"A living wage" is only fair, right? Everyone should make a 'living wage.' It's what employers everywhere in every industry should pay, gosh darn it. It's only fair. And $15/hour is the minimum anybody should be paid to do anything in the land of the Free and the home of the Brave. Period.
So wrong. Such a dumb mistake on oh so many levels.
I sincerely wish that we would teach just basic "Economics for Dummies" in high school, or perhaps even start in grade school. The curriculum in, say, 5th grade should include instructional techniques as to how to start up and run a lemonade stand. Going through the basics would underscore the nature of how things work in a capitalistic, market based economy.
And it would in the most simple terms underscore that everything has a price, and that when the price of virtually anything goes up (and we shall leave out the concept of price elasticity and in-elasticity for now), demand for whatever that is will go down. Simple economics. Simple display of human behavior.
Wages are nothing more and nothing less than the price of labor. And as sure as the sun rises in the east and sets in the west, if mandated minimum wages are arbitrarily set higher, then the demand for them (or employment) will fall. Unemployment will be the guaranteed result of raising the minimum wage to $15/hour.
In a true, correctly operating market driven economy, the inarguable minimum wage is $0.00 per hour. That is the going wage for somebody with absolutely no skills whatsoever. Now, once you train this no-skilled person, then their value goes up accordingly. But up to a $15/hour level? This is only true if their output makes their employer at least $25/hour in value. If not, then the employer is losing money, since they have to pay FICA, Medicaid, healthcare, etc. in addition to the $15.00 basic wage. And employers are not in business to lose money.
Human behavior is such that if this mandated minimum wage is raised to $15/hour, employers will not just sit back and eat this cut in their profit margins. They will either fire people, close businesses and simply leave the money they had invested in the business in their bank, or find other ways around the cost increase in their labor, perhaps through automation.
There is basic data available now from a decision made last year to jack up the minimum wage to $15/hr in Seattle, Washington: unemployment is up considerably in the 18-25 year old segment of the population.
But telling this to the $15/hour or 'living wage' crowd falls on deaf ears. Much to the detriment of their constituents.
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