Increasing the minimum wage

[ssiguy]

With Ontario, Alberta, and BC on their way to $15/hr in minimum wages, I am curious what you guys think of it.

I generally agree with minimum wage increases and do so with the $15/hour one but I am unsure of increasing the rate for restaurant servers to the same level. Restaurants that are already having problems filling kitchen staff positions are going to have a hell of a time keeping staff when servers will make the same wage plus their tips.

While part of me agrees that minimum wage should pertain to everyone, part of me also recognizes that servers NEVER make minimum wage but a very healthy amount over it yet usually do not work near as hard as kitchen staff. For many restaurants kitchen staff is like a revolving door due to the hard work and low wages while this is far less true for servers because they make substantially more for working less.

I know most servers have to put aside a percentage of their tips and/or food sales for kitchen staff but it works out to pennies on the dollar of what the servers make. I know a guy who was a manager at Montanas and then quit and `demoted` himself down to bartender and ended up making $1100 more a month for a fraction of the responsibility and this is going to be multiplied greatly when servers wages reach standard minimum wage.

All this said, is the very sudden and significant rises in the minimum wage a good thing in the first place? Thoughts?

[Franco401]

Before we start this argument, I'd like to point out to the idiots who'll inevitably come in here complaining about fast food workers getting the same money as firefighters, the remedy for that situation is to pay skilled workers even more, instead of bitching about poor people getting a living wage.

[J.OT13]

IMO, minimum wage should go up with inflation, and that's it. The sharp increase that we've seen over the last year caused businesses to close, jobs lost and reduced hours for many. In addition, prices have gone up, so this new "living wage" is no longer a living wage, and the rest of us are having a harder time with our average salaries (that haven't increased 30%+).


For those who live alone or are raising a family on minimum wage, I would support a government subsidy to top-off their salary. If we can afford well-fare for anyone who can't or will not work, we can top off the salaries of those who are working at a minimum salary and need a little extra to support themselves or a family.

[vid]

Originally Posted by ssiguy

Restaurants that are already having problems filling kitchen staff positions are going to have a hell of a time keeping staff when servers will make the same wage plus their tips.

While part of me agrees that minimum wage should pertain to everyone, part of me also recognizes that servers NEVER make minimum wage but a very healthy amount over it yet usually do not work near as hard as kitchen staff. For many restaurants kitchen staff is like a revolving door due to the hard work and low wages while this is far less true for servers because they make substantially more for working less.

I know most servers have to put aside a percentage of their tips and/or food sales for kitchen staff but it works out to pennies on the dollar of what the servers make. I know a guy who was a manager at Montanas and then quit and `demoted` himself down to bartender and ended up making $1100 more a month for a fraction of the responsibility and this is going to be multiplied greatly when servers wages reach standard minimum wage.

Why is this a responsibility of the government to sort out? A properly managed restaurant will identify and rectify this issue. It is part of the responsibility as manager of a business to manage (Key Word™!) the staff and dedicate payroll funds to each department appropriately.

I'm not willing to roll back social progress because Albert doesn't know who to manage line cooks.

[vid]

Originally Posted by J.OT13

IMO, minimum wage should go up with inflation, and that's it. The sharp increase that we've seen over the last year caused businesses to close, jobs lost and reduced hours for many. In addition, prices have gone up, so this new "living wage" is no longer a living wage, and the rest of us are having a harder time with our average salaries (that haven't increased 30%+).

First off, my salary did in crease 30%+ (38%, actually) and I was already making more than the existing minimum wage. As I said in the previous post: proper management of human resources is key. In one way I can actually understand what Doug Ford is saying when he says there is waste in government, but he's being very disingenuous about the solution: you do have to reduce staff, shuffle responsibilities around, reorganize how things are done and invest in capital. Fortunately for us, everyone that left either did so after finding a new job, or found a new job within days of leaving. I'm not sure if we can accomplish that after firing 100,000 public servants but on a small scale it seems to work; not only did no one become unemployed as a result of our re-organization but one of the businesses that two of them went to is now thriving with the skills they brought to that business. It's worked out for everyone. I can understand this won't always be the case but like I said, I have a hard time thinking of a business that has closed because it couldn't afford minimum wage hikes.

Second, the only businesses that I can think of that have closed in the past year, that aren't related to retirement or relocation of the sole-proprietor (this city has a chronic problem of not being able to pass businesses down to new owners), one was due to everything but minimum wage (he had one employee but a shitty location with no parking) and the other was due to an unpaid lease (it was a Subway franchise owned by a Torontonian). That one closed just before minimum wage went up last October so I don't think that was the problem?

Originally Posted by J.OT13

For those who live alone or are raising a family on minimum wage, I would support a government subsidy to top-off their salary. If we can afford well-fare for anyone who can't or will not work, we can top off the salaries of those who are working at a minimum salary and need a little extra to support themselves or a family.

Either way, it's going to be the backs of successful businesses and their employees who cover the cost of this, whether it's higher taxes to support a universal income top-up for low wage workers (ie., the state subsidizing a corporation that is unwilling to pay its employees for their work) or the offering of higher wages to its employees (adequate compensation for work, which is then taxed appropriately to generate revenue for government endeavours).

Originally Posted by Franco401

Before we start this argument, I'd like to point out to the idiots who'll inevitably come in here complaining about fast food workers getting the same money as firefighters, the remedy for that situation is to pay skilled workers even more, instead of bitching about poor people getting a living wage.

A million times, this.

Of course, if a fast food worker at $15/hour is making the same as a firefighter, they're putting in 128 hour work weeks which is 18 hours a day, 7 days a week. That's not exactly possible...

[WhipperSnapper]

$14/hour is still a stretch as a living wage in Toronto and that's one of the issues I have with a province wide minimum. You're trying to satisfy both apples and oranges. One ends up overpaid (not a big deal) while the other is still underpaid (the point of increasing the minimum is entirely lost) Another one was how the increase to $14 was handled in Ontario. Note: I can't offer a better solution however, it's a little too easy to dismiss businesses that struggled with the rapid increase as improper resource management. I had third party contracts that were 5 to 10 years long with a former business. Most of the larger contracts were volume contracts with slim margins. We would have lost money to pay labourers $1 to $3 more under those conditions and I know renegotiation wouldn't have gone in our favour either.

This is Canada too. It's easier to raise prices/cut staff than to finds saving in inefficiencies . Inflation will takeover in no time.

[MonctonRad]

Originally Posted by Franco401

Before we start this argument, I'd like to point out to the idiots who'll inevitably come in here complaining about fast food workers getting the same money as firefighters, the remedy for that situation is to pay skilled workers even more, instead of bitching about poor people getting a living wage.

Everyone will want more in order to maintain the relative pecking order. If everyone's wages take a big bump then inflation will surely follow.

Wage increases followed by price increases - it's a zero sum game.

[niwell]

Originally Posted by WhipperSnapper

$14/hour is still a stretch as a living wage in Toronto and that's one of the issues I have with a province wide minimum. You're trying to satisfy both apples and oranges. One ends up overpaid (not a big deal) while the other is still underpaid (the point of increasing the minimum is entirely lost) Another one was how the increase to $14 was handled in Ontario. Note: I can't offer a better solution however, it's a little too easy to dismiss businesses that struggled with the rapid increase as improper resource management. I had third party contracts that were 5 to 10 years long with a former business. Most of the larger contracts were volume contracts with slim margins. We would have lost money to pay labourers $1 to $3 more under those conditions and I know renegotiation wouldn't have gone in our favour either.

This is Canada too. It's easier to raise prices/cut staff than to finds saving in inefficiencies . Inflation will takeover in no time.

Yes exactly. $15 an hour in Toronto really isn’t that much. $15 an hour in rural Ontario is.

[hipster duck]

I support higher wages to adjust for the realities of our cost of living, but I also don't think that minimum wage jobs are meant to be long-term careers that support households. They're low and semi-skilled service jobs with irregular hours and shifts that are supposed to satisfy customer service demands in the service industry. For example, a shop or a cafe has to be open at 8pm or on weekends and so most shift workers employed by the business have to work an unpredictable quiltwork of irregular shifts that change from week to week.

Many of these shifts eat into time when they could be competing for a job that could be more permanent and career-building. For example, an employee at Starbucks might be expected to work on a Saturday and a Sunday but also a Monday and Tuesday from 6am-12pm. In that case, they are effectively taken out of the labour force that could compete for Mon-Fri 9-5 jobs - precisely the kind of jobs that they should be applying for if they want jobs with secure hours and the chance for upward mobility.

I would instead support legislation that pays shift workers who work during the "peak hours" of Monday to Friday 7am-7pm more than $15/hour, while paying workers who work outside of the normal workday hours a little less. This might also help adjust staffing levels to demand levels, since in a lot of retail and food jobs the peak hours for business and traffic are not during the middle of work days but on evenings and weekends.

I also support greater access to EI for people who are transitioning between jobs. If you live paycheck to paycheck, you might even be discouraged from switching jobs because you might have a pay gap between when you receive your last check and when you might receive your first paycheck from your new job.

[Xelebes]

Originally Posted by hipster duck

Many of these shifts eat into time when they could be competing for a job that could be more permanent and career-building.

To give a real example would be my younger brother. He ended up taking a graveyard shift that was a dollar or two higher than minimum wage before the minimum wage increases. He struggled to find time to look for work and so instead opted out of sleeping to hit the streets looking for work. He eventually committed suicide.

[vid]

Originally Posted by MonctonRad

Everyone will want more in order to maintain the relative pecking order. If everyone's wages take a big bump then inflation will surely follow.

Wage increases followed by price increases - it's a zero sum game.

Then why not go backwards? Let's dock everyone's wages equally. Every single working person will start getting paid 20% less tomorrow. Will we see deflation?

Originally Posted by Xelebes

To give a real example would be my younger brother. He ended up taking a graveyard shift that was a dollar or two higher than minimum wage before the minimum wage increases. He struggled to find time to look for work and so instead opted out of sleeping to hit the streets looking for work. He eventually committed suicide.

And who says capitalism doesn't kill?

[someone123]

Originally Posted by hipster duck

Many of these shifts eat into time when they could be competing for a job that could be more permanent and career-building. For example, an employee at Starbucks might be expected to work on a Saturday and a Sunday but also a Monday and Tuesday from 6am-12pm. In that case, they are effectively taken out of the labour force that could compete for Mon-Fri 9-5 jobs - precisely the kind of jobs that they should be applying for if they want jobs with secure hours and the chance for upward mobility.

Are people really stuck at Starbucks because they don't have time to look for the 9-5 jobs, or are they stuck because there aren't enough 9-5 jobs? I suspect the second factor is the bigger one.

I think the economy has much deeper problems and tweaks are unlikely to do much.

I would rather see a guaranteed income than a higher minimum wage. It could even be just a few thousand dollars per year at first. It has much better properties than either minimum wage increases or tested government transfers. People could still work and get a little more money even if the market price of their labour is only $7/hour, and there would be no bureaucratic gatekeeping with its high overhead and arms race.

Beyond that I think low quality jobs are the reality and will be the reality for a growing number of people in the future, so it would be good to reform labour laws so life is a little less miserable for those at the bottom of the market. For example, there should be more restrictions around scheduling and a lot more days off. Basic income would also make it possible for people to opt out of the most miserable jobs.

[someone123]

Originally Posted by MonctonRad

Everyone will want more in order to maintain the relative pecking order. If everyone's wages take a big bump then inflation will surely follow.

Wage increases followed by price increases - it's a zero sum game.

This is too simple to be a convincing argument.

Will you really expect or notice a $4/hour raise if minimum wage goes up? Do you want to see the same dollar increase (per hour worked? per year?) or the same proportion relative to someone at McDonald's? Do you know what those would be? How many people earn minimum wage? It is only a portion of the work force, and wages only account for a portion of the money in the economy. What about the jobs that are lost due to the increase? What about places that have minimum wage workers but spend only a tiny fraction of their money on labour?

It's hard to know exactly what would happen but I think the sum is more like:
- Minimum wage employees whose value is known to be less than the new minimum and can be fired will be fired and become unemployed. Net decrease in standard of living unless something else kicks in. Note that many of these people will be unemployed in the future anyway due to automation.
- Minimum wage employees whose value is higher will get the new wage. Net increase in standard of living, though they may also be let go in the future due to automation.
- Some businesses pass costs on and others don't, depending on vagaries of the different markets or non-markets
- There is overall inflation but it's highly uneven and not very noticeable

[J81]

Originally Posted by someone123

This is too simple to be a convincing argument.

Will you really expect or notice a $4/hour raise if minimum wage goes up? Do you want to see the same dollar increase (per hour worked? per year?) or the same proportion relative to someone at McDonald's? Do you know what those would be? How many people earn minimum wage? It is only a portion of the work force, and wages only account for a portion of the money in the economy. What about the jobs that are lost due to the increase? What about places that have minimum wage workers but spend only a tiny fraction of their money on labour?

It's hard to know exactly what would happen but I think the sum is more like:
- Minimum wage employees whose value is known to be less than the new minimum and can be fired will be fired and become unemployed. Net decrease in standard of living unless something else kicks in. Note that many of these people will be unemployed in the future anyway due to automation.
- Minimum wage employees whose value is higher will get the new wage. Net increase in standard of living, though they may also be let go in the future due to automation.
- Some businesses pass costs on and others don't, depending on vagaries of the different markets or non-markets
- There is overall inflation but it's highly uneven and not very noticeable

Wrong! If you think any business is just going to absorb these costs without a bump in revenue then you have no clue what business is about. These costs always get passed down. In the end we all pay more! So essentially zero sum as MonctonRad said!

[Xelebes]

Originally Posted by J81

Wrong! If you think any business is just going to absorb these costs without a bump in revenue then you have no clue what business is about. These costs always get passed down. In the end we all pay more! So essentially zero sum as MonctonRad said!

Cost to produce goods = DM + DL + MOH. A 30% increase in wages does not mean that the cost of production will increase by 30% unless you expect all of the cost to be in DL.

[SignalHillHiker]

I'm fine with any reasonable increase, and I'd consider $15/hr to be reasonable. Currently the minimum wage in Newfoundland and Labrador is $11.15 and it is indexed to the National Consumer Price Index (basically inflation - the national one is always much lower than our provincial one). The typical minimum wage earner in this province is an adult woman who is not a post-secondary student and is often the sole earner for a family below or near the poverty line - so more for them is fine with me.

[vid]

Originally Posted by J81

Wrong! If you think any business is just going to absorb these costs without a bump in revenue then you have no clue what business is about. These costs always get passed down. In the end we all pay more! So essentially zero sum as MonctonRad said!

What if I told you it was possible to increase revenue without increasing prices?

[Taeolas]

I hate it when these Minimum Wage discussions get hung up on a particular number (like these "Fight for 15" type goals), because ultimately it clouds the issue and leads to people making the stupid counter arguments like the aforementioned "But firefighters only make that much..." It also means people think the fight is done if a government gives in and sets a 15$ wage target, without having any mechanisms to have it keep growing as needed.

In my opinion, minimum wage should be set regionally and be pegged (so it automatically goes up as needed) at slightly higher than a cost of living metric for that region (something Stats Can should be tracking or should be able to figure out from what they are tracking), such that if you're working 40 hours/week (across 1, 2 or more jobs all at minimum), you'll be earning more than the cost of living for that region.

That means big, expensive cities like Toronto or Vancouver might be seeing 20-25$ minimum wages, while smaller communities like Regina or Moncton might see 15$ minimums. (Numbers are just wild guesses since I'm too lazy to try and look up any cost of living indices )

[1overcosc]

Originally Posted by J81

Wrong! If you think any business is just going to absorb these costs without a bump in revenue then you have no clue what business is about. These costs always get passed down. In the end we all pay more! So essentially zero sum as MonctonRad said!

Five months the ago the minimum wage here in Ontario suddenly increased 20%. The cost of restaurant food and fast food did noticeably go up, though not by 20% (maybe 10%? hard to judge). But the cost of groceries and durable goods (furniture, hardware store stuff, etc.) didn't change at all.

According to Consumer Price Index data, Ontario's year-to-year rate of inflation, from April 2017 to April 2018, a time period which includes the minimum wage hike, is a modest 2.1%, actually lower than the national average.

So yeah. We have real world evidence here in Ontario that minimum wage hikes do not generate inflation.

[lio45]

Originally Posted by Franco401

Before we start this argument, I'd like to point out to the idiots who'll inevitably come in here complaining about fast food workers getting the same money as firefighters, the remedy for that situation is to pay skilled workers even more, instead of bitching about poor people getting a living wage.

If everybody's going to get more, we might as well just introduce a New Dollar that's pegged at ($15/currenthourlyminimumwage*OldDollar) and start using that currency without changing anything else. Boom, $15 new minimum wage, everybody's happy.