I watched the latest edition of the “State of the Union Address” and was intrigued by the Presidents comments about minimum wage.
There is some activity on the hill in Washington to raise the minimum wage to $10.10/hour. This amounts to a$2.85/hour raise for those people getting paid minimum wage.
The President intimated that the raise would improve employee moral, which would increase productivity, thus improve the bottom line, thus boost our economy.
My curiosity got the best of me, so I looked up some statistics from the Bureau of Labor Statistics. Let me share some of my findings from the 2012 published data.
In 2012 there were approximately:
- There were approximately 75.3 million hourly employees
- 3.5 million people working at or below minimum wage.
- 2 million of these people are employed in jobs that are exempt from the minimum wage (employees receiving tips)
Let’s digest these statistics a bit.
- The 3.5 million people working at or below the current minimum wage comprise about 4.7% of the hourly employees.
- These same people represent about 2.8% of all employees
Some other news.
19 states have enacted minimum wage laws that exceed the Federal minimums.
Exactly who are the minimum wage employees? What impact do they have on productivity and the bottom line?
Here are a few of the minimum wage jobs:
- Greeter at big box retailers
- Bus-Boy at Fast Food eateries
- Day Laborer for temporary employment
These are not positions that offer opportunities for increased productivity. They require basic skills to succeed.
Are we screaming “Wolf” on this topic?
I don’t want to misunderstood. People deserve to earn a fair wage. Is the solution to increase minimum wage? Does it stand to reason that when and if minimum wage is increased, the next tier of employees currently making $10/hour will seek a raise to say $13/hour and then the next level up wants more….Where does it stop?
As a parting shot, what would happen if we went on a wage reduction cycle. Why should pro-athletes receive millions of dollars? Are actors and entertainers worth their high priced incomes? What about CEOs and executives, are they worth the big salaries?
Have we truly considered boosting the economy by spending less?
That’s the way I see it