What Is a Just Wage?

[PetraG]

When you are talking about fast food joints, if they doubled their wages and doubled their prices, people would just eat at home or brownbag it into the office.

Would the thousands of fast food people be better off not working at all?

Actually, the people who have run the numbers say that raising the minimum wage to $15 would raise fast-food prices by less than 5%. For instance, McDonald’s paid $15/hour it would increase the price of a Big Mac from $3.99 to $4.16. (That calculation does not make an allowance for the cost savings of lower turnover.)

If people were careful with their food budget, they’d be brown-bagging it or homemaking it already. I don’t see an increase in prices of less than 5% making much of a difference.

 

[Xanthippe_Voorhees]

Xanthippe_Voorhees:

See the issue with this is when communitities mesh.

For instance, major cities. People want to live and work in a major city. Living costs skyrocket. Outside that city prices are lower-more land. other industries pop up that pay lower wages, but those wages aren’t enough to live in that community. So you have People in City A being paid a wage that’s enough to live in City A, but living far away in city C,D,E so as to have more land, have a bigger family, etc. City B gets some industries but those who work in city B could never live in city A. So you have people from city J living in often terrible conditions, far from the social supports in city A having none of the benefits.

Yes indeed. It can get pretty complicated. However, the principle still stands.

But it can’t really be a principle when fostering such different wage considerations? How do employers know and budget for that? What if there are other considerations with public transit that takes people from over an hour into the city? What if a new line is built. If Big City Office is paying $$$ to encourage people to live within 45 minutes of their job and then all of the sudden cheap Podunkery (formerly 1.5 hours away) gets light rail and it’s 45 minutes does Big City Office cut Podunkery citizens’ paychecks? And what about Podunkery area employees. Rents go up but people who owned their home see no tangible benefits unless they want to move. Too many factors.

I’m in New England. We’re affected by NYC and Boston as well as in some respects from cities in Connecticut, Albany, Burlington and Portland (ME). The difference between what $2k a month will get you in the rural part of every state (except RI becuase there’s no rural RI) and what it will do near a city. Western MA, Northern NH and ME, most of VT and parts of CT 2k could mean a nice 2-bedroom 1200sqft $800 rental, money for food, a car or two and enough to get by hand-to-mouth. In the metros–near Boston, NYC, Portland, Burlington $2k might get you a 400sqft studio in a terrible neighborhood. No food, utilities, no vehicle or transit–nothing–2k for barely enough room for one person.

So what to do when these places are a 2 hr or less drive from eachother?

Maybe the rest of the US is better but

 

[Cruciferi]

I’m just happy commuting 5 minutes to work for the County Government I have it made in the shade

 

[0Scarlett_nidiyilii]

Well, let’s put it this way–there nothing wrong with the bosses making more than the employees.
But when there’s an enormous wage gap between the bosses and the employees, yeah, I do see a problem with that.
The mom and pop simply can’t afford to pay more. But the corporation shouldn’t be greedy and withhold higher wages simply because they can.

 

[otjm]

You are making, for lack of a better term, a false positive. It is not that people with a college degree now need a Masters; it is that with a college degree, in Liberal Arts (of which there are far, far too many), they are not in need of a Masters; they are in need of something specific which can be applied to specific jobs. History majors, Philosophy majors (I have one of those), English majors, American Studies majors (one of my daughters), general Liberal Arts (my other daughter, however she had a minor in Editing) are all largely non-specific. The student graduating with one of those hopefully (and generally) is more mature than a student with a high school diploma, and (at least theoretically) has been taught to think and to reason, characteristics which may be useful in, for example, in processing medical insurance claims (my first daughter mentioned - she is now making $40,000/year, and enjoys the challenges). My other daughter was hired by a software firm as a customer service rep (aka an in-house call center). She had the initiative to ask if she could re-write thei manual they used for problem solving calls; when she presented her re-write, she was on the spot offered a job as a technical writer.

One of my son-in-laws is a mechanical engineer with a company which designs and makes medical devices, and has several patents. However this was his second job in engineering; the first was with a firm which was independent of, but did work for a Fortune 500 company until the company sneezed, and the firm got pneumonia. 8 months later (and thanks to connections) he was hired again - three states away from the first job. He would prefer aeronautics or robotics, and both require a Masters; but that has been pretty much the status for the last 15 years.So no real change in the qualifications.

On the other hand, skilled jobs - carpentry, electricians, pipefitters (usually part of HVAC) are begging for anyone with the skill set and training - and because in our ultimate wisdom from on high, high schools have lost their “shop” classes, and too many 2 year (Junior) colleges have turned into a grownup high school college prep for those who got a high school “degree” of little worth. Yes, some teach skilled courses, but they are producing far fewer graduates than the trades need.

Someone I dated in high school went to college and got her Bachelors of Science in Fisheries and Wildlife Management in the 1960’s; even then those with only a BS were the field technicians and gatherers of information for any research; the research was done by those with an MS or PhD. So no big change there either.

 

[redbetta]

Totally flies in the face of the “well-rounded” person ideal high schools and colleges are pushing nowadays.

 

[po18guy]

Freedom demands that it a a wage agreeable to both parties. As with letting our yes be yes, and our no, no, adding to this seems to insert the devil into the details.

 

[blackforest]

Grown adults don’t belong in low-skill, entry level jobs. I wouldn’t hire them. If you are an adult and working at the same skill level as a high schooler, then you have failed in life.

You don’t know who among these low-wage workers struggles with unseen intellectual disabilities or mental illness, who’s trying to clean up after a past felony after no one else would hire them, who is a refugee starting anew in this country, or who got pregnant and - God love her - refused to have an abortion in the face of a lot of pressure and is now struggling to provide for her baby. You don’t know who never made it to high school classes because they were busy caring for a toddler while a drug-addicted parent slept all day. You don’t know people’s stories.

So I’m sorry to hear you judge every adult low-wage worker as a failure. I don’t see any of the people in my examples as failures; on the contrary, I see them as brave and resilient. I was raised never to look down on people based on how much money they made or what they did for a living. I hope that you can one day see things the same way.

Nobody who works hard should have to struggle to pay rent or put groceries on the table. Nobody. That is the essence of CCC 2434.

 

[otjm]

They appear to think it will come from the same sort of places that will pay their college tuition…

 

[0Scarlett_nidiyilii]

Nobody who works hard should have to struggle to pay rent or put groceries on the table.

While I know what you’re getting at–how about people with skill sets where the jobs are few?
For instance, my professional actor friends literally never know where their next gig is coming from. They work very hard at their craft, but there are about a zillion actors and very few middle-class wage acting jobs.
Can we make the case that the employee also has to bring something valuable to the table?

 

[blackforest]

If we’re talking about unemployed actors, their current between-gigs job should pay them a just wage until they can find a job in their field. That’s just Church teaching talking, and the Catechism does guide our public policy advocacy as Catholics. Obviously, there’s no gig-job to pay them, so that wouldn’t apply to this case.

They’re the butt of far too many want-fries-with-that-order jokes, but I have heaps of admiration for actors. The professionals pursue their dreams with tenacity and courage and aren’t too elitist to take those hard-working, low-skill “failed in life” jobs until they find their gig.

 

[otjm]

Well, let’s talk about numbers, since you bring this up.

Let’s say that the owner of a fast food store has 20 effective full time employees at an effective rate of $10/hour ( it is a bit above minimum wage, to include a new manager).

Actually the owner will pay 13%+ more, because they pay Social Security as well, along with Workers Comp Insurance. So that works out to a yearly payroll of $470,080.

And that is only payroll. It does not include franchise fees, rent on the property, payments on equipment, payments for the actual food produced, any bonds which the state or local jurisdiction require, and any loans to get into the buisness, just to mention some of the more obvious costs.

And so after paying all of this, the owner nets, let’s say, $100,000 asa combination of salary and profit.

So you complain that he makes too much? He doesn’t work a 40 hour week; more like a 70 hour week.

That works out to about $27.42/hour (he does not get any overtime).

Oh, and if this was a McDonald’s, he has to find some place where there is no McDonalds, and then the company is going to build the store, and he is going to pay rent on it. In addition, McDonald’s isn’t even going to talk with him about a franchise if he does not have at least $500,000 in cash (and that can’t be from a mortgage on his house, or any other loan). If he buys an existing McDonald’s, recent costs for the purchase (over and above any franchise fees) recently has been between $1,003,000 and $2,228,000. It may take as much as 40% of that amount to get a contract started. And if he has no background owning another one, no bank is likely to be interested in loaning that much to a “newbie”.

Maybe it is just me, but putting up $500,000 to (more likely) $750,000 and taking the chance I could make a go of it means that I need to see a return on my investment. Even an average of 8% return (mot definitely no all that unlikely) is $60,000. In other words, he could invest the $750,000, get a return of $60,000 and not work 70 yours a week.

Oh, but he’s rich, and we need to take away (called taxation by many, theft by others) and “give it” to the poor laborers.

So now you may want that money to go to pay higher salaries for the employees. How much are you going to take each year? 20%? Well, you took away $150,000, but divided up between the 20 workers, that amounts to about $3.61 an hour more.

Well, that is not enough so we will take 40%, giveing them all a 7.22 raise, and they all feel like they have made it.

Note: I did not say he got $160,000 per year; I said he got $100,000 (and starting out, that is far more likely than he making several hundred thousand per year).

So you want this guy, who has free cash of $750,000, to cough up 40% of that and work for $40,000 a year. I don’t think he is going to invest in a McDonalds, so guess what? 20 people have no job, because the place does not exist. You either take it out of what he needs to qualify to get the franchise, or you take it out of what he earns after he has paid ever last bill, and turned off the lights to save on electricity. (continued)

 

[0Scarlett_nidiyilii]

their current between-gigs job should pay them a just wage until they can find a job in their field

Except here’s the thing–in order to be free to take days off and go on auditions, and take extended leave if they do get a good (but probably temporary) gig, actors will take the kinds of jobs where they are easily replaced, and nobody expects to spend their entire lives in, such as wait staff.
Because of the high turnover in staff, bosses are reluctant to put too much of either salary, training or benefits into somebody who will just walk out the door in a moments notice.

 

[0Scarlett_nidiyilii]

No–I don’t have a problem with bosses and owners making more than the rank and file employees.
And obviously there is an upper limit as to what a business owner can pay their employees.
I’m talking about withholding raises when they actually could afford it–like an enormous wage gap. Or the bosses give themselves raises but not deserving workers.
During the gilded age, industrialists were building enormous mansions for themselves but using child labor and paying poverty wages. There’s not way that can be justified.

 

[otjm]

It may be a bad pun if we are talking about McDonald’s, but there is no free lunch. Giving his employees a raise in most logical scenarios, is not going to drive any business to the pickup window of the interior counter. Oh, but he is rich, so it doesn’t matter.

You may feel that he has no right to have amassed $750,000, or that he does not have a right to make a return on that money invested. Certainly, Communism backs that philosophical stance where all animals are equal (well, maybe with the exception of the cows and chickens which donated their life for menu items). Hmmm… I seem to remember a phrase coined by George Orwell (or stolen by him for his book) in which all animals are equal, but some are more equal than others. And in this case, we would be making the workers more equal than the owner.

Just some thoughts on numbers.

Oh, and to corporations: someone, or a bunch of someone’s put up a sizeable amount fo money to start a business. And almost every last one of them do it as a corporation. I presume you mean large corporations, such as Starbucks, or Walmart.

If they are private corporations, the owners of the stock want a return on their investment.

And if it is a public corporation, the other stockholders want a return on their investment in the ownership of the company. That comes with appreciation in the stock value (which goes down, like in 2007-2008, maybe 50% or more) and dividends.

And yes, I would agree that CEO’s (and a very small handful of other key employees) make way too much as a ration to the average salary. But it is false mathematics (or the complete absence of them) that presumes that if CEO salaries were reduced by 2/3s, that the employees would see even a miniscule raise in pay. Take a look at my numbers above. the more employees you have, the more diluted any pay reduction from the head shed becomes. It is basic math.

 

[0Scarlett_nidiyilii]

No probs, I still stand by my statements.
Peace

 

[Augustinian]

During the gilded age, industrialists were building enormous mansions for themselves but using child labor and paying poverty wages. There’s not way that can be justified.

That’s really not true. The great industrialists of the so called “gilded age” achieved their fortunes not by being cheap with the employees- but by technological innovation and market prowess.

Any number of would be leaders of industry failed during the same era, even though they paid no more.

Its not much different than the current age, Hills and Ames and Kmart were never better with their staffs than Walmart as far as pay. Similar with Burger Chef and Winkys who didn’t lose to McDonalds because they paid so much.

 

[DeniseNY]

Hills

I miss Hills

 

[KMC]

If businesses aren’t allowed to run on exploitation wages, they won’t be there to compete unfairly for businesses with the enterprises that pay just wages.

That’s a pretty broad statement. Perhaps you have in mind large corporations? In 2014, approximately 89% of all businesses employed less than 20 people. Fact is many of those businesses can’t run on paying wages so that a 40 year old can support his family, but instead could pay for a younger person without large expenses. If you want to force the business to pay wages the business can’t support, then you get the pleasure of adding more people to the welfare roles.

 

[KMC]

KMC:

But in this scenario, the wage itself is the discriminating factor. It supports someone who does not have a lot of financial responsibilities, which kind of meets the requirements of the CCC. In other words, its a just wage for some.

I’m not clear, sorry. Are you advocating for a tiered wage system based on individual employee circumstances?

I’m not saying that I’m not open to it, but I’m wondering about the legalities surrounding it.

I’m saying that a wage might be just for some, and given the state of the business and the contributions of the employee, that seems to satisfy the CCC. If you are looking for all businesses to have their minimum wage capable of supporting a 40 year old man or woman with a family, and all kinds of special needs (or whatever the worst case scenario is), its just not realistic. Forcing all businesses to be able to provide such a wage ignores the reality of business and would end up putting all of those employees on the government dole. Certainly, businesses capable to paying such a wage, provided the contributions of the employee justify that wage (per the CCC), should pay it.