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Compassion for low wage workers . . . 

10/30/2016

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Life is hard for low-skilled workers

More below.
. . . especially the small number working to support a family.

I have nothing but respect for these people, this life can be crushingly hard, with little extra money, and endless work just to stay in place. This is the modern Red Queen's race. Running as fast as one can to stay in one place. But even this changes, and most of these people slowly build the work skills necessary to slowly increase their wage, and make a better place for themselves, and their families in the world.

"Thanks to Boston Globe columnist Jeff Jacoby for a nice plug for CD in his latest column “For low-skilled workers, life is hard. Minimum-wage hikes make it harder,” which linked to the recent CD post “2 Washington ballot initiatives: A carbon tax to reduce emissions, another for a $13.50 minimum wage to reduce jobs?” that featured the Venn diagram above. Here’s an excerpt from Jeff’s article:

There’s little mystery about what happens when the price of something goes up: All other things being equal, the demand for that something — a quart of strawberries, a ticket to Pittsburgh, a new waitress — goes down. The Law of Demand is about as fundamental an economic axiom as there is, and it can’t be revoked by politics or worthy intentions. Force up the cost of employing low-skilled workers, and fewer low-skilled workers will be hired.
….
It’s easy to see — and, if you’re in politics, to take credit for — the extra money some workers earn when a minimum-wage hike is legislated. What’s not seen are the paychecks that are never issued because businesses didn’t expand. Or because companies decided to invest in new equipment instead of new employees. Or because workers’ hours were cut back.
Consider Seattle. In 2014, city officials adopted a $15 an hour minimum wage and subsequently hired University of Washington researchers to assess the law’s impact. The report, issued in July, found that while low-wage workers who kept their jobs were indeed paid more per hour, “the unintended, negative side effects on hours and employment muted the impact on labor earnings.” Sadly but predictably, “the Seattle Minimum Wage Ordinance appears to have lowered employment rates of low-wage workers. . . . The effects of disemployment appear to be roughly offsetting the gain in hourly wage rates, leaving the earnings for the average low-wage worker unchanged.”
….
Minimum-wage laws invariably make more jobs unaffordable and more workers unemployable. Bromides about giving a raise to workers on the lowest rung of the economic ladder may give legislators and advocates the warm-and-fuzzies. But workers still struggling to reach the bottom rung aren’t fooled. Their life is hard. Minimum-wage hikes make it even harder."

It is childish, and venal that politicians would spend their days devising ever more policies to trip them up in the guise of help. Yet that is what the politicians of the progressive ilk do. 

This effect does not just happen when the state imposes a new higher wage, it happens even when the private sector takes similar actions. 

​Starbucks baristas complain of reduced hours, why!

Higher wages because an individual merits the wage, because he makes the company more income, is different than generally higher wage because the company feels political pressure to raise wages for moral reasons. In the latter, the company will need to find some way to make up the new wage costs. In the Starbucks story, the rising wage on all is retracted by the falling number of hours by many. The company finds this attractive since it allows the company to appear to be broadly beneficent, while in reality it is raising the wage of all, but only lowering the hours of the less productive. In the end, it is the less productive who pay for this benefit with lower total take home pay. 

Less subterfuge would have been better here since it would have allowed the employees to understand what the employer was rewarding, but such is the political lay of the progressive land. Progressivism always requires calculated machinations to achieve the correct result. Travesty.

Best wishes to all those working the hard knock minimum wage job trying to raise a family. Please stick with it, continue to better yourself, and improve. Don't let the machinations of the progressives get you down. 
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