Friday, September 13, 2013

What Will Become Automated Now? The California Legislature Approves Raising Minimum Wage to $10

In the final hours of its 2013 regular session, the California legislature voted to hike the minimum wage from $8 an hour to $9 next July and $10 by January 2016 .

Gov. Jerry Brown has already promised to sign the bill.

Here's Orphe Divounguy to explain why minimum wages don't work:



And, for those of you that  think minimum wages haven't eliminated jobs, the next time you pump gas for yourself ask yourself what happened to the gas station attendants that used to pump gas and wash your windshields. At some price they could be hired from the pool of out of work youth.. The minimum wage has just priced them out of the market. The same thing when you can't find a department store clerk. The department stores and other retailers can't afford to hire more clerks because the minimum wage is too high to make it affordable.

It's the same thing with those damn automated phone answering services that most firms now use, it's just too expensive to hire human operators. And its the same with grocery store baggers from days of old. Thank you minimum wage.

The damage of minimum wage isn't some theoretical, you have just gotten so use to it that you have forgotten what things were like , or you are too young to know the good old days. I wonder what will become automated next and more inconvenient in California as the minimum wage climbs.

11 comments:

  1. Some would argue that the gas stations and department stores actually could afford to hire more clerks and pay them much more than the minimum wage but theyre just too greedy to do it because it would take money from CEO bonuses and corporate profits so we need minimum wage laws (higher ones) to keep them from exploiting us and keeping all the profits for themselves.

    low minimum wages and high profits is why the gap between the wealthy and the rest of us is widening

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    Replies
    1. How would you know if the minimum wage was too high, or too low, or just right?

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    2. It the premise "could afford" were corrects and if demands tor the services were real,, then a free market would supply what is wanted.

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    3. Anon 7:10, I would recommend you start a business and hire an employee. Then attempt to do your own payroll for that one employee. It's an incredibly complicated process, preventing many who try from succeeding. If a business has a high profit margin in the free market, other players will eventually correct the imbalance.

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    4. And when they used to have such positions available in the past, they weren't greedy?

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  2. Why is it just to 10? Why not 12, or 200, or 9.635? Do they have any rational justification for that conveniently round number or is it just totally arbitrary?

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    Replies
    1. I doubt it will go above $10 because they don't have any more fingers.

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    2. No, Tom. 10 is the exact right number. Not 10.01 or 9.99. We are the enlightened ones and we know what the right f**king number.

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  3. I loved the title to this write up.

    Just the other day I was admiring the automatic cup filling machine while waiting at the drive thru in McDonalds:

    It has a nice carousel that goes into motion after the attendant pushes the "go" button and it takes the order information on the drink(if it's a soft drink) automatically/electronically...drops the appropriate size cup, rotates it to the next station where the appropriate amount of ice is put in, then on to the proper nozzle bearing ordered drink and finally rotated for presentment to the attendant to hand to the driver.

    I'm thinking the whole get up probably costs McDonalds at least $25K from start to finish(machine cost, electronic integration, & finally deliver/assembly) even if they are getting a bulk discount.

    I'm sure that's a job that some teenager, retired person, etc. would love to have....but with payroll taxes, liability, etc. I can't blame McDonalds one bit for automating as much as possible.

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  4. Here's how it also plays out. I've worked in restaurant and bars for years on and off. Since you can't automate everything that leaves payroll. Instead of working 8, 8, 10 hrs owners adjust scheduling so that shifts are shorter. For example instead of 4 people arriving at 4pm to open the restaurant, they stagger in two at 6pm and the 2 4pm people are just made to pick up the slack. That saves 4 hrs / day in wages. That adds up over time. Now in the front of house (i.e. "tipped employees") no one objects-they get a higher cut of the tips or they get off early and their hourly wage is pointless ($5 usually) so they don't give it much thought. But typically this coincides with wage employees being forced to do the same. The porter who might be used to making $10/hr and getting 10 hrs of overtime/week finds HIS shift shortened and his work load the same while he gets a $150/week pay cut. Or instead of two guys cleaning up at 6-8 hrs each the will lay it on one guy for 10 hrs only schedule him 4 days and since overtime is calculated WEEKLY they pay no overtime as the other 3 days are covered by another employee (there is your part time set up) and in the end they save 2-4 wage hours PER DAY. That adds up.
    And just as a side note and purely anecdotal we typically paid $10/hour for these low end jobs back in 2000. Today it is not uncommon to have these guys making 8-9/hr.

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