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| courtesy of Pixabay CC0 Public Domain |
The message from the people who own the businesses who employ
minimum wage workers is clear and simple – YOU CAN BE REPLACED!
Most of the jobs currently being done by minimum wage workers
can be done better, more efficiently, with fewer errors, and with greater
customer satisfaction by a kiosk or robot. Several fast-food companies, such as
Sheetz and Panera Bread are already proving this to be true. The latest food
vendor to field robotic service to customers is Pizza Hut of Asia. If you want
the details, you can read the article “Pizza
Hut Just Signaled…” here.
The scary thing for the minimum wage workers clamoring for the
$15 an hour is that the robot can greet customers, take customized orders, and
take payment, all without expecting a tip, making the experience fun,
interesting, and less expensive for restaurant customers. Another plus, robots
don’t have bad days or get surly with customers.
My wife had an experience at a fast-food restaurant yesterday at
which the person serving her had a bad attitude, was discourteous, and got her
order wrong. Had she had a robotic server, none of this would have occurred and
my wife’s experience would have been much nicer. Her opinion of the business would
definitely not have been negatively affected the way it was.
The server in question was a high school girl who was most
likely in a bad mood because she had to work Memorial Day Weekend. I’m just
guessing here. There are myriad reasons a high school girl might have been in a
bad mood, but the one I offer seems reasonable.
My students have often asked me what I think about raising the
minimum wage to $15 an hour. I tell them the harsh economic reality is that if
the jobs were worth $15 an hour, the workers would already be making that much.
The problem the workers have is they know their labor isn’t worth $15 an hour
so they want the government to force employers to pay them more than the work
is worth.
I also educate my students to the fact that while those
supporting the increase try to say that there aren’t that many workers at
minimum wage so it won’t really be that much of a financial burden on business,
what they don’t say is that every worker in the country making between minimum
wage and $14.99 an hour, and every 40-hour-a-week salaried worker making less
than $31,200 a year would have to receive a raise. Since thousands of
firefighters, police officers, and teachers around the country, especially in
smaller municipalities, make less than this per year, I encourage my students
to imagine how those towns and districts are going to have to choose between
huge tax increases or laying off essential workers.
Then I challenge my students as to whether they want to live a
minimum wage life or if they want more. Not a single student indicates they
want to spend their life working for minimum wage. That’s when I hit them with
the importance of education. I tell them the taxpayers of our district, state,
and nation are providing them with a free education worth thousands of dollars
a year and it is up to them to use this free education to prepare themselves
for a career that will let them reach their potential so they don’t wind up
being replaced by a robot with a spicy name who can do their low or no skill
job faster, better, and cheaper than they can.
As always, I remain,
The Exhausted Educator
How much are "minimum wage" jobs worth then? The push for a fifteen dollar minimum wage is because the cost of living far outweighs the current minimum wage. Many minimum wage employers help their employees apply for social assistance. Tax payers are subsidizing the wages of the employees while many minimum wage paying employers are profiting in the billions (McDonald's, Wal-Mart). did you tell you students that? Did you tell your students that income inequality is the greatest it has been in the history of the United States? I bet you didn't. You should have never been allowed near a classroom.
ReplyDeleteMcDonalds employs about 1.9 million people. If it gave every one of its employees a $1 an hour raise it would cost the company $1.9 million dollars an hour, approximately $15 million dollars a day, $106.4 million dollars a week, or about $450 million dollars a month. That $1 an hour raise would cost McDonald's $5.5 billion dollars a year. That amount is about equal to McDonald's annual profit before taking into account the 21% drop in net income experienced by the company in its most recent quarter.
DeleteRaising all McDonald's employees to a minimum wage of $15 an hour would quickly bankrupt the company as that is significantly more than an average increase of $1 an hour per employee. The company would have to make up those losses by dramatic price increases or by cutting it's labor force significantly in order to stay in business.
Another thing to think is how many of those minimum wage fast food workers can be replaced by kiosks and robots. The answer is nearly all of them. In the push for $15 an hour, the workers seeking the higher wage may just push their employers into eliminating their jobs altogether.
And yes, I explained all of that to my students. I have also addressed the current situation of income inequality with my students and we discussed in depth how it has come about and how a more realistic tax system could help improve it. We also discussed how the only tax the founding fathers agreed on was the estate tax because it would keep great wealth from being concentrated in the hands of a few families and how subsequent Congresses have failed miserably at closing the loopholes that allow the moneyed families to get around the estate tax, including the elimination of the tax under the GHWB administration.
Type "how many people does McDonald's employ?" into google and 1.9 million is what you get. It's obvious this is what you did after reading my comment. Trouble is, that's worldwide, not in the United States. I'm not going to argue with you about our difference in opinions. Nor will I be swayed by some quick math. The truth is too many people don't earn enough to live on. Governments are using tax revenue to subsidize the incomes of people who work full time. The very point of minimum wage is that it's supposed to be the minimum amount of money that someone can live on. income inequality is the single greatest issue plaguing America. If people don't earn enough to live on then they certainly don't have money to spend. If people don't have money to spend the economy cannot grow. The more people earn the more they pay in tax. The more people earn the more they spend. The more they spend the more the economy grows. The wealth has always been there it's just concentrated by fewer and fewer people. A $15 minimum wage and the economic shock it would cause is a necessary adjustment. A step in the right direction. McDonald's won't go bankrupt, but if it does that void in the marketplace will be quickly filed. Gone is the middle class. In its place we have 1% of the population controlling the means of capitol and all the wealth and the other 99% having to work harder and harder for less. The worst part is you're part of the 99% yet you advocate for the 1%.
ReplyDeleteYou caught me. I did use the world wide employment figure. But then you are using the world wide profit figure so I thought it would be fair.
DeletePerhaps you'll set aside your dislike of research and facts long enough to allow me to restate the math. Let's use the Bureau of Labor Statistics numbers. According to the BLS, in 2013, the latest year for which I could find data, approximately 3.3 million Americans worked for a wage at or below minimum wage. Of that number, about 1.2 million were full-time workers. To raise just the full-time minimum wage workers to $15 an hour would cost American businesses $21 billion dollars once you include payroll taxes. Since we know the businesses are going to pass that along, it means the goods and services provided by those workers will increase in cost to the consumer by $21 billion dollars. More when you take into account the part-time workers who will also get the raise. According to the BLS they number about 2.1 million. And still we haven't taken into account all the hourly workers who make between minimum wage and $15 an hour, all of whom would also get raises, as well as all the full-time salaried people making less than $31,200 a year. They would all have to be given raises. By the time all this works its way through the economy, $15 an hour will no longer be sufficient to live off of, any more than $7.25 an hour is today, due to the cost of every good and service provided by these workers going up so businesses can afford to pay the higher wages and still make some profit. Don't forget, businesses don't exist to provide jobs, they exist to provide investors with a return on their investment.
If you had read my entire reply to your comment, you would realize that I am not advocating for the 1% and I am in favor of taxation, including a higher estate tax, that would help reduce the gap between rich and poor.
We both agree that something has to be done about income inequality. I would like to see a law passed that limits the highest paid employee of a company to a salary that is a reasonable multiple of the lowest paid worker's annual income, including the executive's bonuses, another thing I'd like to see ended.
But I don't think the way to do that is to put thousands of low-wage workers out of work, which is what will happen if the federal minimum wage is suddenly increased to $15 an hour. It sounds good, emotionally it feels good, and from a certain political perspective it gets candidates votes, but economics wins over emotion every time. I'm afraid simply paying people at the low end of the spectrum more won't fix the problem. The problem has to be attacked at the top and the bottom, and one way to do that is to kick out the politicians we have and elect new representatives with fresh ideas who aren't beholden to big business.
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ReplyDelete