Your daughter has it right

tsjohnson5 — Mon, 28 Jul 2008 11:37:40 -0500

Well your daughter said what I was going to say. That basically sums it up. People can't live on it, so quibbling over it is just pointless.

The Yin and Yang of the Increase In The Minimum Wage

Elana Centor — Sun, 27 Jul 2008 19:01:40 -0500

When I started my professional career in 1973, I had no idea what the minimum wage was. I just knew that the wages I was getting -- my infamous $3.25-- was impossible to live on. Turns out the minimum wage in 1973 was $1.60.

Money Musings just ran a comparison of costs of things in 1973 to 2007 based on the minimum wage.

I thought it might be interesting to look at prices of some common items back in 1973, and then compare those prices to similar items (well, as similar as one could get) in 2007. But I wanted to go one step further: I wanted to see how prices in both periods related to the minimum wage that prevailed at the time. How would prices in both periods look, say, when taken as multiples of their respective minimum wages?

The Federal Minimum Wage is now $6.55. That's a jump from $5.85 an hour.
Depending which state you live in, the Federal Minimum Wage will not really have an impact because 25 states already have laws requiring a minimum pay that is higher than the federal Minimum Wage.

A complete listing of the states and their minimum wage is available at The Specialty Board Sports Industry blog aka BRA BUZZ. If you are a minimum wage worker the best state to work is Washington where the minimum wage is $8.07 and indexed for inflation.
According to The Consumerist,

only 1.7 million Americans rely on the federal government to set a wage floor. Of that group, only 20% are teenagers working part time and summer jobs.

The number impacted by the minimum wage surprised me. I assumed it was much larger. However, what really started me was this:

The nation's top financial minds can't tell us how the minimum wage effects the economy, but we're sure our beloved cadre of ever-cheerful commenters not only knows for certain, but is willing to share.

And they were right. Emotions run high on both sides of the minimum wage issue.

KrispyKrink was one of the commenters.

It's kind of a double edged sword. I like seeing a good minimum wage for those that are disabled that want to actually be part of the work force. They have bills just like everyone else, and $6 in this day just ain't gonna cut it.[...]The bad part, last time CA raised the limit the businesses I know either cut hours for staff or flat out fired people so they can pay those they kept. In the restaurant business this equates to higher price for the customer and less employees to cover the floor. Some businesses end up firing higher paid middle and upper management to keep the hourly workers, so the next time you have a fraked up time at Sears this is why.

EconomistMom writes My Daughter Got A Raise Yesterday

as Virginia “observes” the federal minimum wage, which went up yesterday from $5.85/hour to $6.55/hour. With the 15-20 hours/week she works, that’s at most $14 extra/week, which is still nothing in terms of the “true value” our family places on her B-R employment from getting that family discount on the ice cream…and even the occasional flubbed-up ice cream cake we get for free! Which goes to show you that sometimes the biggest work incentive effects–perverse or otherwise–are unrelated to the wage rate.

While the increase may not be significant to a teenager, Stephanie Anagnoson who blogs as Ms. Theologian at Surviving The Workday

I suppose it’s actually more lame to simply never increase the minimum wage, but an increase to $6.55/hr? Energy costs are up 25%, food costs are up 5% and the minimum wage is up $.70 an hour (12% of its pitiful $5.85/hr). That could be an entire $3.50 a day before taxes.

The new minimum is less than the inflation-adjusted 1997 level of $7.02, and far below the inflation-adjusted level of $10.06 from 40 years ago, according to a Labor Department inflation calculator.

Seriously. Lame.

Meanwhile,The NFIB, (The National Federation of Independent Businesses) is painting a gloomy picture of the wage increase.

"Due to the weak economy, the Fed is trying to fight inflation and job loss at the same time. Raising the minimum wage makes both tasks more difficult. Business owners will now have to find a way to deal with rising food prices, energy costs and labor costs simultaneously. Firms will try to pass on some of these costs in the form of higher prices for consumers, which won't help inflation concerns. And, other firms will reduce opportunities for unskilled workers to get a job. Neither scenario is good for small business owners or the general economy."

Just asked my 19- year- old daughter what she thought of the minimum wage issue. She is a wise young woman.
She said, " A couple of years ago when the minimum wage as around $5.00, the government said the liveable wage was $12 an hour.When corporations and the government support a system where people get paid less than the livable wage it it says we don't care. " She added, "The minimum wage needs to be the same as the livable wage."

Now there's a concept.

Elana blogs about business culture at FunnyBusiness

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Your daughter has it right

The Yin and Yang of the Increase In The Minimum Wage