Arizona Minimum Wage hike

[TexasHusker]

It never ceases to amaze me that people think you can jack up minimum wage in a vacuum and nothing else should change.

As a business owner, here is how thr minimum age affects me:

1. My employees start out at $2 higher than MW (about 30% higher).
2. Labor is 60% of my business's expense.
3. My profit is about 15% of sales.

Let's say Texas raises MW $2. You might say "no problem you're already there!"

Yes, but now I'm only paying my people MW, and their buying power has been greatly reduced, as hamburgers, healthcare, and clothing have all gone UP 30%.

So to keep their own buying power whole, I have to raise them 30%, or $3 per hour roughly.

Now if I don't RAISE PRICES, my labor costs have jumped 30%, and are now 78% of my expense. I now make NO profit, and in fact I'm now IN THE RED.

Aww shucks I'm just a rich business owner I don't need a bottom line. Oh wait I think I poured my life savings into this business and it provides for my family - maybe it SHOULD make some sort of profit. Is 15% too much?

So if I'm going to keep my 15% profit, I'm going to have to raise prices by AT LEAST 30% to 1) pay for the raise all my employees just got, and 2) keep MY OWN purchasing power the same, since EVERYTHING ELSE went up.

Minimum wage is and will always be the minimum. It's a political tool for the sheeple. Set it at $100 an hour for all I care. That just means that tomorrow, a Big Mac meal will run you around 95 bucks.

Come on people, think all the way through these things a little.

[Singuy]

It never ceases to amaze me that people think you can jack up minimum wage in a vacuum and nothing else should change.

As a business owner, here is how thr minimum age affects me:

1. My employees start out at $2 higher than MW (about 30% higher).
2. Labor is 60% of my business's expense.
3. My profit is about 15% of sales.

Let's say Texas raises MW $2. You might say "no problem you're already there!"

Yes, but now I'm only paying my people MW, and their buying power has been greatly reduced, as hamburgers, healthcare, and clothing have all gone UP 30%.

So to keep their own buying power whole, I have to raise them 30%, or $3 per hour roughly.

Now if I don't RAISE PRICES, my labor costs have jumped 30%, and are now 78% of my expense. I now make NO profit, and in fact I'm now IN THE RED.

Aww shucks I'm just a rich business owner I don't need a bottom line. Oh wait I think I poured my life savings into this business and it provides for my family - maybe it SHOULD make some sort of profit. Is 15% too much?

So if I'm going to keep my 15% profit, I'm going to have to raise prices by AT LEAST 30% to 1) pay for the raise all my employees just got, and 2) keep MY OWN purchasing power the same, since EVERYTHING ELSE went up.

Minimum wage is and will always be the minimum. It's a political tool for the sheeple. Set it at $100 an hour for all I care. That just means that tomorrow, a Big Mac meal will run you around 95 bucks.

Come on people, think all the way through these things a little.

Actually nvm, you answered it.

[Singuy]

I honestly don't care for a min wage increase since I kind of want supply and demand dictates the job market. If you are making the min wage and it's not a "living" wage for you..then either you

1. Make it into a living wage..ask an immigrant or an illegal making half of what you make and see how they manage to survive.

2. Try to make something out of yourself. I feel too many people are content. If their food stamps and low income housing will get them by working at MCD..why even attempt to better their earnings.

[james.hendrickson]

I honestly don't care for a min wage increase since I kind of want supply and demand dictates the job market. If you are making the min wage and it's not a "living" wage for you..then either you

1. Make it into a living wage..ask an immigrant or an illegal making half of what you make and see how they manage to survive.

2. Try to make something out of yourself. I feel too many people are content. If their food stamps and low income housing will get them by working at MCD..why even attempt to better their earnings.

Singuy - what our discussion so far hasn't taken into account is the fact that wages have been steadily eroded by inflation. In any given year 2% inflation isn't such a problem, but this adds up year over and year. For example, something that cost a buck in 1980 now costs $2.91. When you factor in the increasing costs of health and housing there is a real need for improved financial education and improved quality of jobs.

[TexasHusker]

Singuy - what our discussion so far hasn't taken into account is the fact that wages have been steadily eroded by inflation. In any given year 2% inflation isn't such a problem, but this adds up year over and year. For example, something that cost a buck in 1980 now costs $2.91. When you factor in the increasing costs of health and housing there is a real need for improved financial education and improved quality of jobs.

Regardless, raising minimum wage to whatever number you choose will result in the cost of goods and services rising commensurately. They must. Businesses have to eat the cost of higher labor, which means consumers ultimately pay that cost one way or another.

Minimum wage will never be a living wage, because it will always remain the "minimum" wage.

There is no free lunch. Minimum wage workers' standard of living cannot and will not be improved by the stroke of a pen.

[Singuy]

Singuy - what our discussion so far hasn't taken into account is the fact that wages have been steadily eroded by inflation. In any given year 2% inflation isn't such a problem, but this adds up year over and year. For example, something that cost a buck in 1980 now costs $2.91. When you factor in the increasing costs of health and housing there is a real need for improved financial education and improved quality of jobs.

Inflation is not a set number. The 2% is a ball park figure which extrapolates from supply/demand and new currency introduced to the economy. Healthy competition/free trade/globalization really kept inflation in check for the most part.

You can argue purchasing power has reduced for the average American, but the system typically balances itself out with the free market at work using the supply and demand model. If inflation exist when you cannot afford to buy anything..then you really need to look at the root cause of that situation. There should be no reason for eggs to cost 2 dollars/carton when people can only afford to pay a dollar..or are willing to pay only a dollar. The 2 dollar hyper inflated eggs should go out of business if no one buys it.

So perhaps the working class is shrinking in the area causing goods to increase? Or maybe it's the opposite which causes the cost of living to be much lower?

http://www.pewsocialtrends.org/2016/05/11/americas-shrinking-middle-class-a-close-look-at-changes-within-metropolitan-areas/

This shows that two different cities can go both ways which ultimately determines the cost of living.

So if you can't afford to live on your current wage in the area you are in, my conclusion is that you are falling behind somehow vs your neighbors.