Quote:
Originally Posted by Millburn
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Thank you for explaining that.
So with that in mind, how does the fact that productivity has been going up and up but wages haven't. Shouldn't wages keep in alignment with productivity, does that not translate to what you were talking about?
http://www.nytimes.com/2013/01/13/su...nate.html?_r=0
I mean obviously there's a difference between corporations and small businesses, but the majority of minimum wage jobs at least in my area of the world come from these large retailers where a raise in minimum wage seems justified due to the disparity between productivity and their paycheck. |
Hmm, I don't think I can sufficiently answer this question, as there are a lot of variables to examine. However, note the article mentioned increased outsourcing of jobs as a problem, and I doubt they are including wages paid to outsourced jobs, even though the outsourced jobs would contribute to the productivity increases. If minimum wage is raised even higher, this would be an even bigger problem.
To your example of the retailer, is it the menial employee who is greatly contributing to the increased productivity? Most likely not, as I'd wager that they are getting paid close to what they're worth. If minimum wage were raised, you might only have 50 employees at the stores as opposed to 55 or 60.
A welfare state doesn't help the situation either, as the opportunity cost of not working to someone who is receiving welfare (assuming they'll even make more working than just being on welfare) is considerably reduced, so they are essentially working for pennies an hour as opposed to the $10/hour or whatever minimum wage is.