It's Andy Fish!

I completely understand the reasoning behind creating a “living wage” by raising the minimum wage to $20-$25/hour– on first glance it’s a sound idea, but that’s the problem with anyone who stops the thought process right there, and this includes many people I consider extremely intelligent.

Let’s go through this step by step and I bring some expertise here, having run a series of Supermarkets where many of my employees were minimum wage, I myself started at $1.30/hour and rose up through the ranks to where I was making $44/hour plus bonuses– it’s important to take note of that, especially when we get to item #2.

Item #1 – Minimum wage is supposed to be the lowest link on the food chain, it primarily was designed to allow high schoolers to pick up some part time work after school. All of my grocery baggers when they were hired (and the job I started with) earned minimum wage.

Minimum wage is for NON SKILLED WORKERS. Essentially if you are healthy and don’t have a ridiculous criminal record you should be able to be hired into this position. It is supposed to give you a foot in the door, and it’s also worth noting that if two people got hired, one as a bagger and one as a cashier the cashier got a higher rate because they had a SKILL the bagger didn’t have. The bagger, however, has the opportunity to obtain an in-house learned skill that would net them a higher hourly rate. They can also grow that rate with consistent and quality work at there annual review.

Item #2 – It therefore goes without saying, or at least I don’t think it needs to be said because it’s simple logic, that if you are someone who is working at a minimum wage job and you are an adult who had been employed for longer than a year then there is something WRONG with your work ability. Or it means you’ve spent the last several years of your life bouncing from job to job, never being able to get a foot hold on any advancement. The counter argument is that some people are capable of getting beyond the lowest entry level– I would say as someone who managed well over 3000 people that is never the case. If you take an entry level job and you do what is expected of you, and you show up, occasionally filling in for an extra shift when needed, you will advance, it’s honestly that simple.

Item #3 – All raising the minimum wage to such a large amount accomplishes is two fold;

A- It makes the cost of everything go up, because the company will pass the added labor rate on to the consumer. Making this new “living wage” now no longer valid because a Quarter Pounder just jumped from $4 to $10.

B- It causes people to lose jobs– remember those cashiers I mentioned? Yeah, take a look at how many are manning registers now and how many have been replaced by self service checkouts. Even McDonald’s has placed Kiosk’s in their restaurants so they no longer need a front end cashier–they are replaced by six kiosks and guess what? We’ve also learned that it’s faster to order at a Kiosk and it’s faster to check yourself out. All we did was eliminate jobs and replaced them with more efficient lower cost solutions, putting those minimum wage workers out of work, and cutting the number of jobs available in the first place.

Its also lead to many businesses, especially small businesses, out of business because they cannot possibly afford those higher payrolls.

So on first glance its a nice idea, but giving it some thought its actually just releasing destruction on these industries that rely on low wage workers, and hurting those low wage workers in the end.