On Tuesday, August 4, 2015 at 2:41:02 PM UTC-4, Ed Huntress wrote:



Total wage/salary labor runs from 18% of operating costs
(retail/wholesale trade) to 52% (healthcare). I averages under 30%
across the economy. Don't confuse this with "total workforce costs,"
which include hiring/replacement costs and many other factors that
have nothing to do with workers' salaries or wages.

Meantime, roughly 4.3% of US workers make minimum wage or less. So,
you double their wages, you're looking at 0.043 x 0.30, or roughly
1.3% increase in total operating costs.

Only if you use the simplest sort of reasoning. Doubling the minimum wage will mean that those who earn a little above the minimum wage will get raises so the still earn a little above minimum wage. You do want to hire the best employees. So you have to pay a bit above the minimum wage to be able to select those that come to work as scheduled , etc. So your analysis is WRONG.

That does not include capital costs, which vary by industry, but which
can be high, and which further diminish the effect on costs of
doubling the minimum wage.

Capital costs are things as buildings. Well guess what carpenters will get more money if the minimum wage is increased. So capital costs will be higher.


So what do you get by doubling the minimum wage? A cost effect that is
somewhere between 1% and 1.3% to the economy. Meantime, you've
increased the purchasing power of 3.3 million workers and reduced the
burden on social services (especially food stamps) that they
represent.

Your simple analysis fails to recognize that raising the minimum wage raises all labor costs.


How does it come out in the wash, in straight economic terms and
disregarding the sociel effects? You tell me. I don't know. Nobody
knows. There are commissions made up of reputable economists trying to
figure it out. And if anyone tells you that he knows, there's only one
thing that YOU will know: That he's full of ****.


And anyone that says raising the minimum wage will only affect those that make the minimum wage are also full of ****. Either that or everything I learned in economics is false.

Dan
--
Ed Huntress

On Tue, 4 Aug 2015 14:10:41 -0700 (PDT), "
wrote:

On Tuesday, August 4, 2015 at 2:41:02 PM UTC-4, Ed Huntress wrote:



Total wage/salary labor runs from 18% of operating costs
(retail/wholesale trade) to 52% (healthcare). I averages under 30%
across the economy. Don't confuse this with "total workforce costs,"
which include hiring/replacement costs and many other factors that
have nothing to do with workers' salaries or wages.

Meantime, roughly 4.3% of US workers make minimum wage or less. So,
you double their wages, you're looking at 0.043 x 0.30, or roughly
1.3% increase in total operating costs.

Only if you use the simplest sort of reasoning. Doubling the minimum wage will mean that those who earn a little above the minimum wage will get raises so the still earn a little above minimum wage.

Probably true. You can add 2.7 million to the 3.3 million if you want
to include those who make between minimum and $10.10 (which is the
realistic figure, if it comes to a federal minimum). The number is
still absurdly small -- you're up around 2% with your addition -- if
you consider it to be support for your point.

You do want to hire the best employees. So you have to pay a bit above the minimum wage to be able to select those that come to work as scheduled , etc. So your analysis is WRONG.

Here's where that argument breaks down:

If you're paying the minimum wage and you want to be able to select
the better employees, you pay them more. If the minimum wage is
increased, you still have to pay those same employees more.

The proportions of who is paid minimum, versus more, remains the same.
The numbers of people involved are the same. So the numbers and
proportions who are paid minimum or more does not change. The effect
is the same; any increase in labor costs that result from paying more
for good employees, now, will be the same as those that result from
paying more for good employees when the minimum wage is increased.

Net zero.



That does not include capital costs, which vary by industry, but which
can be high, and which further diminish the effect on costs of
doubling the minimum wage.

Capital costs are things as buildings. Well guess what carpenters will get more money if the minimum wage is increased. So capital costs will be higher.

The total number of construction workers who make minimum wage or less
is 37,000, says the Labor Dept. That's 0.8% of total paid hourly
employees in construction. Dan, get serious.

http://tinyurl.com/nr6dj63 (page 8)



So what do you get by doubling the minimum wage? A cost effect that is
somewhere between 1% and 1.3% to the economy. Meantime, you've
increased the purchasing power of 3.3 million workers and reduced the
burden on social services (especially food stamps) that they
represent.

Your simple analysis fails to recognize that raising the minimum wage raises all labor costs.

It doesn't. It only raises costs for 4.3% of workers. You can look at
average labor rates across the economy, and see what happens to total
labor costs when you double the rate on the lowest 4.3%. The amount is
trivial.



How does it come out in the wash, in straight economic terms and
disregarding the sociel effects? You tell me. I don't know. Nobody
knows. There are commissions made up of reputable economists trying to
figure it out. And if anyone tells you that he knows, there's only one
thing that YOU will know: That he's full of ****.


And anyone that says raising the minimum wage will only affect those that make the minimum wage are also full of ****.

See above.

Either that or everything I learned in economics is false.

No comment. g

--
Ed Huntress

On Tuesday, August 4, 2015 at 11:12:11 PM UTC-4, Ed Huntress wrote:






There's no reason that people making significantly more than the new
minimum will be paid proportionally more. They won't. Above a low
threshhold, they probably won't be paid any more at all. There will be
no pressure to do so.


Why do the people making significantly more than the minimum wage get paid what they now get? When you answer that question we can argue what the effect of a minimum wage increase.



On the other hand, if you're making $40 at the time the minimum wage
is raised, you'll have to suck it up. New hires aren't making anywhere
near what you're making. You'll have no argument.


New hire engineers are getting about $40 an hour. Engineers with experience are getting more.

You need to think why those making $40 an hour are getting $40 an hour. When you understand that , you will see it is because it is based on getting proportionally more than the minimum wage.

Your simple analysis fails to recognize that raising the minimum wage raises all labor costs.

It doesn't. It only raises costs for 4.3% of workers. You can look at
average labor rates across the economy, and see what happens to total
labor costs when you double the rate on the lowest 4.3%. The amount is
trivial.

WRONG. Try thinking. Why to engineers get the salary they get? It is supply and demand. They get a high multiple of the minimum wage because there is a limited supply and a good demand. Raising the minimum wage will not change that. They will continue to get the same multiple of the minimum wage. Because the demand and supply dictate what the salaries are.

There is no reason to believe a word of that. What would change the
supply/demand equation that produces the current salaries? What would
be the pressure to increase their salaries?


As you say, Dan, think.

I have. Now it is your turn.






Either that or everything I learned in economics is false.

No comment. g

Just remember my econ prof was Kenny G.

Dan

--
Ed Huntress

On Wed, 5 Aug 2015 04:41:59 -0700 (PDT), "
wrote:

On Tuesday, August 4, 2015 at 11:12:11 PM UTC-4, Ed Huntress wrote:






There's no reason that people making significantly more than the new
minimum will be paid proportionally more. They won't. Above a low
threshhold, they probably won't be paid any more at all. There will be
no pressure to do so.


Why do the people making significantly more than the minimum wage get paid what they now get?

Supply and demand.

When you answer that question we can argue what the effect of a minimum wage increase.

It will be simple to discuss, because an increase in the minimum wage
will have no effect on the supply or demand for higher-paid engineers.




On the other hand, if you're making $40 at the time the minimum wage
is raised, you'll have to suck it up. New hires aren't making anywhere
near what you're making. You'll have no argument.


New hire engineers are getting about $40 an hour. Engineers with experience are getting more.

Then there's no problem. They're already getting more.


You need to think why those making $40 an hour are getting $40 an hour. When you understand that , you will see it is because it is based on getting proportionally more than the minimum wage.

You probably know this, but you're arguing the old theory of "relative
deprivation," which is a very weak argument. It collapsed along with
the argument for pay by seniority. That's broken down in most of
private enterprise. Only in the few remaining strongholds of
traditional unionism does it persist.


Your simple analysis fails to recognize that raising the minimum wage raises all labor costs.

It doesn't. It only raises costs for 4.3% of workers. You can look at
average labor rates across the economy, and see what happens to total
labor costs when you double the rate on the lowest 4.3%. The amount is
trivial.

WRONG. Try thinking. Why to engineers get the salary they get? It is supply and demand. They get a high multiple of the minimum wage because there is a limited supply and a good demand. Raising the minimum wage will not change that. They will continue to get the same multiple of the minimum wage. Because the demand and supply dictate what the salaries are.

There is no reason to believe a word of that. What would change the
supply/demand equation that produces the current salaries? What would
be the pressure to increase their salaries?


As you say, Dan, think.

I have. Now it is your turn.

If you've thought about it, you should be able to answer my question:
What effect would raising the minimum wage have on the supply/demand
ratios for engineers, who are making far more than the minimum wage?

--
Ed Huntress







Either that or everything I learned in economics is false.

No comment. g

Just remember my econ prof was Kenny G.

Dan

--
Ed Huntress

On Wednesday, August 5, 2015 at 8:56:29 AM UTC-4, Ed Huntress wrote:


It will be simple to discuss, because an increase in the minimum wage
will have no effect on the supply or demand for higher-paid engineers.


You are wrong and should understand because you were going to be an engineer when you started college. When there are lots of jobs that do not require as much effort to learn , lots of people opt to not study as hard and not get an engineering degree. So when the minimum wage increases fewer people study engineering and the supply of engineers goes down. That is followed by a shortage of engineers and an increase in salaries for engineers.


On the other hand, if you're making $40 at the time the minimum wage
is raised, you'll have to suck it up. New hires aren't making anywhere
near what you're making. You'll have no argument.


New hire engineers are getting about $40 an hour. Engineers with experience are getting more.

Then there's no problem. They're already getting more.

You need to explain how you came to this opinion.

You need to think why those making $40 an hour are getting $40 an hour. When you understand that , you will see it is because it is based on getting proportionally more than the minimum wage.

You probably know this, but you're arguing the old theory of "relative
deprivation," which is a very weak argument. It collapsed along with
the argument for pay by seniority. That's broken down in most of
private enterprise. Only in the few remaining strongholds of
traditional unionism does it persist.

Not true. It exists at all levels. Explain why CEO's get high salaries and other benefits.


Your simple analysis fails to recognize that raising the minimum wage raises all labor costs.

It doesn't. It only raises costs for 4.3% of workers. You can look at
average labor rates across the economy, and see what happens to total
labor costs when you double the rate on the lowest 4.3%. The amount is
trivial.

WRONG. Try thinking. Why to engineers get the salary they get? It is supply and demand. They get a high multiple of the minimum wage because there is a limited supply and a good demand. Raising the minimum wage will not change that. They will continue to get the same multiple of the minimum wage. Because the demand and supply dictate what the salaries are.

There is no reason to believe a word of that. What would change the
supply/demand equation that produces the current salaries? What would
be the pressure to increase their salaries?


Answered above. The supply of engineers varies with how easy it is to get a well paying job.

As you say, Dan, think.

I have. Now it is your turn.

If you've thought about it, you should be able to answer my question:
What effect would raising the minimum wage have on the supply/demand
ratios for engineers, who are making far more than the minimum wage?

As I said , if you can earn a good living without the effort needed to become an engineer, then the supply of engineers drops.
--
Ed Huntress







Either that or everything I learned in economics is false.

No comment. g

Just remember my econ prof was Kenny G.

Dan

--
Ed Huntress