national and local laws. 19 states have now enacted living wage laws that require companies to pay workers more than the national minimum wage.

We have seen CEO and senior management compensation continue to increase over the past decades to where the average CEO now makes more than 500 times what the average meployyee makes. If an employee makes $30000 per year their CEO will make $15M. Of course there is a difference in the job assignments of these two but you get the drift of the trend. You could hire 500 workers by eleiminating just one person.

Labor unions have lost influence over the past 3 decades and so one of the vehicles left to help labor is a minimum wage tied to inflation rates. Companies have to hire workers to do the work so if they have to pay more for labor, maybe they will have to reduce executive compensation, at least by a bit. Seems fair to me.

FreedomFighter41
Orem, UT

Out of curiosity, does anyone here know what wages are for restaurant workers? It is $2.13 per hour. Now we wonder why so many are on food stamps and up to their necks in student loans? And this joke wants to get rid of this set wage? So it can be even lower???

If we want to destroy what little is left of America, then we should follow this guy's advice.

I'm just so frustrated with today's "job creators." How much is enough? What ever happened to Henry Ford's logic, keep your workers happy and well paid and they will become customers? Today's capitalists see their workers as cattle or slaves. The more you can get out of them and the less you compensate them, the better.

When will the right realize that we aren't struggling because the rich aren't rich enough but that the rest of us lack the buyin power to jump start this economy?

Ultra Bob
Cottonwood Heights, UT

When a businessman presents an argument for or against government action, you can bet your booties that the object of discussion is from the business perceptive. The notion of wage increases killing jobs is as phony as a 3 dollar bill.

The fact is that our system of wealth distribution in our society, our nation and even the world is broken. Meaning; that it is not working properly to maintain the existence of civilized human society.

The loss of balance between the creation of wealth between wit and physical labor can only be fixed by government. Private enterprise is not going to change in any direction that reduces their profit advantages created by the imbalance.

A possible solution would be for the government to hire every unemployed person at a proper wage to secure the rights of people to life, liberty and the pursuit of happiness.

There’s plenty of work to be done in our society so they won’t be sitting idle. The cost for such a program would be put directly on business. Business would have the choice of paying the tax or hiring the worker. In either case we get full employment.

The Real Maverick
Orem, UT

When will people realize that without paying people liveable wages that we are slowly killing the golden goose? The people who really create jobs aren't the richies but the consumers/workers. If the workers aren't being paid enough to become consumers, then the economy fails. You don't save your way out of a recession but spend your way out of it. Have we learned nothing from the Great Depression or Europe's failed austerity policy?

Larry Chandler
CEDAR CITY, UT

There may be some instances of downside to raising the minimum wage, but the upside is far more compelling. Higher wages mean more purchasing power and that benefits all companies including those who would pay millions to their CEO while trying to cut wages and benefits for the most impoverished of their employees.

It is immoral to pay people so little that they cannot afford health care, food, and even a home without public or private assistance.

KDave
Moab, UT

I started working for 35 cents an hour. At that time that would buy me a hamburger , fries and a soda. Now min wage is $7.25. What do you pay for a combo meal at a fast food business?

Maudine
SLC, UT

Australia's minimum wage is double that of the US and their unemployment rate is half that if the US.

Card and Krueger from Princeton University did a study comparing youth unemployment in states that raised the minimum wage compared to states with a steady, lower minimum wage. They found that youth unemployment decreased when minimum wage was raised.

Berman, the author if this editorial, is familiar with the Card and Krueger study, but doesn't like the methodology which focused on number of employees not number of hours - although I am unaware of why that would make a difference if the rate per hour is the same. Berman has never provided any peer-reviewed studies that contradict the findings of the Card and Krueger study. The study he references in this editorial talks about estimates, not facts.

The hard data argues against the conclusion reached by the speculation of this editorial.

lost in DC
West Jordan, UT

There is a definite correlation between lower or no state minimum wage laws and lower unemployment rates. According to data from the BLS and DOL, of the 10 states with the lowest unemployment figures, 9 either have no state minimum wage law, or their law is lower than or equal to the federal statute. Only 1 has a higher minimum wage law. Of the 10 locations (states plus the District of Columbia) with the highest unemployment rates, half have higher minimum wage laws.

Higher wages drive the need to get by with fewer employees.

Roland,
With more money in their pockets, the employees would still buy goods that cost less to make and therefore have a lower selling price, ie, imports. The analogy you try to draw is a fairly tale.

If you want to drive up wages, create a business friendly environment as they have in North Dakota. There is a labor shortage and very few work for minimum wage there. but rather than actually stoking the economic fires, BO and his cabal are busy dousing them.

Universal Truth
Salt Lake City, UT

One commentor facetiously said perhaps there should be no minimum wage, but that is frankly correct. What you will find is that when businesses need to pay more to their employees to keep them from going elsewhere, they will--including to unskilled labor like teenagers; nobody is legally requiring In-N-Out to pay their teenage workers a starting wage of $10/hour, yet they do, and you can be assured altruism has little to do with it.

Has no one here ever lost their job because their company cut workers or moved operations to an area with lower wages? Conversely, does no one here make more than the minimum wage? Businesses have a balance to maintain between wages paid and revenues earned. That's why my national firm has increased operations here in Utah (lower wages) and decreased them back East. It works the same for the lowest wages. If a business relies on the lowest-skilled, they have a target for what one job should be worth. If they are required to pay more than that, they will then simply make one person do the work of two or three.

Just an Observer
Salt Lake City, UT

I'll add my two cents. I knew a manager of a unionized grocery store years ago. He said that because the union forced certain wages at certain numbers of years of employment (effectively a minimum wage), but because the employee's actual value to the store in productivity did not increase commensurately, the only way he could deal with the increased wages was to reduce the number of hours the higher-paid employees worked. It sounds to me like the same concept a couple of others here are pointing out.

Lightbearer
Brigham City, UT

It seems as if you could sum up the philosophy of some people like this: "The poor can never have too little, and the rich can never have too much."

The claim is laughable that paying workers as little as possible is actually for their own good. I doubt that workers see it that way, or do CEOs receive letters from workers thanking them for paying the bare minimum, and asking them to pay even less?

Apparently, many think that the rich are industrious and virtuous and deserve everything they can get, while the poor are lazy and immoral and only deserve the crumbs from the table, if even that. So I wonder how many people actually believe that "a rich man shall hardly enter into the kingdom of heaven" or that "It is easier for a camel to go through the eye of a needle, than for a rich man to enter into the kingdom of God"?

RedShirtMIT
Cambridge, MA

To "RanchHand" if we force businesses to pay a "living wage" for unskilled labor, do you know what some of the unintended consequences will be?

I am going to say that you probably haven't thought about the consequences.

1. You increase the teen unemployment numbers. Fewer jobs for teens (they don't need to earn as much since most of their expenses are covered by parents) means that you have fewer people prepared for jobs as adults. With fewer adults prepared for the work environment you have decreased productivity.

2. Costs increase or else few people are hired to work. Think of your next trip to the craft store. Now, instead of 2 nice ladies cutting fabric, the store has cut one job so that they don't have to raise prices.

3. Liveable wage soon becomes unlivable because everything else is now more expensive. Now, you repeat the cycle.

4. Higher unemployment. Economists have found that increasing minimum wage leads to more unemployment. See "The Minimum Wage Delusion, And The Death Of Common Sense" in Forbes.

That is just the beginning. Are you prepared for the consequences of your desires?

SG in SLC
Salt Lake City, UT

@KDave,

What you are describing is wage purchasing-power parity. Is the purpose of your anecdote to imply that the increase in wages is what caused the increase in fast food (and perhaps other) prices? If so, I would point out that correlation does not imply causation. It is at least equally likely that wages have risen to try to keep up, at least somewhat, with general inflation. Wage increases typically lag price increases, and real (inflation-adjusted) wages have been generally declining since the mid-1970s, fast food wage-price parity notwithstanding.

There is also a lot more food in a combo meal today, versus that burger, fries & drink from when you were making $.35/hour (probably roughly comparable in size to a Happy Meal today).

RanchHand
Huntsville, UT

@RedShirtMIT;

You conveniently ignored the bit where I mention paying the CEO more so you can pay the employee less.

One of the consequences of the status quo is that it is taxpayers subsidizing business by paying for food stamps, health costs, etc. of the employees barely scraping by because the companies are allowed to get by with the status quo.

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