Is the minimum wage too high?

[room305]

Why should my tax go towards paying for health care, welfare payments, etc for those not clever enough to get a well paid job or with enough get up and go to get a second job.

The minimum is way too high in this country and for some reason people seem unable to comprehend that a high minimum wage simply equals higher inflation and less jobs - not more high paying jobs.

If a business is seeking to profitably exploit low skilled labour but cannot do so at the minimum wage rate, then the business will not be viable and those jobs will never be created (or the business will more to a country where low skilled labour can be profitably exploited).

I imagine there are many businesses that do not expand and remain family only businesses as a consequence of the high minimum wage. A worker with low productivity may never get the chance to increase their productivity (and consequently their wage packet) through training and experience simply because the initial barrier is set too high.

The market will set the price for labour, there should be no need for government price fixing.

 

[Gautama]

The Des bishop programme was a load of rubbish as it ignored that fact that only 3% of our population are on the minimum wage and most of them live with their mother.

I thought his stint in Dublin was quite good, how he was living in a bedsit and didn't have any spare cash. With no spare cash, he couldn't go out to the cinema, etc. The prospect of having, say, a girlfriend, was impossible. It made me think. I wouldn't describe it as rubbish. I reminded me of being unemployed. Dunno about you?

 

[Purple]

I remember having a half stone of potatoes, a pack of rashers and a turnip to do me for three days.... yes, I know what it's like to have no money.

 

[MrMan]

If a business is seeking to profitably exploit low skilled labour but cannot do so at the minimum wage rate, then the business will not be viable and those jobs will never be created (or the business will more to a country where low skilled labour can be profitably exploited).

That comes across as more of an argument in support of the minimum wage. Exploitation = bad.

 

[madisona]

If a business is seeking to profitably exploit low skilled labour... The market will set the price for labour, there should be no need for government price fixing.

Indeed. I suppose it depends on how much our society wants to profitably exploit workers. cutting the min wage would also need to involve cutting welfare payments, as even as it is there are many who would be better off on welfare than working at min wage levels (if travel costs, loss of other benefits etc are taken into consideration) you are also btw not taking into consideration that the less you are allowed to pay your workers the less that they will have to spend on goods and services.


How about we allow child labour but exempt employers from having to pay them the min wage. After all surely business profits (which will of course tricke down and benefit everyone) are much more important than the quality of life of the stupid, lazy people in the lower classes.

 

[Purple]

Indeed. I suppose it depends on how much our society wants to profitably exploit workers. cutting the min wage would also need to involve cutting welfare payments, as even as it is there are many who would be better off on welfare than working at min wage levels (if travel costs, loss of other benefits etc are taken into consideration) you are also btw not taking into consideration that the less you are allowed to pay your workers the less that they will have to spend on goods and services.

Allergan in Arklow is a prime example of why high wages in our economy are a problem. This is a profitable plant with a highly skilled workforce but they are still too expensive.

How about we allow child labour but exempt employers from having to pay them the min wage. After all surely business profits (which will of course tricke down and benefit everyone) are much more important than the quality of life of the stupid, lazy people in the lower classes.

Who are the lower classes and why do you think they are stupid and lazy?
You show a lack of understanding of economics when you imply that business profits and quality of life are not compatible.

 

[madisona]

You show a lack of understanding of economics when you imply that business profits and quality of life are not compatible.

really. Tell that to the child workers who labour 14 hrs a day in sweatshops to produce Nike runners or Tesco jeans. Although a balance has to be struck one of the things that is worth protecting in our society is that workers are protected from undue exploitation by greedy business interests. The minimum wage and health and safety regulations are important elements of this protection.

I don't buy the arguement that these protections should be watered down to allow multinationals to make greater profits. nor to I buy that workers owe employers or the scare tactics that say that worker protections have to be eroded in the name of competitivity.

The child labourers in sweatshops are "competetive" but I don't think that it fills them with great joy.

 

[Purple]

really. Tell that to the child workers who labour 14 hrs a day in sweatshops to produce Nike runners or Tesco jeans. Although a balance has to be struck one of the things that is worth protecting in our society is that workers are prevented from undue exploitation by greedy business interests. The minimum wage and health and safety regulations are important elements of this protection.

I don't buy the arguement that these protections should be watered down to allow multinationals to make greater profits. nor to I buy that workers owe employers or the scare tactics that say that worker protections have to be eroded in the name of competitivity.

The child labourers in sweatshops are "competetive" but I don't think that it fills them with great joy.

Who's talking about child labour and sweat shops?
Talk about a straw man argument!

The question is if our minimum wage is too high. From a purely economic point of view I think it is but given that we are a society and not just an economy do the social benefits outweigh the economic costs. This isn’t a question of should businesses be allowed to hide roughshod over the rights of employees, it’s a question of at what level should the balance be struck.
Take off your ideological hat and put your bias aside for a minute and address the issues.

 

[madisona]

Who's talking about child labour and sweat shops?
Talk about a straw man argument!

The question is if our minimum wage is too high. From a purely economic point of view I think it is but given that we are a society and not just an economy do the social benefits outweigh the economic costs. This isn’t a question of should businesses be allowed to hide roughshod over the rights of employees, it’s a question of at what level should the balance be struck.
Take off your ideological hat and put your bias aside for a minute and address the issues.

exaggerating to make a point. you were the one that implied that business interests and quality of life for workers were usually compatible. I don't think that they are. Of course there is a balance but imo the social benefits of the minimum wage and protection for workers from employers outweigh the concerns of business interests to have lower labour unit costs and greater profits .

I doubt that many of those who are argueing on this thread that it is too high have had to raise a family on it.

 

[Sunny]

I can see the economic argument behind people saying that it is too high and it might be stopping jobs being created but on the flip side I also don't believe many peoples ideas on this thread that many people who are in minimum wage jobs are there because they are lazy or lack ambition or desire to work themselves into a better job. The way I look at is that if people are taking minimum wage jobs, I like to think that these people WANT to work or otherwise they could just claim benefits. And I don't have any research to back it up but I presume the majority of people in these jobs come from our most vulnerable parts of society e.g. single parents, people from disadvantaged social backgrounds, people with disabilities, people with dependants, homeless people etc

Not sure if this is the saying but someone said a Country's success should be judged on how the most vulnerable parts of its society lives. I agree with this and is why I think the minimum wage should be as high as possible. And I come from a good capitalist economic middle class background!!

 

[Purple]

exaggerating to make a point. you were the one that implied that business interests and quality of life for workers were usually compatible. I don't think that they are. Of course there is a balance but imo the social benefits of the minimum wage and protection for workers from employers outweigh the concerns of business interests to have lower labour unit costs and greater profits .

Why do you think that low wages mean high profits? Unually low wages mean low value add jobs and low profits. By increasing these wages we don't cut profits, we just loose jobs.

I doubt that many of those who are argueing on this thread that it is too high have had to raise a family on it.

I agree. I am not argueing that it is too high, I am asking the question. You are making an idological point and ignoring the question.

I can see the economic argument behind people saying that it is too high and it might be stopping jobs being created but on the flip side I also don't believe many peoples ideas on this thread that many people who are in minimum wage jobs are there because they are lazy or lack ambition or desire to work themselves into a better job. The way I look at is that if people are taking minimum wage jobs, I like to think that these people WANT to work or otherwise they could just claim benefits. And I don't have any research to back it up but I presume the majority of people in these jobs come from our most vulnerable parts of society e.g. single parents, people from disadvantaged social backgrounds, people with disabilities, people with dependants, homeless people etc

I agree and hope the same thing.

Not sure if this is the saying but someone said a Country's success should be judged on how the most vulnerable parts of its society lives.

I have posted that comment on AAM a number of times.

I agree with this and is why I think the minimum wage should be as high as possible.

So do I, my question is what level is as high as possible? €2 is too low, €50 is too high, is €8.65 too high?

 

[Sunny]

So do I, my question is what level is as high as possible? €2 is too low, €50 is too high, is €8.65 too high?

That I can't answer. I suppose the floor is what someone can earn from jobless benefits. Where should the ceiling be from a economic point of view? I honestly don't know but I would find it hard to begrudge anyone €8.65 a hour for a decent days work.

 

[manus]

I work in the maintenance dept of a multinational pharma company. we were at a meeting recently about costs per head etc of employees. apparently it is far cheaper for the company to pay staff very high wages and hold onto them than to pay low wages and have the risk of them moving on, the reason being is that training and upskilling staff is very expensive for the company.

 

[madisona]

some of the wealthiest people in the country will be taking an expensive action in the High Court on Feb 5th to challenge the JLC provision which forces them to pay 22c an hour more than the minimum wage to their workers. The Irish Hotel Federation will be arguing against the constutionality of the requirement.

The multi millionaires have dismissed the contention that the 22c in partly to compensate for the unsocial hours worked by their employees and are claiming that their wages need to be cut to remain competetive.

The tourism industry generates €6.5 billion in revenue each year and attracts a large amount of state investment.

 

[Purple]

some of the wealthiest people in the country will be taking an expensive action in the High Court on Feb 5th to challenge the JLC provision which forces them to pay 22c an hour more than the minimum wage to their workers. The Irish Hotel Federation will be arguing against the constutionality of the requirement.

The wealth of the owner has no bearing on the profitability of a hotel. Why do you seek to link the two?

The multi millionaires have dismissed the contention that the 22c in partly to compensate for the unsocial hours worked by their employees and are claiming that their wages need to be cut to remain competitive.

Ask an American or European tourist if Ireland is good value and see what they say. Personally I think it's a low paid industry with bad hours and little security but my opinion does not change the economic reality that the industry faces.

The tourism industry generates €6.5 billion in revenue each year and attracts a large amount of state investment.

What's that got to do with the question? The size of a sector has no bearing on whether wages or margins are too high or too low.
Nothing in your post addresses the question; At what level does the economic damage caused by a high minimum wage outweigh the social benefit?

 

[madisona]

The wealth of the owner has no bearing on the profitability of a hotel. Why do you seek to link the two?

At what level does the economic damage caused by a high minimum wage outweigh the social benefit?

And does the profitability of a hotel have any bearing on the wealth of the owner

you are automatically assuming that a high minimun wage causes economic damage. it will also give workers more money to engage in economic activities and purchase goods and services, encourage employers to operate more efficiently and stimulate competition and limits excessive profits. In the eighties with no min wage we had a depression and mass unemployment. Now with one of the highest min wages in the world we have close to full employment

In the example above the hotel worker is more likely to spend the extra 22c in the local economy than the millionaire hotel owner.

 

[Purple]

you are automatically assuming that a high minimun wage causes economic damage. it will also give workers more money to engage in economic activities and purchase goods and services, encourage employers to operate more efficiently and stimulate competition and limits excessive profits. In the eighties with no min wage we had a depression and mass unemployment. Now with one of the highest min wages in the world we have close to full employment

Are you seriously suggesting that a high minimum wage is a cause of the economic success that we had from the mid '90s 'till the last few years?
We are a trading nation; high costs are bad for all of us.

You have still not addressed the question so can I take it from your other posts and the numerous straw man arguments that you have made that you don't think that the minimum wage it too high and that in fact you think that the higher it is the better it is for the economy?

 

[z103]

That I can't answer. I suppose the floor is what someone can earn from jobless benefits. Where should the ceiling be from a economic point of view? I honestly don't know but I would find it hard to begrudge anyone €8.65 a hour for a decent days work.

I would, and have. (€8.65 is €18k a year.)

Only a few weeks ago we were doing the maths and decided against an expansion because it would cost too much to hire someone. We wouldn't make enough profit to make the venture worthwhile.

The 'problem' isn't just minimum wage. It's just too expensive in general to hire Irish labour.

 

[Purple]

I would, and have. (€8.65 is €18k a year.)

Only a few weeks ago we were doing the maths and decided against an expansion because it would cost too much to hire someone. We wouldn't make enough profit to make the venture worthwhile.

The 'problem' isn't just minimum wage. It's just too expensive in general to hire Irish labour.

It's too expensive to pay someone a wage that's too low to live on... says a lot about where we have arrived at in this country...

 

[room305]

Tell that to the child workers who labour 14 hrs a day in sweatshops to produce Nike runners or Tesco jeans.

And without the opportunity to work in 'sweatshop' what would those children be doing do you think?

I'm not condoning child labour - it should be illegal everywhere. However, in all the anti-globalisation hysteria about foreign labour sweat shops, people often ignore the fact that sometimes even horrendous factory conditions can be better than the alternative of attempting to eek out subsistence living on farmland.

One time all we had to offer the world was cheap labour as well.