California $15 an hour minimum wage passed

[gcal]

ok we all realize that employers that have to pay this will have to raise the price of their services or goods to cover this cost,  right?  Kalifornia is already outrageously expensive,  gas is more,  food is more,  rent is more,  everything is more expensive.  how does this help anyone,  the ones who it hurts the most are those that can least afford it.  if you are rich it doesn't hurt at all.  highdesertranger

If it is so expensive,  how can anyone making less than $15 afford to live and raise a family there?

 

[Optimistic Paranoid]

I'll try to avoid politics in this post.

"Natural Laws have no pity."

The laws of economics are natural laws, just as much as the laws of physics are.  Yes, it's a damn shame that good, innocent people accidently fall off of high structures to their death, but nobody suggests that we repeal the law of gravity.

If you hired a chemical engineer, you'd expect her to understand the science of chemistry.  You'd expect an electrical engineer to understand the science of electricity.

Yet we all seem to be perfectly content to let a bunch of lawyers and other politicians practice economic engineering even though most of them don't have a clue about economics.

Well, why not?  Most voters don't have a clue about economics.  If I were given the magical power to make one change in this country, every kid would study basic economics in high school.

The more these idiot politicians try to screw with the natural laws of economics, the more likely we are to, eventually, wind up trundling wheelbarrows full of paper money around to try to buy bread, as happened in Weimar Germany in the late 20s and early 30s.

Regards
John

 

[sephson]

First, for those of you who don't already know, I live and work in California.

I ran some numbers after my last post comparing what I earn now against what I earned when I started my current job back in 2000. Bearing in mind of course, that my pay raises over the years have been merit based and I consistently get exemplary performance reviews. Without accounting for inflation my hourly wage has gone up 33.3% in the last 16 years or roughly 3.2% per year. Minimum wage employees have seen hourly wage pay go up by 42.5% or about 3.6% per year in the same time period. Without disclosing any figures on what I actually earn, even with a 33.3% increase in my wages, my income relative to the California minimum wage has gone down by roughly 4.4%. I'll grant that it's not a huge figure, but if my pay continues to go up at 3.2% per year over the six year period of the minimum wage hike, I'll be earning 20.8% more than I make now while Minimum wage employees will see a 7% per year increase or 50% at the end of the six years. When all is said and done, my hourly wage will effectively have gone down a further 19.4% relative to the California Minimum wage.

I'm making a few assumptions here regarding my potential pay raises over the next several years, but if Minimum wage continues to go up at this rate, I'll be a minimum wage employee well before I'm ready to retire.

 

[LeeRevell]

I'll avoid getting "political", though this topic dearly begs it.  Suffice to say, this law will have a severe negative impact on employment across the board in every state that enacts it (as they all ultimately will).  All employers, especially the small businesses, will be hit hard with skyrocketing employee costs.  Their answer, for those not going out of business entirely, will be to cut numbers of employees and the hours of those remaining.  Thus many of these current employees will be put out on the street (in their vans...?) and join the hordes already looking for those now-more elusive jobs.  Welcome to the brave new world.  
And this is a big part of Economics 101.

 

[Optimistic Paranoid]

BTW, in NY, they are also fighting for a $15 minimum wage, but not for everyone, only for workers in fast food restaurants.

The nursing home industry here has already claimed that if it goes through, it will make it harder for them to hire people to take care of Grandma. Or drive their costs way, way up, which the government will have to subsidize with our taxes.

Regards
John

 

[pros80]

Aghh what the heck did I just start. I guess I'll lean on the side that it won't benefit a van dweller in California if the minimum wage goes up since costs could soar. If its just real estate that goes up and you can still shop for food and eat at lower cost that would be ok.

 

[GotSmart]

BTW, in NY, they are also fighting for a $15 minimum wage, but not for everyone, only for workers in fast food restaurants.

The nursing home industry here has already claimed that if it goes through, it will make it harder for them to hire people to take care of Grandma. Or drive their costs way, way up, which the government will have to subsidize with our taxes.

Regards
John

While in college, I wrote a grad level paper on ALF homes. (Assisted Living Facility)  After all factors were figured in, they had almost a 50% profit margin.  Most of the income was off of the government payments from Medicare / Medicaid.  I lost that file when I changed computers.  Format change ate my homework. 

Wages for the staff was an extremely small percentage of the associated costs.  The biggest percentages went to to owners as salary and "Leaseback" shelters on equipment. 

The tax laws like every other law, needs to be rechecked as they contain loopholes that artificially inflate costs for the company's smart enough to utilize them.  I know many people that run businesses that make just enough on paper to break even.  Meanwhile the owner is living on easy street complaining about the peanut butter his employees eat because they can not buy lunch. 

I had one boss that is making $1,000,000 a year after taxes.  The company buys him a new car every 6 months. The last one was a Mercedes SUV.  He hires his kids at $50 an hour to do "landscaping" and his regular workers make $8.00 an hour.

 

[ZoNiE]

Well, Blaming Walmart and Trump is pretty selective. Wonder why you never mentioned Disney, Soros, Jobs, Gates....

How about holding both political parties responsible for the jobs being shipped overseas because the stock owners wanted more profit?

and whipping the public which didn't want to pay $125 for a pair of shoes...

This is the problem. People don't want to pay what something is worth, if made here, so mfg goes overseas to ensure we get what we want for less and retailers profit. This is the crux of the problem.

There is another category of people who get hit hard by minimum wage hikes of 50%. People like me who earn more than the new minimum wage, but not significantly more. My income will not go up 50% over the next five years. I'll be lucky if it goes up 20%, really lucky. A minimum wage hike like this will effectively mean a pay cut for me in terms of the actual real world value of my take home pay.

First, for those of you who don't already know, I live and work in California.

I ran some numbers after my last post comparing what I earn now against what I earned when I started my current job back in 2000. Bearing in mind of course, that my pay raises over the years have been merit based and I consistently get exemplary performance reviews. Without accounting for inflation my hourly wage has gone up 33.3% in the last 16 years or roughly 3.2% per year. Minimum wage employees have seen hourly wage pay go up by 42.5% or about 3.6% per year in the same time period. Without disclosing any figures on what I actually earn, even with a 33.3% increase in my wages, my income relative to the California minimum wage has gone down by roughly 4.4%. I'll grant that it's not a huge figure, but if my pay continues to go up at 3.2% per year over the six year period of the minimum wage hike, I'll be earning 20.8% more than I make now while Minimum wage employees will see a 7% per year increase or 50% at the end of the six years. When all is said and done, my hourly wage will effectively have gone down a further 19.4% relative to the California Minimum wage.

I'm making a few assumptions here regarding my potential pay raises over the next several years, but if Minimum wage continues to go up at this rate, I'll be a minimum wage employee well before I'm ready to retire.

Exactly! People currently earning $14-16 per hour, with college education, even, will not benefit, and those who did not work hard to better their situation will benefit. artificially inflating minimum wage will erode the middle class even more. People need to remember that fast food jobs are starter jobs, for high school kids, Not career choices for adults.

These jobs also do NOT give full time hours any longer due to tax burden and benefits costs, and raising the wage artificially will further worsen this. People at this pay scale are already working two jobs without the benefit of overtime. In Seattle, where this already happened, people who benefitted are already asking for Hour cuts so they can retain their state benefits. They have their cake and are eating it too. They get more money for less work, and still cost us middle class folks in taxes and higher cost of goods.

 

[sephson]

First, for those of you who don't already know, I live and work in California.

I ran some numbers after my last post comparing what I earn now against what I earned when I started my current job back in 2000. Bearing in mind of course, that my pay raises over the years have been merit based and I consistently get exemplary performance reviews. Without accounting for inflation my hourly wage has gone up 33.3% in the last 16 years or roughly 3.2% per year. Minimum wage employees have seen hourly wage pay go up by 42.5% or about 3.6% per year in the same time period. Without disclosing any figures on what I actually earn, even with a 33.3% increase in my wages, my income relative to the California minimum wage has gone down by roughly 4.4%. I'll grant that it's not a huge figure, but if my pay continues to go up at 3.2% per year over the six year period of the minimum wage hike, I'll be earning 20.8% more than I make now while Minimum wage employees will see a 7% per year increase or 50% at the end of the six years. When all is said and done, my hourly wage will effectively have gone down a further 19.4% relative to the California Minimum wage.

I'm making a few assumptions here regarding my potential pay raises over the next several years, but if Minimum wage continues to go up at this rate, I'll be a minimum wage employee well before I'm ready to retire.

Just making some corrections to my figures here.

After double checking my math, my income has gone up 66.7% over the last sixteen years while the California minimum wage has gone up 73.9% in the same time period. Despite this, the minimum wage employee's buying power has, at best remained static, while those in my income bracket have seen our purchasing power decline and will see it decline even further relative to the increased minimum wage.

 

[GotSmart]

Just making some corrections to my figures here.

After double checking my math, my income has gone up 66.7% over the last sixteen years while the California minimum wage has gone up 73.9% in the same time period. Despite this, the minimum wage employee's buying power has, at best remained static, while those in my income bracket have seen our purchasing power decline and will see it decline even further relative to the increased minimum wage.

Meanwhile your productivity has more than doubled.  Costs and rents have skyrocketed.  Rents have tripled in that time. 

Someone is making money, but nobody seems to admit to being the one.

 

[sephson]

Here's a document from the U.S. Bureau of Labor Statistics published in April of 2015 that's worth a look:

http://www.bls.gov/opub/reports/cps/characteristics-of-minimum-wage-workers-2014.pdf

It's a little tough to find general statistics because all the tables are broken down into categories. I found the general statistics after a bit of digging. First these statistics are all relative to the Federal minimum wage rather than the California minimum wage. If I'm reading the table s right, nationwide, 3.9% of workers earn minimum wage or less. In California, it's 1.2%, again relative to the Federal minimum wage. I wish I'd been able to find statistics specific to the California minimum, but no such luck.

 

[jimindenver]

Should a business not be able to support a living wage, then perhaps they should not be a business.

 

[pros80]

Moderators should close this thread. Its going off topic from mobile living and if the minimum wage increase can help.

 

[Marie]

Jim, I'm pretty sure a business could re-organize and be able to support a high minimum wage. The re-organization would, of necessity, include raising their prices for goods and services. You and I would be the ones paying the price!

 

[Optimistic Paranoid]

Jim, I'm pretty sure a business could re-organize and be able to support a high minimum wage. The re-organization would, of necessity, include raising their prices for goods and services. You and I would be the ones paying the price!

And what happens if the neighboring states, in this case OR, NV, and AZ DON'T raise their minimums?

Their prices stay low, people near the borders flock there to shop, and the CA businesses close to the borders can't compete and go out of business.

Regards
John

 

[jimindenver]

At one time we had employees. When the economy tanked the customers wanted lower prices that would not cover the expenses and we had to close that branch down. Customers were not happy but they wanted smaller invoices. Employees were not happy but they would not have been happy with a pay cut either.  

In the end most of the employees got lower pay jobs. The customers had to hire services that looked cheaper but the bills added up to more. I was the winner with much less stress.

 

[highdesertranger]

I see most of the responses understand what's going to happen, only a few don't. as far as how do low income people make it in CA. they cut corners they cram multiple generations and families in one house/apartment, don't get all huffy this is not about any ethnic group this is across the board. many people work more than one job and many work under the table, again across the board. large portions of CA cities are what we used to call slums, not anywhere were people actually choose to live. everything in CA is expensive, if you don't believe me just come here for awhile. btw CA border business is already suffering go to any of the border cities large and small and check it out. why would you buy gas at 3 bucks when you can drive 1/2 mile and get it for 2 bucks. food is the same way. highdesertranger

 

[mockturtle]

I don't even drive through California any more.

 

[sephson]

Can this be an advantage for van dwellers who take retail or other minimum wage jobs in the state? Live in the van save on rent and save money for travels by working a minimum wage job etc..

Getting back on to the question at hand, I really don't think the raise in the minimum wage will be particularly advantageous to van-dwellers in California, in part for reasons already stated by others, specifically due to the price of goods and services being higher in California than in neighboring states. Another, possibly more important reason, totally unrelated to the minimum wage is that most of California, especially the more populated areas where work is more likely to be available, go a step or two beyond being unwelcoming to van-dwellers and into outright hostile territory. Is the extra money worth paying higher prices for just about everything? Is it worth the hassle of dealing with local ordinances that make it illegal to sleep in a vehicle?

It's my job that keeps me here. I love what I do and don't want to look for something else, otherwise I would give serious thought to abandoning California altogether.

 

[buckwilk]

Economics doesn't respond to laws passed by ignorant lawmakers in the way they anticipate. Most business in the world pass costs and expenses on to the customer. The government is not an exception in this practice. When laws are passed on businesses ability to do business, not only do they suffer, but more importantly, their customers suffer. The governments of the world gather support from the masses by punishing business at every opportunity. The people don't understand economics so they think businesses are their enemy, when in fact it is government that complicates their life and increases the cost of living.