Calling on workers and bosses: Your view on minimum wage

The minimum wage increases to $7.25 an hour Friday, another example of government’s role in the economy. Some believe it’s absolutely critical. Others see it as meddling.

Even with the 70 cents an hour increase, full-time employees would earn only $1,160 a month. That’s not easy to live on these days.

At the same time, small businesses are having a tough time in this economy, as sales decline and credit dries up. The wage increase adds to the pressure.

Where do you stand?

21 comments Add your comment

reservoirDAWG

July 22nd, 2009
10:59 am

A worker is worth what they bring to the table and how much money they can make you.

Avery

July 22nd, 2009
11:30 am

Most minimum wage workers are teenagers who are unskilled. All raising the minimum wage accomplishes is increasing teenage unemployment. Given that a lot of the criminal activity in Atlanta right now is caused by unemployed teenagers, that’s something we don’t particularly need more of right now.

ornery

July 22nd, 2009
11:59 am

Agree with Avery, They should devise a training wage for teens and dropouts of probably $5.00 an hour. Then let the market decide on the pay. All they are doing now is raising prices at grocery stores and fast food joints or make the manager do more work to slash the labor costs. To think this came from the W. administration..

CathyD

July 22nd, 2009
12:13 pm

Sorry folks, it is not just the teenagers having to work for minimum wage with all the job loses some adults are having to pick up these unskilled jobs and they are highly skilled workers. This is not by chose it is what it is. RECESSION WITHOUT PAY!!!

Yvonne

July 22nd, 2009
12:13 pm

We opened a restaurant in 2007 (the year the economy started its downward spiral) and have been the recipients of the long, painful recession. The process for opening the business began in 2005 and the store was being built in 2006. Had we known that this recession would linger for an extended period with its devasting effects, there is no way that we would have proceeded. While the new minimum wage may not seem much to some, it will negatively impact our store significantly. We cannot afford any additional expenses. We have been juggling the bills for so long just to stay open. With 8 employees, wages will increase several hundred dollars per month. If sales do not increase soon, we may not be able to stay open. Instead of keeping 9 people employed with the current minimum wage, the State of Georgia and its taxpayers will now be paying unemployment wages to these staff members. Where is the logic in that? There should have been a waiver for employers until the economy recovers. If we are forced to close, many people lose (business owner, landlord, lenders, employees and their families, IRS, Department of Revenue–sales taxes, Labor Department, etc.). Small businesses need help!

Brian

July 22nd, 2009
12:28 pm

The problem is not the minimum wage but the reason people over age 25 are paid minimum wage. If you are being paid minimum wage at age 25, you typically lack skills, education, drive or motivation. The improvement in those areas is the responsibility of the individual. I want to see poverty end, but I have seen TOO MANY instances where workers are not even worth the $6.00 per hour they are paid.

Chuck

July 22nd, 2009
12:31 pm

I know a lot of people will hate on me for saying this on a business blog but I feel that while jobs will be lost, the workers whose jobs are kept will be better able to survive. $5.15 an hour is inexcusable to pay someone for even the most menial tasks…even a teenager. Yes businesses will have to slightly raise prices but I for one am fine with that if the difference allows someone to pay their utilities or eat three times per day. If you cannot raise prices and if a few hundred dollars a month will close your business, then you likely did not have cause to open in the first place. This was long overdue if only to keep up with inflation.

reservoirDAWG

July 22nd, 2009
12:37 pm

You’re right Chuck. I am hating on you.

Yvonne

July 22nd, 2009
12:51 pm

Chuck, you clearly do not have a strong sense of what it takes to operate a restaurant (your comment about the few hundred dollars seems to be directed to my blog). You cannot even imagine. As a franchisee, we do not control costs such as food or royalties. The owners of this business invest thousands of dollars monthly just to pay the staff and operating expenses. We care about the people whom we employ; otherwise, why would we continue to persevere? We know that when our clients begin to feel more confident about the economy, they will begin to eat out a little bit more…resulting in higher sales. Why raise the prices and discourage people even more from spending? We cannot compete with the $1 menu items from certain restaurants. However, our food is favored by those who want quality in eating.

Yvonne

July 22nd, 2009
12:54 pm

Chuck, by the way, we have never paid anyone $5.15 per hour. Our beginning pay per hour, even for teenagers, has always exceed the GA state minimum wage.

The Sarge

July 22nd, 2009
1:01 pm

Contrary to Avery’s assertion on unskilled teens being the predominant recipients of min wage, a visit to any number of restaurants, fast food establishments, and retail stores will indicate otherwise. Lee Iacocca once coined the term “living wage”…one has to ask one’s self one question…is the min wage a living wage, or simply “pin money” for the kid living at home with all living expenses covered? Granted we are in probably the worse economic fiaso since JC was a Corporal…knee jerk reactions are the order of the day, but viewed from the broader perspective of economic planning, a min wage never made much sense. Historicaly, the economy was fueled by (theoreticaly) 2/3 consumer spending. However, that spending has been comprised predominanly of “funny money” born of nothing more than hopes and dreams manifested in the absurd home values of recent years. Thus, we have become a Nation of “$35,000/year millionaires”, relying, in large part, on “non-wages” to support the economy. Only when min wages are tied to the market forces of supply and demand will we see a true economic recovery. If people, skilled or not, are willing to sell their sweat for, say, $5/hr, so be it. If business, large or small, can’t survive while “taking care of the troops”, they don’t need to be in business. One of the most-famous corporate lies…”employees are our most-valued asset”…show it.

Carolyn

July 22nd, 2009
2:29 pm

What many people don’t realize is that there is either a ripple effect or an internal inequity when the minimum wage goes up. If a grade 1 employee gets a 70 cent increase, about the employee currently making $7.00 after merit increases for 3 years? Does he just get 25 cents, wiping out all his merit increases? What about the employee is a higher level job in a grade 2 that has a minimum of $6.88 (which is 5% above the grade 1 minimum of $6.55)? Unless you pass the 70 cent increase along to all your employees, you have wage compression and an internal inequity. If you do pass it along, the cost skyrockets. Employees hate internal inequities.

Yvonne

July 22nd, 2009
4:06 pm

Well said, Carolyn. That is what our company is facing. When the minimum wage increases, recently hired employees benefit. To be fair, longer term employees who have had their pay frozen due to economics should also receive at least the same percentage increase.

Carolyn

July 22nd, 2009
4:35 pm

Yvonne, actually if you pass along only the cents per hour the minimum moved instead of a percent increase, it will still be considered fair and will save your company money.

Brad Steel

July 23rd, 2009
9:01 am

Yeah, increasing the minimum wage will kill business and undermined America, just like it has NOT for the past 40 years. Just like mandatory seat belts and airbags did not kill the car business and the tobacco ad-ban has not killed Phillip Morris, the minimum wage arguments are BS that support a wage level that is, shamefully, not even livable.

THE PEOPLE SHOULD BE TAKING TO THE STREET TO DEMAND A
MAXIMUM WAGE !!!

Up Chuck and Barf

July 23rd, 2009
9:08 am

yvonne
it sounds like you business stink. you need help? you want the government to bail you out and yet you have the temerity to complain about a non-livable minimum wage. phu-leez.

restaurants fail at a rate of 80%+. don’t blame minimum wage workers on your poor judgement and business accumen.

Wordwizard

July 23rd, 2009
10:14 am

The problem with the minimum wage is “it’s all carrot and no stick”! There should be a tiered minimum wage. ‘Apprentice’ minimum wage applies if you haven’t earned your high school diploma or GED. This will significantly reduce the high school dropout rates and at the same time improve ‘ready-to-work’ skills of the employee base. Essentially, if you work at improving yourself you eventually get paid for it with higher minimum wage! This is a win-win solution for the employee, the employer and America! I’m so tired of the federal government making laws that GIVE away money without requiring something in return.

Carolyn

July 23rd, 2009
4:19 pm

Whether or not the change in the minimum wage is a good thing or a bad thing is a moot point now that the legislation has been passed. But it will have ramifications. Labor costs are one of the biggest parts of most employers’ budgets. If you need to cut expenses, you can either cut unit cost (the hourly rate) or quantity (number of hours worked). Time will tell what the ramifications are. Without governmental intervention, employers will pay what they have to in order to attract, retain and motivate qualified employees and they will do so in the most cost-effective manner possible. That’s how they stay in business. And, of course, they have to abide by the law.

Jodie

July 24th, 2009
9:58 am

“The real minimum wage is zero.”
Thomas Sowell

Teenage unemployment rate already at 30%…. Brilliant

CookMyOwnFries

July 24th, 2009
10:29 am

How much longer before there will be self-serve kiosks and checkouts at fast food joints? Anybody see a “full service” gas pump lately? Self-service machines just require maintenance wages, not living wages. Wait and see how much self-service you end up doing in places where you’re getting full-service.

Rickster

July 24th, 2009
11:35 am

Anyone want to guess how much of an increase we’ll seen in new unemployment claims over the next 2-3 weeks after the minimum wage hike?