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RE: Why minimum wage hurts minimum wage earners.
I love this! I always hear stuff about "They need to raise it" etc. I think they should get rid of it all together, If they make it so an employer can pay whatever they choose. Then more people will get paid based on worth, Because someone who has a lot of experience won't work at 7.00 an hour, They'll negotiate a different pay amount. I feel like by removing it all together things will become somewhat more balanced.
I don't think we need to get rid of it. Otherwise when the job market is like this there will be those working for $2-$3/hour. I think the minimum wage should be set by the local government, even at the city level.
So then you'll simply have the local government dictating who is employable and who isn't. And watch cities with higher minimum wages die as all the jobs move to the next town over.
I didn't have time to finish the thought, but yes, that could happen. If it does then the city changes the law or dies. It should be more or less a wage that is above slave labor but below what an entry level person should receive for their work depending on the local market and cost of living.
Ideally, though what people should be asking is for the government to re-evaluate taxes, regulations (compliance), licensing, etc. that is making it more cost effective to go elsewhere. In the end we are the ones that pay, consumers and workers.
Competition isn't just good for consumers, more businesses and less unemployed means competition by companies for employees. You don't want to have a labor shortage, but right now we have an overabundance of labor looking at the BLS statistics. Younger Americans aren't entering the workforce as early and older Americans are keeping their jobs longer.
Part of the problem is that the US has shifted from a production/manufacturing based economy to a service based economy. Most services are low paying, those that aren't are being outsourced as the technology becomes available to do so.
An upcoming project I may be involved in is outsourcing labor, they can pay someone $25k to put together a software application as opposed to the $45k an individual wanted here. There is no incentive to hire someone in the US in this situation. How do we encourage companies to hire locally when someone will work cheaper in another country?
The problem isn't just about minimum wage, raising it/lowering it won't help unless other policies are re-evaluated and more jobs are created.
This is all off the top of my head.. didn't reread and edit it. Busy day but I wanted to respond. Sorry if I repeated myself anywhere or if I don't make my thoughts clear.
I've heard the argument about shifting away from production and manufacturing, and that's a red herring. The issue isn't what kind of businesses there are. The issue is that more and more, the businesses that are here are huge monolithic organizations that streamline and eliminate jobs a thousand at a time to cut costs, which is to be expected. Businesses always want to cut costs. That's a way that you make more money.
The problem is that there's not enough businesses of any type. The more businesses you have, the more jobs you're creating. The fewer regulations you have on businesses, the more businesses you'll have, and thus, the more jobs you'll have. You don't need a minimum wage to improve the standard of living, you need an environment that doesn't punch you in the face if you try to start your own business.
Yes, although simply getting rid of minimum wage won't fix the jobs issue. You need to stop requiring all the expense of the fees and the fines and the permits and licenses for new businesses. Small business are, and have always been, the largest employer. All the layers of restriction prevent them from being formed in the first place, which does nothing good for the price of labor, from the perspective of the worker.
What you said describes so well one big reason why I left the USA all those years ago.
I did not wish to become a boiled frog.
Wish it were fixable, but it ain't.
![The One Law]
)
Oh, it's totally fixable. Of course, there's a possiblility that there will be times of hardship. But open your eyes and look around. People are taking the legs out from under government everywhere you look. You can buy bitcoins instead of dollars, decentralized services are popping up more and more, people are becoming more and more comfortable simply ignoring the arbitrary sharecropping rules that government has been imposing on business since government realized it could just make people give it a percentage for no apparent reason.
Things are changing. There will be rough times while people sort out a new way for things to work, but the old world is going away, one tiny little bit at a time.