Shouldn't minimum wage just increase proportionately to inflation?
Shouldn't minimum wage just increase proportionately to inflation?
Most jobs will give you a performance review and a raise every year to account for inflation and any increased duties you've taken on. We increase minimum wage by massive amounts after far too many years which causes all sorts of economic concerns, business complaints, and just a bunch of arguments everywhere. Shouldn't they just increase minimum wage 3.5% or whatever, every single year?
It depends on the goal. Are you trying to ensure a sustainable working class that can afford to support themselves and earn the wages of decent living? Or are you trying to create an exploitable poverty class that can be sapped for profit by oligarchs without admitting it?
Asking the tough questions.
https://highlanderjuan.com/wp-content/uploads/2019/05/William-Cooper-Behold-a-Pale-Horse.pdf
I believe the first two chapters of that book may answer that question.
Yeah, but then how would capitalists exploit you?
See, if it doesn’t increase with inflation then there is a good chance they can delay giving you an adequate raise for a long time. And, when they do give you a raise, you’ll probably just need to accept less than if you had been receiving them all along.
I hope you’ll consider the capitalist here. He does need to create endless revenue growth, even if that means squeezing his employees until they can’t afford to live.
They already lie about inflation to make it look like the economy isn't in dire straits. Indexing minimum wage to inflation would make them lie even more.
Got to think about those poor business if they have to pay a nickel more for labor they would be broke
Joking aside, minuim wage is a hot issue. One side fully believes that minuim wage is in fact a bad thing and shouldn't exist. So for them putting a bill out that auto raises it would be counter productive to
their interestsbusiness being able to hire with supply demandIf a business cannot function while paying a decent wage it should not exist.
Businesses with unrealistic business plans fail everyday, it is a basic function of capitalism.
It is not a society's responsibility to prop up business ventures that waste capital by continuing to pursue uneconomically viable enterprises.
Cost of living adjustments need to become a regular and expected demand from workers. Because yes, if they conveniently fail to give you a raise that at least meets inflation every year, they are effectively cutting your pay in a way that the legal system has absolutely no problems with.
Edit: Not just minimum wage, ALL wage. Inflation adjustments are the bare minimum for the company to be maintaining your value. Performance raises etc. need to happen in addition to that.
The minimum wage should include 1 voting share upon the worker joining the company that can only be given up by leaving the company. No voting shares should be held by anyone that isn't currently working at that company
Economists think that directly tying wages or prices to inflation can cause inflationary spirals. CPI is based on prices, and raising wages will eventually raise prices and CPI, so if you raise wages based on CPI, it can enter a positive feedback loop.
It might be ok if the feedback is slow enough or if the minimum wage influences a macroeconomically insignificant proportion of wages.
Economists must think Belgium doesn't exist. See this document explaining how automatic indexation happens for all Belgians (including those on pensions) without there being a higher inflation than in the other countries: https://www.abvv.be/sites/abvv/files/2023-01/Index_EN final.pdf A lot of it is: we simply get the raise a little quicker and without a fight, and only have to fight for real wage increases. Where in other countries they need to wait for the next wage negotiations and then fight to keep the real wage and hopefully increase it too.
Belgium is probably also macroeconomically insignificant in the euro zone
We definitely don't want that, since that hurts everyone, sapping value from wages and savings. I'm definitely not an economist. I was just thinking about how long we go in-between minimum wage increases and how it impacts prices every time it goes up. I was wondering if it would have less of an impact if it was raised incrementally instead of sudden big increases.
I was wondering if it would have less of an impact if it was raised incrementally instead of sudden big increases.
It probably does yeah. You can clearly learn sth about power within our system by seeing which jobs adapt their wages to inflation first. Aside from the ones who are in high demand anyway.
The quick answer is cola should be built into the system. Neither party has taken minimum wage laws seriously. States have taken it more seriously than the feds. All jobs should be required to give a cola increase every year.
I'd be okay with that, but only if it is diet.
Yup
Let's tie it to company revenue
But what is profits don't go up that same 3.5%?
If the company isn't growing at the rate of inflation and they have to pay the workers more, they have to cut something to grant that pay increase.
So, I'd ask do you want layoffs for some and the cost of living increase for the rest or no raise?
To paraphrase FDR: "If any business requires it's employees to subsist on less than a thriving wage, they deserve to not exist in the US."
I would have put the period after the word exist, but that's just me.
If the business cannot afford to operate, then they shouldn't. Full stop.
So, yes. Gimme those sweet, sweet layoffs. Let's watch the whole business implode while we're at it.
I put to you that minimum wage should be the minimum amount people need to live and that companies that can't cope with that overhead should go out of business or adjust their business plan accordingly because otherwise they are causing harm to their employees.
I do understand that will indeed increase unemployment for a time, but there are many major corporations with record profits whose bottom tier employees are already subsidized by the government because they can't afford to live.
I think we do need a better support structure to help people who are unemployed for any reason. I get that this all puts stress on companies, but in 2023 companies need to face more pressure to care for the people who make their profit possible, IMO.
Minimum wage needs to be tied to inflation because otherwise it is divorced of meaning and no longer keeps our fellow citizens alive.
Neither. There is absolutely no excuse for the obscene compensation that CEOs and other executives receive. Quit letting the most sociopathic members of society (who, in all honesty, do not benefit society as a whole - they have a unquestionably negative effect on the lives of those around them) exploit the very people their company relies on to even exist. Give the bloody profit to those that, you know, ACTUALLY EARNED IT. And while we're at it, the function of CEOs have actually been rendered irrelevant due to utterly corrupt rulings by our Supreme Court, so get rid of them. Since they are now required to only ever choose profit, their entire role can very easily be automated.
In short, your entire argument is specious.