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aGameOfThrones
02-05-2014, 10:27 PM
The Meanies:


Dolores Riley has many questions and few answers. Along with every other employer in New Jersey, she woke up on New Year’s Day to a new minimum wage — $8.25 an hour, up from $7.25. Even before the increase, Ms. Riley, who owns Gramma’s School House Childcare and Learning Center in Cinnaminson, had been operating on the razor’s edge.

Since 2008, the number of children her company cares for has dropped to 40 from 75, reducing her annual revenue to $350,000 from $600,000 and forcing her to cut her own salary 75 percent. In business since 2000, Ms. Riley said she paid all of her 16 employees more than minimum wage — her lowest-paid workers make $7.75, the highest $15 — but she fears that increasing the minimum will force her to raise everybody’s pay to maintain her structure.

The latest increase, she said, is likely to add $10,000 to $15,000 a year to payroll costs that already make up nearly 80 percent of her operating expenses. “This really scares me,” she said. “I hope I don’t have to close.”

Ms. Riley said her options were limited. She has already laid off nine employees in recent years. Having raised her rates two years ago, by $5 a week, she is reluctant to do so again — especially since it would take an increase of $30 a week per child, to $255 from $225, to cover the increased wages. That, she said, would cause many of her clients to withdraw their children and rely instead on less expensive (and unregulated) babysitters.

Like Ms. Riley, Charlene Conway is watching her numbers. For 22 years, Ms. Conway and her husband have run Carousel Family Fun Centers in Fairhaven and Whitman, Mass. The business has annual revenue of less than $500,000 and depends exclusively on part-time minimum-wage earners, mostly teenagers, to handle tasks like running the snack bar and maintaining the games.

This year, Massachusetts is considering raising its minimum to $9 an hour, from $8. Should that happen, Ms. Conway said, she will probably need to reduce her staff of 20. Her employees currently make an average of $9 an hour, with managers earning from $10 to $15. Like Ms. Riley, Ms. Conway said that an increase in the minimum would force her to raise pay across the board.

And she, too, is reluctant to raise prices again. In 2011 and 2012, she increased her admission fees by a dollar — they generally run from $5 to $10 now, based on age and time of day. Another increase, she said, would just make things worse: “We will price ourselves out of business.”

In the past, when Massachusetts increased the state’s minimum, Ms. Conway responded by increasing the minimum age of her workers to 16 from 14. “I’m not going to pay a 14-year-old $9 an hour with no experience, maturity or work ethic,” she said. More recently, she has been hiring 18-year-olds with college experience. “What this does,” she said, “is eliminate the opportunity for young people to get started in the work force.”

Should minimum wage reach $10 an hour, Ms. Conway said she would reduce her staff to 10 employees and double up on work tasks. “This is a slippery slope that could absolutely cause me to shut down and force me into bankruptcy,” she said.


The Givers:


But with income equality a political issue and with some studies challenging the notion that minimum-wage increases damage small businesses, there are also business owners who support the increases. These owners suggest that businesses actually benefit from paying higher wages because of reduced turnover and the additional money that goes into local economies.

Amanda Rothschild, co-owner of Charmington’s, a cafe in Baltimore, calls the arguments against raising the minimum “shortsighted.” Since opening in 2010, the cafe has paid new hires $8 an hour, more than the current $7.25 minimum (they also earn tips). “I think those against increases underestimate how business success is tied to employee satisfaction,” said Ms. Rothschild, who employs 11 people full time and three part time. She said her employees were part of the reason her cafe’s revenue increased to $600,876 last year, up 31 percent from $457,940 in 2012. She expects another increase this year.

Paying higher hourly wages was part of Charmington’s business plan from the start. “We felt that we would end up with more dedicated employees, who would be happier, and we found that to be true,” Ms. Rothschild said, adding that she had a 22 percent employee turnover rate, compared with a restaurant industry average of 50 to 75 percent. A stable staff, she said, helps productivity, saves her money on training and food waste, and leads to better customer service.

With Maryland looking to raise the state’s minimum to $8.25, Ms. Rothschild said she was considering several plans, including raising all base pay to $8.25 in preparation. She says she believes that it is possible to increase wages and still keep her payroll within 35 percent of operating costs without cutting hours, jobs or benefits. “I believe part of our costs in running a business includes investing in employees,” she said.

There are examples of small businesses that have made paying higher wages a cornerstone of their operations — and then grew much larger. Costco, for example, pays its hourly employees an average of $20.89 an hour (Walmart’s hourly workers make an average of $12.81). And when In-N-Out Burger, the California-based chain, opened in 1948 (the same year as McDonald’s), the minimum wage was 65 cents an hour but its founder, Harry Snyder, paid $1 an hour (plus one burger per shift).

Today, In-N-Out Burger pays a starting wage of $10.50 (McDonald’s pays on average $7.73 an hour by one estimate). It has close to 300 stores in five states (McDonald’s has more than 34,000 globally), and according to Technomic Inc., a research firm that centers on the food industry, it ranks second only to McDonald’s in revenue per location for fast-food chains.

http://www.nytimes.com/2014/02/06/business/smallbusiness/as-minimum-wages-rise-businesses-grapple-with-the-consequences.html?partner=yahoofinance&_r=0

Cutlerzzz
02-05-2014, 10:38 PM
Think of how satisfied they would be at $100.00 an hour.

DamianTV
02-06-2014, 03:47 AM
Whats really sad is most of the bleating sheep understand that increasing Minimum Wage to $100/hr, as mentioned, is not a good idea, but can not for the life of them explain WHY it is not a good idea.

tod evans
02-06-2014, 06:44 AM
Help me understand how it makes sense to work a minimum wage job full time instead of working a $25 hr job for 4 months out of the year?

DamianTV
02-06-2014, 06:50 AM
Help me understand how it makes sense to work a minimum wage job full time instead of working a $25 hr job for 4 months out of the year?

How about working 4 months out of the year for free by giving it all to the Govt? That makes a ton of sense too.

Todd
02-06-2014, 04:44 PM
Help me understand how it makes sense to work a minimum wage job full time instead of working a $25 hr job for 4 months out of the year?

Can you give me an example of a job that someone who works for Burger king might qualify for at this pay rate and time frame? My father in law who is very skilled in electrician can demand upwards of 30 an hour at nuclear power plants under a limited contract, but he is highly skilled and does so by traveling.

I just don't see this as realistic.

Icymudpuppy
02-06-2014, 05:17 PM
I cut all my employees loose. It's so much easier this way.

DamianTV
02-06-2014, 05:30 PM
Supply and Demand

When produce is out of season, it becomes more scarce, thus, the price goes up. When that same produce is in season, there is a larger supply of it, thus, price comes down.

The same idea can be applied to Workers as the product. Workers are readily available right now, and employers have the pick of the creme of the crop. Thus, workers are cheaper. Problem is that workers have become so cheap that workers arent able to afford to live on what they are paid. Its not the workers fault, or the employers fault. Inflation is quite high as is Unemployment. People are so desperate for jobs that they are willing to take what ever is available. Better jobs are even fewer and farther between. The workers know this. Upward mobility is damn near impossible. What the workers will see as the only solution is to get the wages of a highly skilled job from a service sector employer and cant see that by raising minimum wage, it only further drives the prices of everything else up to pay for it.

They think that applying Political Law to Economic Law will fix the problems of Economic Law, and it simply isnt so.

And for the record, Im not supporting Minimum Wage increases either. There are several EU countries that have no Minimum Wage at all. And those countries pay on average 1/3rd MORE than the other countries that DO have a Minimum Wage. Funny how that works, isnt it?

tod evans
02-06-2014, 05:36 PM
Can you give me an example of a job that someone who works for Burger king might qualify for at this pay rate and time frame? My father in law who is very skilled in electrician can demand upwards of 30 an hour at nuclear power plants under a limited contract, but he is highly skilled and does so by traveling.

I just don't see this as realistic.

Any of the trades pay a fair wage and most folks working at Burger King could apprentice in one of them if they had the ambition...

VIDEODROME
02-06-2014, 06:04 PM
What if..... both directions are unrealistic?

It's bad to think that raising the minimum wage to help the bottom level income earners won't have serious negative effects elsewhere. For example, with small business.

Yet, what if it is also bad to think that we'll do fine keeping the minimum wage low? Or what if we took the argument the other was and moved it down to $3 an hour? Except nobody can live on that. Yeah I know, McBurger places are not supposed to be a career, but what do you do if your unemployed, the benefits run out, and you have bills to pay?

I'm kind of wondering if both options suck equally for different reasons and we're screwed.

DamianTV
02-06-2014, 06:05 PM
Any of the trades pay a fair wage and most folks working at Burger King could apprentice in one of them if they had the ambition...

Or opportunity. Around here, we had a housing boom. During the boom, there were lots of jobs available for lot of different skills needed to build houses. Today, there are practically no houses being built, and the people that had those jobs have obviously lost them. A person may have the ambition to become a Finsihed Carpender, an Electrician, a Roofer, Painter, Plummer, etc, but without both the Opportunity and Ambition, people arent going to be able to work in their field of study. Result: College Grads flipping burgers and working at Walmarx as Greeters.

2young2vote
02-06-2014, 07:53 PM
Regarding the turnover rate - having an experienced, quality employee can be beneficial to sales, but I don't believe that benefit outweighs the added expense of an employee. The federal government (Obama) is proposing increasing the MW to $10.10 per hour, that is a 37% increase in labor costs. Is every employee going to increase their upselling by 37% because they now make more? No.

kcchiefs6465
02-06-2014, 08:25 PM
Any of the trades pay a fair wage and most folks working at Burger King could apprentice in one of them if they had the ambition...
It is hard to find apprenticeships anymore.

I would gladly work under someone whose skills I could benefit from. I wish to be well rounded in all aspects (from carpentry to electricity to welding to gunsmithing). Here may be different from where I was and I'll have to seriously make that effort to check. Where I was, there was no room for apprenticeship. There was/is a saturation of skilled workers. Welders making from $8.25 to $12.00 an hour because of a saturation in the market. Though if one was lucky, and skilled, $15-$20 was not too unheard of or if in a union/hired before the calamity and had seniority, $20+ wasn't unheard of.

Labor laws as well as many other factors have killed apprenticeships. Why pay me, who doesn't know shit about gunsmithing, the legally required wage? This of course ignores how utterly fucked up our country is. The cost to open a business or to sell something is so outrageous I cannot yet enter the market. It's absurd. I know I'm preaching to the choir but this needs to be considered. It isn't 50 years ago when out of high school you walked into Republic Steel or Timken and got a job. There's people twice my age with an incredible amount of more knowledge than I (at least with regards to said job). The only advantage I have, and I've met octogenarians with the same drive, is my work ethic.

This country is broken. And it keeps going more towards unfixable.