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I know the minimum wage in a lot of states is still $7.25 but are there companies who actually pay only this amount to their employees? Apparently everywhere pays at least $10 nowadays, even in states where the official minimum wage remains being $7.25.
It is becoming less and less common, but it wouldn’t be impossible.
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Originally Posted by Supposn
EduardoFinatto, minimum wage rates affect all labor compensation to some extent, but it doesn't affect all wage rates equally. Employees' aggregate proportional pay increases directly and indirectly due to minimum rate increases are proportionally greater for lower, and lesser for employees earning higher wage rates. Respectfully, Supposn
EduardoFinatto, minimum wage rates do not affect all labor compensation to some extent. A government mandated minimum wage below the market clearing equilibrium rate for a particular class of labor has no effect on that de-facto minimum wage. As an example, if the de-facto wage rate in a particular locale is $20/hour, a government mandated minimum wage of $12/hour has zero effect on the $20 de-facto minimum.
If you're making minimum wage (7.25) in South Carolina, you are probably homeless, if you have no other means of support. Why is our state government against people making enough to live? July 2009 is the last time MW was increased. Since then Social Security recipients have received 34.3% increases. How can we increase SS but not MW? Makes no sense to me!
I'm in SC too. I don't know of any place paying $7.25, do you? Government doesn't need to do anything, businesses already pay 2-3 times that amount for unskilled jobs like fast food and retail.
The only real way those who earn min wage will be okay to meet basic needs is showing only half of your income to IRS. Work under the table the other 50% In that event, food stamps are issued. Do that until you are on your feet.
Think outside the box taking jobs that provide housing, or many hours at once (what I did). I currently work a straight 48 hr shift. We also grew a good portion of our food.
Our min wage jobs came with excellent healthcare + the same excellent retiree healthcare which is pretty much zero out of pocket. No Medicare Supplement needed nor Part B at age 65. 79k in the retirement acct.
I will be working until age 70 for sure, possibly age 72 or as late as 75. I am happy about it, I enjoy working and will only take one shift a week 12-24 hrs a week. We'll be fine. At my age of 75, we'll take RMD's and I may stop working.
... EduardoFinatto, minimum wage rates do not affect all labor compensation to some extent. ...
TaxPhd, your statement, "minimum wage rates do not affect all labor compensation to some extent" is nonsense.
Throughout the world, even among employers who never heard the phrase "wage differentials" mentioned, most employers practice the concepts of wage differentials. Wage differentials are driven by lower rather than higher wage rates.
Due to employers’ common wage differential practices, increasing a crew’s wage rates generally*impels their supervisor’s rate also be increased.* Increasing supervisors’ rates doesn’t necessarily require increasing their entire crews' wage rates.
Although the federal minimum wage rate indirectly affects other wage rates, it doesn't determine wage differentials.* Respectfully, Supposn
Imo they're probably worse off. Pay hasn't kept up with housing and food costs.
The core issue, as I've been saying for years, is high housing costs. A lot of that is related to overly strict zoning rules and too many financial incentives for builders to build high end housing and not enough incentives for them to build more modest housing (smaller single family detached homes, as well as apartments, duplexes, and townhouses).
2nd biggest core issue is health care. We're definitely ripped off for the health care we get. But we also wouldn't need anywhere near as much healthcare if we embraced healthier lifestyles and had infrastructure and a social environment that supported it. Eating unhealthy foods needs to become as socially unacceptable as smoking.
TaxPhd, your statement, "minimum wage rates do not affect all labor compensation to some extent" is nonsense.
Lol!!
Instead of deleting the rest of my post that you responded you, you might want to address it, as it would help you to understand this topic a little bit better.
I’ll try again, let’s see if it helps you or not.
Quote:
A government mandated minimum wage below the market clearing equilibrium rate for a particular class of labor has no effect on that de-facto minimum wage. As an example, if the de-facto wage rate in a particular locale is $20/hour, a government mandated minimum wage of $12/hour has zero effect on the $20 de-facto minimum.
For your ridiculous contention to be correct, you need to demonstrate how the above is somehow wrong. Tell us all about how a government mandated minimum wage below $20 will affect not only the $20 de-facto minimum, but all other higher wages, as you have claimed.
The bottom line is that the demand, or lack thereof, for labor will be what drives the de facto minimum wage.
Every fast food place I see has "now hiring" signs. If the employers had tons of candidates, they wouldn't need to pay the $12/hr.
The real squeeze isn't at the bottom. It's the jobs slightly above - think about something like a CNA or call center worker - who might be just a few dollars an hour above the very bottom. Would you rather ring up groceries at Aldi or wipe butts for the same wage?
Lol!!
Instead of deleting the rest of my post that you responded you, you might want to address it, as it would help you to understand this topic a little bit better.
I’ll try again, let’s see if it helps you or not. For your ridiculous contention to be correct, you need to demonstrate how the above is somehow wrong. Tell us all about how a government mandated minimum wage below $20 will affect not only the $20 de-facto minimum, but all other higher wages, as you have claimed.
TaxPhd, I responded to your post's sentence, “EduardoFinatto, minimum wage rates do not affect all labor compensation to some extent”.
Our Government's minimum wage rates do affect all of our labor compensations to some extents. Need I explain the concepts of wage-rate differentials to you?
With good reason I disregard your sentences and example that followed, “A government mandated minimum wage below the market clearing equilibrium rate for a particular class of labor has no effect on that de-facto minimum wage. As an example, if the de-facto wage rate in a particular locale is $20/hour, a government mandated minimum wage of $12/hour has zero effect on the $20 de-facto minimum”.
In the USA, for almost all employers, our governments' minimum wage rates are legally directly applicable to the least disirable employees, performong the least challenging tasks and/or tax least inconveinent or unpleasent tasks.
If your example of $12 minimum wage is applied to a marketplace where such such an employee for such a job is generally paid $20, then within that marketplace, the $12 minimum rate doesn't effectively affect any existing or potential employees. Do you know of such a marketplace for labor within the USA? Respectfully, Supposn
TaxPhd, I responded to your post's sentence, “EduardoFinatto, minimum wage rates do not affect all labor compensation to some extent”.
Our Government's minimum wage rates do affect all of our labor compensations to some extents. Need I explain the concepts of wage-rate differentials to you?
With good reason I disregard your sentences and example [of a $12/hour having "zero effect on the $20 de-facto minimum]. ... f your example of $12 minimum wage is applied to a marketplace where such such an employee for such a job is generally paid $20, then within that marketplace, the $12 minimum rate doesn't effectively affect any existing or potential employees. Do you know of such a marketplace for labor within the USA? Respectfully, Supposn
TaxPhd, here's 3 of my posts to this thread explicitly pointing out to the extents minimum wage rates are insufficient, (i.e. have not kept abreast with the purchasing power of the U.S. dollar), they less effectively serve their purposes. Respectfully, Supposn
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08Mar2024, TaxPhd,... Increases of prices both contribute and are due to the U.S. dollar's reduced purchasing power. … Few if any credible economists are advocating enterprises be prohibited from increasing prices. Why should U.S. governments not annually adjust their minimum wage rates to be reconciled with the dollar's purchasing power?
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06Mar2024, NDak15, our federal minimum wage rate (to some extent) prevents lower wage states from undermining the labor markets of other states in the USA. To the extent that the federal minimum is an insufficient wage rate and is not kept abreast with the purchasing power of the U.S. dollar, it fails to fully support our national and our individual states' wage rates. ...
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04Mar2024, Ndak15,... To the extent that the federal minimum is an insufficient wage rate and is not kept abreast with the purchasing power of the U.S. Dollar, it fails to support our national and our individual states' median wage rates. …
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TaxPhd, I responded to your post's sentence, “EduardoFinatto, minimum wage rates do not affect all labor compensation to some extent”.
Our Government's minimum wage rates do affect all of our labor compensations to some extents. Need I explain the concepts of wage-rate differentials to you?
With good reason I disregard your sentences and example that followed, “A government mandated minimum wage below the market clearing equilibrium rate for a particular class of labor has no effect on that de-facto minimum wage. As an example, if the de-facto wage rate in a particular locale is $20/hour, a government mandated minimum wage of $12/hour has zero effect on the $20 de-facto minimum”.
In the USA, for almost all employers, our governments' minimum wage rates are legally directly applicable to the least disirable employees, performong the least challenging tasks and/or tax least inconveinent or unpleasent tasks.
Simply repeating what you’ve previously stated does nothing to bolster your argument. You throw ideas out with zero evidence to support those ideas. Then when challenged, you simply repeat what you’ve previously said. Multiple times. You are the one making these claims, the burden is on you to support those claims.
Quote:
If your example of $12 minimum wage is applied to a marketplace where such such an employee for such a job is generally paid $20, then within that marketplace, the $12 minimum rate doesn't effectively affect any existing or potential employees. Do you know of such a marketplace for labor within the USA? Respectfully, Supposn
In my locale, the de-facto minimum wage is $18 (and has been for several years). Federal minimum wage is $7.25. And it has zero effect on the de-facto minimum wage, nor does it have any effect on jobs that are paying more than that de-facto minimum (despite your contrary assertion).
At the beginning of 2024, my state raised the state minimum wage to just over $10/hour. What effect did that have on the de-facto minimum wage (and all higher wages, as is your claim)? Nothing. Zero effect.
This situation (a de-facto minimum wage that is higher than a government mandated minimum wage) is not unique to my locale, it is occurring around the country.
The linked graph below illustrates this situation (a government mandated minimum wage below the de-facto minimum wage). Anyone who has taken an introductory course in micro econ should be able to immediately understand what the graph illustrates, and understand why a government mandated minimum wage below the de-facto minimum wage will zero effect. And it in will fact continue to have zero effect unless and until the government mandated minimum wage exceeds the de-facto minimum wage. If you take a micro Econ course, you will be able to understand it as well.
(The solid green line in the graph represents the government minimum wage)
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