Minimum wage: how much is too much?

[steve-in-kville]

Copied from here:

https://lancasteronline.com/business/lo ... b7dcd.html
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Small businesses continue to struggle with the impact of the pandemic, particularly when it comes to finding the workers they need to get back to normal.

Local business owners were on hand Wednesday at the Lancaster Chamber for a state Senate hearing on the economic impact of the workforce shortage.

Most of the testimony was about having the government less involved in the marketplace, particularly when it comes to the $300 weekly federal bonus some of the business owners said is making it harder to recruit and gives would-be workers inflated expectations about pay.

Members of the Community, Economic & Recreational Development Committee also heard ideas for how state government could do more, including subsidizing job training for new hires, using leftover federal grant money to replenish a state fund for hotels and restaurants, and making it easier for restaurants to offer health insurance and use that a recruiting tool.

“We’re struggling to figure out how we pay fair wages when the perception of wages has changed so drastically,” said Diesha Cooper, an owner of D. Cooper Works, a metal fabrication shop in Ephrata.

Cooper said a $15-an-hour entry-level wage is no longer seen as generous even though it’s essentially paid during an employee’s training period when their work doesn’t earn money for the firm. Since she would be strapped to boost wages even more, she suggested funneling money from unemployment payments to a training subsidy for new hires.

Mark Sauder, president of Sauder’s Eggs, said the state should offer more support to trade schools that train the kinds of employees the Lititz firm needs, especially since it costs a lot to pay employees while they learn on the job.

“I don’t need any direct money from the government,” Sauder said. “Let’s give people the opportunity to grow their skills and earn higher wages.”

Testifying about the challenges facing the restaurant industry, James Longstreet, president and CEO of the Pennsylvania Restaurant & Lodging Association, said many restaurateurs went into debt to stay afloat during the pandemic, suggesting unspent federal funds be used replenish Pennsylvania’s COVID-19 Hospitality Industry Recovery Program, which awarded $145 million in grants to hotels and restaurants.

Longstreet also said restaurants might have better luck hiring workers if they could obtain health benefits for employees through association health plans, which could offer better rates and manage plans for restaurants. Legislation allowing such joint buying programs is currently pending.

Yet even as some fixes were proposed to aid recruiting and employee training, restaurant owner Mick Owens described a situation in which even generous incentives don’t seem to be enough.

Owens, who owns three Mick’s All American Pubs and one Maize Mexican Cantina in Lancaster County, said he hasn’t been able to hire even one cook so far for a planned new Mick’s in Lebanon, even though he’s offering $18 an hour, double what he paid before the pandemic.

“We’ve had times when it’s tough to find employees, but never like this,” he said.

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How much is too much for a starting wage? Would like to see some discussion on this. I know we have a handful of employers here on MN.

[PeterG]

I saw this just yesterday.

[temporal1]

Real life: Saturday evening, small informal pizza place, Seattle area:
3 - 8” pizzas
1 shared nachos
1 beer
2 waters
$69+tip

We feared a line to get in. No line, few customers seated. (Seating for 100-ish.) Lots of empty tables.

i was astonished, my family assured me, “this is normal.” dessert would add another $60.

unemployment has been paying well!

[Neto]

Reminds me of how I've seen whole cultures wrecked when government giveaway programs pump money into minority tribal cultures. They end up creating societies whose members have no incentive to work or earn anything on their own efforts.

I am talking about isolated tribes in Brazil, but thankfully they hadn't ruined the Banawa. The Banawa were by contrast extremely responsible in respect to just assuming that they would work for whatever they felt they needed. Not that we didn't often give them things, especially medical supplies, which were always free to them, even when we had purchased the supplies ourselves. (The government health organization DID supply lots of free medical supplies for us to use there.)

[steve-in-kville]

I know a lot of companies in our area found out the hard way they can't pay the "mennonite minimum wage" any more. Gotta be competitive.

[temporal1]

Reminds me of how I've seen whole cultures wrecked when government giveaway programs pump money into minority tribal cultures. They end up creating societies whose members have no incentive to work or earn anything on their own efforts.

I am talking about isolated tribes in Brazil, but thankfully they hadn't ruined the Banawa. The Banawa were by contrast extremely responsible in respect to just assuming that they would work for whatever they felt they needed. Not that we didn't often give them things, especially medical supplies, which were always free to them, even when we had purchased the supplies ourselves. (The government health organization DID supply lots of free medical supplies for us to use there.)

i dread the near future.
because of gov stimulus funds, this past year has been a bit easier for me on Soc Sec. a breather.

HOWEVER, many prices have increased, while quality+availability of products+services has decreased. what happens when extra gov funds end, AND cost of living is up??! i barely got thru before. evidently, many received far more than i did. what will they do?

a world of hurt may soon be upon us.

[temporal1]

I know a lot of companies in our area found out the hard way they can't pay the "mennonite minimum wage" any more.
Gotta be competitive.

This always depends on what unnamed discounts+benefits might be gained by the discounted min wage.
It can be tricky to see the overall Cost of Living picture.

We lived in one small community that, on paper, appeared less affluent than others in the county.
In process of living there, we realized there were various local lower prices and higher quality that easily offset the gap.
Not a Mennonite community.

Personally, i prefer lower COL over higher stated income. [What is the NET income?]
Higher incomes definitely equate to increased TAXES.
Some lose gov benefits as incomes increase: most hate that. they want both! big problem with incentives+attitudes.

[Ken]

Well, the article in question has nothing to do with the minimum wage. A quick bit of googling tells me that the PA minimum wage is $7.25/hr. while the article is talking about wages in the $15/hr. range.

As for what is an appropriate "starting wage?" Starting wage for who? Only a small portion of the workforce is unskilled entry level workers.

Luckily we have a relatively free labor market compared to many other countries so I suspect we will find out what the market determines to be an appropriate starting wage.

[joshuabgood]

By the looks of things (Bezos et al), Amazon could actually afford to pay a little more.

[RZehr]

By the looks of things (Bezos et al), Amazon could actually afford to pay a little more.

Yes, a little more. According to my math, which could be off, Amazon could give each of their employees and contractors about a $1.55 per hour raise, and that would take their net income to $0.
This is using their most recent record net profit numbers, which were up 200%+ from the prior year.