An introduction to the argument against the minimum wage

This information updates s. The main rules likely to affect voluntary organisations as employers are set out below, but this is only a superficial overview of a complex and constantly changing area of law.

An introduction to the argument against the minimum wage

This moral argument singles out employers as the morally responsible party in the living wage equation, even though the variables that determine a living wage go far beyond the wage earned.

For example, as I discussed herethe living wage is a function not simply of the wage, but of the cost of housing, food, health care, transportation, and a myriad of other factors. Where housing costs are low, for example, the living wage will be lower than it would be in a place where housing costs are high.

So, what matters is not the nominal wage paid by the employer, but the real wage as determined by the cost of everything that a wage is used to purchase.

Why Is Only the Employer Responsible? After all, wages, in real terms, could be increased greatly by forcing down food costs and rents.

So, why is there not a constant drum beat for grocers to lower their prices to make necessities affordable? Why are activists not picketing outside grocery stores for their high prices? Why are people not picketing used car dealers for not lowering their prices to make transportation affordable for working families?

An introduction to the argument against the minimum wage

And why are gas stations strangely exempted from protests over the high cost of gasoline? Certainly, all of these merchants are just as instrumental in determining real wages as any employer. And there are still plenty of activists who argue for price controls on rents and food.

The vast majority of voters and policymakers recognize that government-dictated prices on food and housing lead to shortages.

Setting a price ceiling on rents or home prices simply means that fewer housing units will be built, while setting a price ceiling on eggs, or milk or bread will simply mean that fewer of those staples will be brought to market.

Such assertions are barely even debated anymore, as can be seen in the near-extinction of new rent-control efforts in the political sphere. So, for whatever reason, homeowners, grocers, and others are exempt from the wrath of the activists for not keeping real wages low.

The employers, on the other hand — those who pay the nominal wage — remain well within the sights of the activists since, for some arbitrary reason, the full moral obligation of providing a living wage falls on the employer. Were food prices to go up by 10 percent in the neighborhood of Employer X, who is responsible?

After all, in their minds, it is only the employer who is morally obligated to bring up real wages to match or exceed an increase in the cost of living.

So while price controls on food, housing, and gasoline are generally recognized as a dead end, price controls on wages remain popular.

The problem, of course, as explained hereherehereand hereis that by setting the wage above the value offered by a low-skill worker, employers will simply elect to not hire low-skill workers.

A Low Wage Is Unacceptable, but a Zero Wage Is Fine And this leads to the fact that when faced with high wages, employers will seek to replace employers with non-human replacements — such as these automated cashiers at McDonalds — or other labor-saving devices.

But this phenomenon is simply ignored by the living-wage advocates. Thus, the argument that employers are morally obligated to not pay low wages becomes strangely silent in the face of workers earning no wage at all.

Indeed, we see few attempts at passing laws mandating that employers hire human beings instead of machines. Certainly, anyone making such an argument is likely to be laughed out of the room since most everyone immediately recognizes that it would be absurd to pass laws mandating that a road builder, for example, hire people with shovels instead of using bulldozers and paving machines.

Meanwhile, successes by living-wage advocates in other industries — where automation is not as immediately practical — have only been driving up prices for consumer goods. Yes, living wages in food, energy, and housing sectors will squeeze profits and bring higher wages for those who luckily keep their jobs, but the mandates will also tend to raise prices for consumers.

Background and introduction

This in turn means that real wages in the overall economy have actually gone down, thanks to a rising cost of living. It consists of raising the prices of consumer goods via increasing labor costs.Earlier this year, I calculated average salary estimates for the public and private sectors in Ireland.

The answer, that the average worker in the private sector earned €40, last year, almost €10, less than their public sector counterpart, has proved if not controversial than certainly a starting point for alphabetnyc.com some of the comments on that blog post, and the fact that the.

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Raising the Minimum Wage: The Arguments For and Against | CriminalWatchDog