Disney paying a “living wage”. Sigh…

[71 Truck]

Yup, that's how it used to be. And it also used to be that one salary paid more than enough to support a family. My dad worked for GM, and my mom didn't really need to work - though she did, as she likes to stay busy. But wage stagnation means that now most families need two income earners to get by, and even then it's often tight. I have a Master's degree and I've been working over 20 years - I still don't make as much money as GM paid my dad in 1990. Not inflation adjusted, the actual dollar amount.

Same thing in my family. My father was a utility worker he made more than I did but not by much.

A separate issue, but sure, many people will need to work more if they want more than the basics. My point is that a wage should at least cover the necessities.

But my question what do the basics really cost. If I want to live in The most expensive city in America and work at a fast food restaurant should I be paid based on the job or where I live.

Agreed, and it's always interesting when people think they have a good understanding of economics, but they have actually been misinformed. It's almost like it's by design.

Agreed

As an investor, I'd think that would concern you!

I am. I have watched my investment in Disney fluctuate wildly this year.

 

[GreatLakes]

Publicly traded corporations should care about all stakeholders, not just stockholders. The game Disney is playing is purely short term and it will hurt them long term. The current management team is too short term focused and lacks the backbone that other Fortune 500 CEOs have to indicate to Wall Street they will sacrifice the current quarter for the long game. It is a fallacy that every publicly traded company has to maximize shareholder return at the expense of other stakeholders. A very successful financial services company I work with as a customer publishes their three pillars in the order they take precedence. Employees, then customers, then shareholders.

That being said, Disney will pay their front line CMs badly because people are accepting it. It isn't really any different than other supply/demand relationships. In the case of labor the worker represents the supply curve and the company the demand curve. If the worker accepts the wage the company offers they are indicating they are in agreement that the wage is acceptable. Only when all the CMs, or a high enough portion of them, leave and Disney can't hire enough will they will raise their wages.

Employees tell companies how they want to be treated. If you keep coming to work you are telling them you are happy with, or at the very least begrudgingly accept, the arrangement. The same goes for the customers. If we keep going to Disney we are telling them with our dollars that we are happy with, or at least begrudgingly accept, the way they are running the company.

 

[KVH]

You know, I was going to try to explain about wages (w/o any adverbs) and the real world and then I thought "this thread is starting to go sideways like"


and I decided life is too short . . .

 

[GAN]

The CEO-"Typical" employee compensation difference in 1965 was 21-to-1, in 1989 it jumped to 61-to-1. It is now at 399-to-1. From 1978 to 2020, CEO pay grew by 1,322%, while the S&P grew 817% ....compensation of the typical worker grew by just 18.0%.

CEOs get more because they can set pay and so much of their pay is stock-related, not necessarily because they are increasing their productivity or possess specific, high-demand skills. The growth of executive compensation has fed the expansion of top 1.0% incomes, leaving less of the fruits of our economic growth for ordinary workers and widening the gap between very high earners and the bottom 90%.

So making excuses against a livable wage, or anything closer to it, is pretty ridiculous. I'm all for executive compensation, not for outright thievery. Unfortunately, too many of today's executives have only one concern -themselves.

 

[Boski]

The lack of understanding of economics in this thread is staggering . . .

To be fair economics isn't easy to understand. There are many who have MBAs from top schools or 30 yrs of experience who fail to get it.

 

[Starport Seven-Five]

Investors in a company are important for the company's health. Keeping Wall Street happy is what provides investors in a company, this will allow it to grow.

Shareholders aren't investors after the IPO is complete. Share prices have an impact on the company's ability to do certain things but it's not like my stock purchases helped pay for Tron.

I blame that solely on the fact many people just aren't interested in the jobs available. IMO many young people are looking for that perfect job.

As they should. You'll spend a decade at work in your lifetime so holding out a month for a good job is a worthwhile investment.

As an investor in not only Disney stock but many other company stocks I do not think this mentality is a problem.
This is the nature of how publicly traded companies work for the most part.
Two way a company makes money, increases sales and or cuts cost, it's that simple.
I am going to guess that most layoffs and hiring freezes are going to be at the corporate level and not front line cast members.
And the way Disney keeps increasing prices is the main reason my wife and I no longer visit the parks.

That's how they make more money. At what point is a company making enough money though? When can they afford to invest a bit more into their employees to improve the future for the company?

The problem I've observed working in publicly traded companies is that the focus is always short term. CEOs change quickly so they don't have to worry about the 10 year impact of their decisions.

In CA the push is to make minimum wage a living wage. The problem with that is minimum wage jobs are, for the most part, transitory positions. The wages paid to the people doing these jobs are what drives the cost of the item they provide. This is restaurants, stocking shelves, etc. If you increase the wage, the cost of the item they provide also needs to also increase. Consequentially, the minimum wage is no longer a living wage, and must be increased to keep up. It's a never ending cycle of inflation. You can break this cycle by just admitting that minimum wage will never be a living wage and was never intended to be. These jobs are for kids in HS and college who have health care and part of their cost of living (i.e. rent) paid for by their parents. You do these jobs to get experience and to get you through this phase of life, then move up to management or move on. You don't raise a family working at a minimum wage job.

There have been studies done on this and the impact on cost of products is negligible.

"More specifically, they estimated that a 10% minimum-wage increase leads to a 1.4% increase in the price of a Big Mac."
Source: https://www.marketwatch.com/story/what-minimum-wage-increases-did-to-mcdonalds-restaurants-and-their-employees-11611862080?mod=hp_minor_pos21&adobe_mc=MCMID=89603281908163757490338208712198153091|MCORGID=CB68E4BA55144CAA0A4C98A5%40AdobeOrg|TS=1611863651

I agree with most everything you say however as of right now, weather Disney can attract new cast members or not the average STARTING pay for a person with NO EXPERIENCE is $15.00 an hour that's $31,200 a year.
A Disney bus driver "THAT THEY WILL TRAIN" STARTS at $18.00 dollars an hour that's $37,440 a year.
All that also comes with benefits other than free park passes or discounts.
To me that is not bad STARTING pay for a job at Walt Disney World.
There are other jobs at Disney that require some training that pay better.
If people want more money either get an education/training and look somewhere other than Disney.
At some point people have to decide what is best for their family, I did.

Off the cuff $15/hour sounds like a lot but punching it into an inflation calculator reminds me that it's close to what I was making in high school at a throwaway job.

 

[GAN]

Shareholders aren't investors after the IPO is complete. Share prices have an impact on the company's ability to do certain things but it's not like my stock purchases helped pay for Tron.


As they should. You'll spend a decade at work in your lifetime so holding out a month for a good job is a worthwhile investment.


That's how they make more money. At what point is a company making enough money though? When can they afford to invest a bit more into their employees to improve the future for the company?

The problem I've observed working in publicly traded companies is that the focus is always short term. CEOs change quickly so they don't have to worry about the 10 year impact of their decisions.


There have been studies done on this and the impact on cost of products is negligible.

"More specifically, they estimated that a 10% minimum-wage increase leads to a 1.4% increase in the price of a Big Mac."
Source: https://www.marketwatch.com/story/what-minimum-wage-increases-did-to-mcdonalds-restaurants-and-their-employees-11611862080?mod=hp_minor_pos21&adobe_mc=MCMID=89603281908163757490338208712198153091|MCORGID=CB68E4BA55144CAA0A4C98A5%40AdobeOrg|TS=1611863651


Off the cuff $15/hour sounds like a lot but punching it into an inflation calculator reminds me that it's close to what I was making in high school at a throwaway job.

View attachment 719502

Just for the heck of it I did the same. In 1981 I had a job working in a restaurant while in high school making $5/hour ...the $15/hour works out to just less than I was making($4.58/hr)

 

[71 Truck]

Shareholders aren't investors after the IPO is complete. Share prices have an impact on the company's ability to do certain things but it's not like my stock purchases helped pay for Tron.

Correct your stock purchase my not have helped much however the stock purchase of thousands of other people does help to an extent. It also makes it easier for a company to borrow money for capital projects if they have a good, strong stock price.

As they should. You'll spend a decade at work in your lifetime so holding out a month for a good job is a worthwhile investment.


That's how they make more money. At what point is a company making enough money though? When can they afford to invest a bit more into their employees to improve the future for the company?

How much is enough? Is there a dollar amount or a percentage. This is why I like companies that do profit sharing with its employees. If the company makes money then everyone should either get a nice bonus or a nice raise. When unions get involved in negotiating a contract that's it, what ever cast members get they get. Sometimes that works out during bad years but not during good years. I am not saying unions are bad it is just what it is.

Every four to five years the union and Disney get together and negotiate a new contract. The last contract pay rate took appears to have taken effect on 9/24/2017 and ends on 10/3/2021.
Starting pay 9/24/2017 was $10.00 an hour. Depending on years of service in 2017 for an existing cast member pay could jump to $15.12 an hour in that year, it just depends on how long that cast member had been with the company in that year. Then after 90 days it goes as the following $11.00 to $16.12 then 180 days $12.00 to $17.12.
Then effective 9/29/2019 $13.00 to $17.87 then 10/4/2020 $14.00 to $18.62 then the last pay rate 10/3/2012 $15.00 to $19.37.
This is based on the pay rate for an attraction host from the last union contract and depending on the job the pay rates change. For instance a bus driver in under the contract as of now will make $18.00 to $22.96 depending on years of service. This is for the contract dated, September 24, 2017 through October 2022 .

So Disney is investing more into its cast members every year.

The problem I've observed working in publicly traded companies is that the focus is always short term. CEOs change quickly so they don't have to worry about the 10 year impact of their decisions.

Agreed.

There have been studies done on this and the impact on cost of products is negligible.

"More specifically, they estimated that a 10% minimum-wage increase leads to a 1.4% increase in the price of a Big Mac."
Source: https://www.marketwatch.com/story/what-minimum-wage-increases-did-to-mcdonalds-restaurants-and-their-employees-11611862080?mod=hp_minor_pos21&adobe_mc=MCMID=89603281908163757490338208712198153091|MCORGID=CB68E4BA55144CAA0A4C98A5%40AdobeOrg|TS=1611863651


Off the cuff $15/hour sounds like a lot but punching it into an inflation calculator reminds me that it's close to what I was making in high school at a throwaway job.

View attachment 719502

When I worked for Disney in September 1999 starting pay was $6.10 an hour and from what I can tell inflation was 2%.
Right now the unions are looking for $18.00 an hour to start with an inflation rate of 8.8%.
If they get it that means starting pay at Disney has tripled in roughly 23 years and inflation has quadrupled and inflation can go back down.

I am not sure what you classify as a "throwaway job" A good number of jobs at Disney require almost no training. Disney will hire you and train you for that job and just about any other within the company including some management position. Within my first three months working for Disney I interviwed for and was excepted into a pool of cast members for hotel management and I did not have a college degree. I ended up transferring to a different department doing sales. I had three weeks of training and an automatic $3.00 dollar an hour raise.

I do not think Disney's problem finding people is as much about the money as it is about not having enough people looking for work.
I was watching a news segment last night. The guest was Mike Rowe. He was telling the host as of right now for every five tradesmen who retire only two start,. that's a problem.

A lot of people have dropped out of the work force because of the pandemic and have not returned. Some have started doing their own thing to make sure that they would never loose their income again.

 

[persnickity]

Just for the heck of it I did the same. In 1981 I had a job working in a restaurant while in high school making $5/hour ...the $15/hour works out to just less than I was making($4.58/hr)

*not gonna look, not gonna look, not gonna look* (it's too depressing)

 

[DLgal]

Just for the heck of it I did the same. In 1981 I had a job working in a restaurant while in high school making $5/hour ...the $15/hour works out to just less than I was making($4.58/hr)

But let's keep talking about how $15/hr is "too much" and the Federal Minimum wage of $7.25 per hour is good enough...

I worked at a Blockbuster Video in college in 1997. This was my part time student job. I made $8.60/hr. Would be $15.97 today.

When I graduated college and got my first real job that required a bachelor's, I was making $16/hr. This was in 2001. That would be almost $27/hr nowadays or a salary close to $60k which is the high-end for that job TODAY. I started off at that wage and ended up at $18/hr a couple years later when I left that job.

Wages across the board have not kept up with inflation. It's an absolute fact, but people really like pushing the narrative that low level "unskilled" workers don't deserve to make enough to live with dignity.

 

[71 Truck]

I am glad we can have a health, civil discussion about this topic.

There are some that believe that everyone, regardless of their skill level, should make what they think is a living wage no mater where or who they work for or what they do.

There are those that think that wages should be tied to a certain skill level, kind of job done and where they live.

There has to be a middle point and a good part as to why you can't have that nationally is because it cost different amounts of money to live in different parts of not only the country but even different parts of a state.

I think Disney pays a good starting wage for the jobs listed and if cast members stay long enough they can top out at a good pay rate.
Disney offers great opportunity for transfers to higher paying jobs.
Disney also offers cast the opportunity for paid education so they can better themselves and look for better paying jobs within the company.

Some think Disney does not pay enough for cast members to live in central Florida, and for some cast members this is true.

As some have said wages are not keeping up with inflation so what is the answer. If inflation goes up so should wages go up also? With that kind of thinking if inflation goes down should wages also go down?

There is no right answer.

 

[Douglas Dubh]

Disney has pretty good medical, dental, and eye benefits. They also offer discounts on Disney vacations, access to theme and water parks, merchandise and food discounts, and previews to new attractions to cast members. And of course the Aspire program. There’s lots of cast members for whom Disney is a second career, working for pocket money or for medical insurance because they were able to retire in the 50’s and just need something until they turn 65 and can get Medicare. They aren’t looking for a living wage.

 

[tatkins]

Everyone keeps talking about minimum wage being too low. I worked for minimum wage in high school. My nieces and nephews make $3.00+ per hour above minimum wage in high school at fast food restaurants and grocery stores. At least in my area you’d be hard pressed to find a job only paying minimum wage. However, I must say that I am in the camp of telling people where the line starts and “may I take your order please” has never been intended to provide for a family. You are supposed to move up in society as an adult not expect society to take care of you.

 

[Mikey15]

Disney has pretty good medical, dental, and eye benefits. They also offer discounts on Disney vacations, access to theme and water parks, merchandise and food discounts, and previews to new attractions to cast members. And of course the Aspire program. There’s lots of cast members for whom Disney is a second career, working for pocket money or for medical insurance because they were able to retire in the 50’s and just need something until they turn 65 and can get Medicare. They aren’t looking for a living wage.

The "retirement job" side of things plus the "college job" side of things are the big contributors to the market forces that allow Disney to fill frontline staffing positions at relatively low wages.

Still, I believe the adjective for paying people less than a living wage because the market says you can, or because they still accept it, is "exploitative."

 

[DLgal]

I am glad we can have a health, civil discussion about this topic.

There are some that believe that everyone, regardless of their skill level, should make what they think is a living wage no mater where or who they work for or what they do.

There are those that think that wages should be tied to a certain skill level, kind of job done and where they live.

There has to be a middle point and a good part as to why you can't have that nationally is because it cost different amounts of money to live in different parts of not only the country but even different parts of a state.

I think Disney pays a good starting wage for the jobs listed and if cast members stay long enough they can top out at a good pay rate.
Disney offers great opportunity for transfers to higher paying jobs.
Disney also offers cast the opportunity for paid education so they can better themselves and look for better paying jobs within the company.

Some think Disney does not pay enough for cast members to live in central Florida, and for some cast members this is true.

As some have said wages are not keeping up with inflation so what is the answer. If inflation goes up so should wages go up also? With that kind of thinking if inflation goes down should wages also go down?

There is no right answer.

Yes, wages should increase along with inflation. Or, rather, as a function of the annual CPI. It's called COLA. It's an idea that as the cost of living increase, so should your income.

COLA is applied to Social Security, SSDI, SSI, VA Disability, and Military Retirement Pension payments. For next year, this amount is 8.7%. All those people receiving those types of income get inflation protection. Why shouldn't workers?

I would support legislation that forces companies with, let's say, at least 100 employees to match the CPI with pay raises across the board. In addition, the Federal Minumim wage should be immediately adjusted upwards from its last raise in 2009 to account for inflation since that point in time.

In years where there is no or negative inflation, keep things flat. No raise. Deflation isn't a common occurrence, only happening twice in the last 60 years (and both times very close to 0%, being very slightly below that).

 

[CamillaF]

Can some one please tell me what a living wage is. It is like affordable housing, what is the dollar amount?

https://livingwage.mit.edu/

 

[CamillaF]

https://livingwage.mit.edu/

The amount is different in each state/city. It’s basically enough to live in a normal house/apt, eat, get to work and have basic health care. Their is a little left over for misc stuff but it’s not a fun life. I run a company and pay all of my staff based on a living wage. Disney should do it and let Wall Street sue them.

 

[71 Truck]

https://livingwage.mit.edu/

Thank you this is some very good information and answers the question I have been asking. It give hard date with out personal emotion involved.

So taking into account the following county's that as far as I understand where most cast members live.
This would be the information as to what a minimum living wage would be for a single person with no children.
Orange $18.19 an hour
Lake $18.19 an hour
Polk $16.30 an hour
Osceola $18.19 an hour

With that information, a single person with no kids making what Disney starts new cast members at,($15.00 Dollars an hour is the lowest starting pay, there are jobs that start higher) to come close to that they would have to live in Polk County.
For that cast member living in Polk county, to surpass that number they would have to have at least three years or more with the company or have moved to a better paying job.
For cast members living in the other three county's they would have to be close to the top pay for that job I used as an example. As of this contract that would be $19.37 an hour.
The job I am using as an example would be for an Attractions host. Pay scale would be $15.00 minimum to $19.37 maximum.

I have heard the union covering most cast members is looking to up the starting wage to I think around $18.00 an hour.



By the way anyone looking at what the cast pay contract says for the many jobs this one union covers, search for the following,
This would be local 362, then under the Walt Disney World Bar, click WDW Full Time then scroll down and look for the 2017 Walt Disney Worlds Full Time Contract.
I would post a link but I am not sure if I an aloud to.

 

[CamillaF]

Thank you this is some very good information and answers the question I have been asking. It give hard date with out personal emotion involved.

So taking into account the following county's that as far as I understand where most cast members live.
This would be the information as to what a minimum living wage would be for a single person with no children.
Orange $18.19 an hour
Lake $18.19 an hour
Polk $16.30 an hour
Osceola $18.19 an hour

With that information, a single person with no kids making what Disney starts new cast members at,($15.00 Dollars an hour is the lowest starting pay, there are jobs that start higher) to come close to that they would have to live in Polk County.
For that cast member living in Polk county, to surpass that number they would have to have at least three years or more with the company or have moved to a better paying job.
For cast members living in the other three county's they would have to be close to the top pay for that job I used as an example. As of this contract that would be $19.37 an hour.
The job I am using as an example would be for an Attractions host. Pay scale would be $15.00 minimum to $19.37 maximum.

I have heard the union covering most cast members is looking to up the starting wage to I think around $18.00 an hour.



By the way anyone looking at what the cast pay contract says for the many jobs this one union covers, search for the following,
This would be local 362, then under the Walt Disney World Bar, click WDW Full Time then scroll down and look for the 2017 Walt Disney Worlds Full Time Contract.
I would post a link but I am not sure if I an aloud to.

As someone who has been following this for years it was shocking when the Living Wage jumped $3 an hour (we are in the Seattle area) in 8 months. it was $17.05 last October jumped to $20.05 in June and when I looked in October it lowered to $19.97. I assume that a similar jump happened in Florida this summer. It's hard to keep up and shocking at how volatile it is right now. It usually only goes up by around CPI. However that is what the employees are feeling on the ground and you can't argue with them that it's hard to buy food when the cost are raising so much.

 

[RamblingMad]

Disney can raise their prices faster than inflation, so they should be able to pay more.