At the price "Americans" would do these jobs, the companies may not be able to earn a profit.
Because, otherwise, they probably would do just that.
Because, otherwise, they probably would do just that.
How much people are willing to pay for a service is connected to the value labour generates. If the minimum wage for cleaning was raised to $50/hour, many cleaning companies would close because few people were willing to pay at least $50/hour for a cleaner; the work done by the cleaner does not generate $50/hour of value. For any given individual at any point on time there is a ceiling on how much value they can generate, based on their knowledge and abilities. If somebody is capable of generating $10 of value, and the minimum wage is raised to $20 of value, anybody employing them would be losing $10/hour (paying $20 for $10 worth of labour). In which case it becomes much harder for that individual to find a job, and also to get a foothold for them to gain skills and experience that allow them to generate more value in future.
You might argue that such a worker is better off on welfare or some kind of basic income, but shouldn't that be their choice to make, not yours?
It's how much the market will bear. Business owners (shareholders) play a game of arbitrage between what people will pay for the service and the cost of producing the service (e.g. labor costs). I think folks are upset not so much at the cleaning services of the world, but the oligopolies, where you soak up the surplus value of the labor. Sometimes it's done illegally like in the wage collusion case in silicon valley, other times it's done legally through M&A. The wealthy have learned how to leverage their position for maximum profit, and many folks see it for what it is.
These aren't the companies that minimum wage laws hurt. According to https://www.businessnewsdaily.com/5314-entrepreneur-salaries..., the average salary of small business owners in America is $68,000, which is much less than most software developers on this site seem to make. They're not exactly filthly-rich businesses gobbling up profit. Even a small increase in costs can be enough to put them out of business, leaving their employees jobless.
The industries or professions where "living wages" is an issue are usually not the ones desperate for labor.
Killing such such companies doesn't magically create new companies able to pay more, it just converts their low-paid workers to unemployed workers. The minimum wage is always zero (no job).
At the bottom of the wage spectrum that's mostly not true. Profits would allow for higher wages, but the negotiating power of the employers is such that they can hold wages down. In these cases minimum wages do make sense and don't result in higher unemployment. And implementing minimum wage laws has shown that it does not affect unemployment in a big manner.
And honestly, if you are competing with a 16 year old for a job, there are larger issues than the minimum wage.
Maybe the real answer is to make it easier for adults to get training for jobs that can’t be done by a 16 year old.
Something tells me you would be perfectly happy if wages were kept super low, and the other things you said did not happen.
That is not a solution.
If you don’t think that businesses don’t “deserve” to exist if there business model can’t be profitable at “livable wages” that seems hypocritical to me since a lot of techies work for companies that only exist because of VC funding and if their company had to exist based solely on profitability they wouldn’t be working either.
In an economy with high unemployment, a minimum wage should be lower. With low unemployment, it can be higher in order to put a lower limit on the employers' negotiating power.
If the numbers don’t make sense, either the employer is going to automate or capital os going to move up market and to jobs that are out of reach for the unskilled.
If Apple bought iPhone manufacturing to the US for instance where it would be more expensive, they would invest in ways to automate more before they would hire the same number of people as FoxConn does.
It looks like wage increases are less of a factor in automation than labor shortages. Which is why Foxconn in China is automating like crazy.
Most of the time the teenager is either getting a hand me down car from the parents and the parents buy a new car or they buy their kid a cheap car.
My son won’t be going to an expensive college. He will be going to a two year state school close to home, living at home and then transferring. We will be paying cash.
And, maybe unfortunately, given some due diligence, that decision is still most likely the correct one. And yes, there are fraudulent schools and diminishing returns etc.
But the popular refrain on HN - which I don’t agree with - is that the purpose of college is not to get a job.
So minimum wage is an entirely different topic. Increasing minimum wage will not solve any hiring problems, it only bolsters negotiation power for those at the bottom. Which is a good thing, but no solution to the stated problem.
"well yeah but the workers consented "
People do a lot of things when desperate, that shouldn't inform how we design our society
Jeeeeeesus christ, how am I designing how they spend their time?
How can you detect lack of freedom in saying "you can't work for unlivable salaries" but not in "I only pay unlivable salaries because if you dont want these crubs there's other more desperate people".
> Ultimately the worker is payed by the company's customers,
No, no, they are paid by the owners who decide what slice of the income to allocate to salaries. The customers pay the product and walk away, they don't know anything about the internal workings of a company
>and if the law asks consumers to pay more than they're willing to pay for the workers' service,
The law asks the boss to pay livable salary, the end price has nothing to do with the law. If the service cannot be offered at competitive prices while offering livable wages, it's not a sustainable business
They want to do some job for money and you're telling them "no, it pays too little, you're not allowed to do that job, you should be on welfare or find another job instead!".
>No, no, they are paid by the owners who decide what slice of the income to allocate to salaries. The customers pay the product and walk away, they don't know anything about the internal workings of a company
The income of the company is connected to the value generated by the workers it employs. An owner of a law firm can pays its employees much better than an owner of a fast food restaurant, because people are willing to pay more for lawyers than they are for fast food service. If the law forced restaurant owners to pay their workers as much as a law firm has to pay its workers, most restaurants would go out of business because people simply aren't willing to pay as much for restaurant service as they are for lawyers.
>The law asks the boss to pay livable salary, the end price has nothing to do with the law. If the service cannot be offered at competitive prices while offering livable wages, it's not a sustainable business
The maximum salary someone can expect is proportional to how much value they can generate for people. If the law requires someone to be paid much more than the maximuim amount of value they can generate given their skills/abilities at the time, then people will simply choose to forgo that service. If you had to pay someone $200/hour to clean your windows, would you do that, or would you clean them yourselves / let them remain uncleaned?
Minimum wage laws don't create jobs; the minimum wage is always zero (if nobody thinks someone can produce enough value to justify paying them the minimum wage, nobody will pay/hire them). Feel free to declare low-paying jobs "unsustainable", but note that the alternative to such jobs in many cases isn't livable wages, it's no wages, or welfare.
The idea that they need to be on some form of welfare ANYWAY doesn't bother you ?
> If the law forced restaurant owners to pay their workers as much as a law firm has to pay its workers, most restaurants would go out of business because people simply aren't willing to pay as much for restaurant service as they are for lawyers.
And if the southern states couldn't have slaves the economy would collapse and if people could strike, no business can survive and if you have to pay immigrants the same salary as locals, no business can survive and if they pass anti-sweatshop laws , no business can survive and if you can't fire them for unionizing , no business can survive and if you can't hire children , no business can survive and if you pay them for ONLY 40h per week , no business can survive and if you pay women equally , no business can survive
it has been the same excuse forever, if we give rights the market will crash, and yet every time instead of crushing it just keeps blooming... weird.
Unless they want to live on subsistence, they need things produced by other people. They can either do something for other people (employment) in exchange for other people's things (usually in the form of money, which is more efficient than barter), or they can receive some form of charity/welfare from other people. What's wrong with it? Why should it bother me that the universe doesn't have an infinite source of everything such that anybody can fill all their wants without anybody having to work?
>it has been the same excuse forever, if we give rights the market will crash, and yet every time instead of crushing it just keeps blooming... weird.
Just because everything hasn't completely collapsed that doesn't mean things couldn't be better. That's like arguing polluting the environment is fine because the planet's still alive now. You can see this by comparing for instance Eastern Europe to Western Europe; Eastern Europe didn't collapse, but due to bad economic management it grew a lot more slowly and produced much lower living standards for its inhabitants than Western Europe.
And you are right, higher prices lead to less consumption.
Basically any employee contract is a cooperation between two parties leading to a shared benefit of that cooperation. How that benefit is partitioned between the two parties is a matter of negotiation and negotiation power.
Wages below a certain standard of poverty are a different issue, and those aren't the jobs with hiring problems anyway.