Wage Wars

As seen in the January 24, 2006 Record Herald

NOTE:
The article to which I am refering to in this column can be found
Here



In the Friday, January 20, paper, syndicated columnist Holly Sklar wrote, "We need wage ethics today." She wrote of the "need" to raise the minimum wage in America.

Brace yourself for my opinion, most of you won't agree with it; but please stay with me and let me explain. My opinion is that we should not have a minimum wage. If you want to work for $1.00 an hour, that's up to you.

Let's say that, today, there is no minimum wage. Can you live on $1.00 an hour? That's grossing $40.00 a week, after taxes, about $29.00 a week. I spend more than that on gas. I know I won't work for $1.00 an hour, so I won't take the job. If you won't take it either (and perhaps no one will) guess what? Whoever is hiring at $1.00 an hour is going to have to up their rate. The employer will have to raise their rate and perhaps their prices to compensate, but eventually they will be paying an acceptable wage and selling at acceptable prices. That's how the economy works. Costs go up, prices go up.I used to work for minimum wage. I did that for about 1 month, then I received a (small) raise.

I continued to work there about 4 months total. That wasn't cutting it so I got a new job. It was second shift and a farther drive, but the pay was worth it so I made the switch. Will I ever work for minimum wage again? No. I can't pay the bills on it, so I won't do it. I'm betting you wouldn't take a job that didn't pay you enough to pay your bills either.

Sklar does not mention that most people don't work for minimum wage for long, either.

Now let me tackle her math.

She states; "A low minimum wage is a green light for greed. Between 1968 and 2004, domestic corporate profits rose 85% while the minimum wage fell 41% and the average hourly wage fell 4%, adjusted for inflation. In the retail sector, which employs large numbers of workers at or near minimum wage, profits skyrocketed 159%."

The only way for profits to be up is for people to be spending money. Minimum wage may have stayed low or dropped compared to inflation; however, wages must have gone up somewhere or no one would have had the money to spend which increased profits. Low minimum wage is not a "green light for greed," it is a speed limit. If you want to work for $1.00 an hour, that's great for the company that hired you! They are going to do well because you are willing to work for $1.00 an hour.

Sklar does not mention that most of those working for minimum wage are teens who don't need the money, but want it. If the minimum wage is forced up, the cost of business goes up, which raises cost for consumers. You then make more, but you spend more, so not a lot has happened by raising the minimum wage.