The answer to $15.00 Hour fast food restaurant wages

Seattle has been in growth mode for quite some time. Lots of tech & skilled labor jobs.

And yes, it does stand to reason that an influx of $ would help the economy, but where will that money originate? So, now it becomes a catch-22.

Nobody can afford to eat in my restaurant because wages are so low.

I can't afford to pay my staff better because my business is so slow.

Without some new source of revenue, major wage increases for the bottom will just result in higher unemployment.

But the thing is, a higher minimum wage is in large part a new source of revenue for communities. Everyone focuses on small businesses, but the net effect of a minimum wage increase is new dollars flowing into the community from the national corporations that represent the largest part of the retail and food service sector in most localities. A mom & pop diner paying more may just be shuffling dollars from one place in the community but Walmart, McDonalds, and Dollar General paying more absolutely is adding new money to working class communities that never would have landed there as spending/investment.

But Colleen, (and out of the utmost respect from a fellow Michigan girl):

I know Detroit very well having lived most of my first 35 years there and all my family lives in the area (my father still lives in the city limits in the house I grew up in) and I know that even at $15.00/hr, there is still going to be very little disposable income left at the month for a family of 4. They will basically be replacing their food stamp, medicaid, and SNAP benefits with the increase in pay, leaving them no better or worse off than before. (the taxpayers might be a little better off, but that is a different topic in this debate so I won't get into that on this post).

Except with the way those programs are structured now, with a gentle phase-down rather than hard cutoffs, the idea that recipients "can't" make more for fear of losing benefits is largely a myth. What is lost is less than what is gained, on a dollar-by-dollar basis, except in very specific circumstances.

And you're right about downtown thriving because the suburbanites aren't afraid to go there any more. That's definitely part of the story, and IMO, a part that supports the case for demanding a higher minimum. Suburbanites spending is driving more jobs and higher pay for Detroiters. Why wouldn't the influx of money that corporations are, at this point, unwilling to pass along to workers have the same effect?

All of the arguments against a higher minimum wage sound to me almost worshipful towards "the job creators" and Wall Street as existing beyond the reach of the social contract that built this country. We're told workers shouldn't expect to see higher wages even in times of record high profits, that they should quietly accept abuses like mandatory off-the-clock work duties, widespread abuses of overtime rules, constant insecurity in terms of hours, absolutely no respect for family, society, or the environment, etc. At the same time, we're told our communities should be ponying up tax dollars to compete for those low-wage, low-quality jobs, essentially getting hit from both sides. And when the little guys try to organize to stand up to these things, they're slapped down as undeserving of a better wage, entitled, lazy, incompetent, and generally sub-human. It goes against some unspoken American gospel to suggest that the benefits of capitalism should be shared across the wage scale (not equally - which is always the ridiculous counter to that point - but still shared), that if declining profits or productivity are reason to cut wages, increasing profits and productivity should be reason to increase them, and that economic prosperity needs a broader definition than the Dow hitting 18,000.
 
But the thing is, a higher minimum wage is in large part a new source of revenue for communities. Everyone focuses on small businesses, but the net effect of a minimum wage increase is new dollars flowing into the community from the national corporations that represent the largest part of the retail and food service sector in most localities. A mom & pop diner paying more may just be shuffling dollars from one place in the community but Walmart, McDonalds, and Dollar General paying more absolutely is adding new money to working class communities that never would have landed there as spending/investment.



Except with the way those programs are structured now, with a gentle phase-down rather than hard cutoffs, the idea that recipients "can't" make more for fear of losing benefits is largely a myth. What is lost is less than what is gained, on a dollar-by-dollar basis, except in very specific circumstances.

And you're right about downtown thriving because the suburbanites aren't afraid to go there any more. That's definitely part of the story, and IMO, a part that supports the case for demanding a higher minimum. Suburbanites spending is driving more jobs and higher pay for Detroiters. Why wouldn't the influx of money that corporations are, at this point, unwilling to pass along to workers have the same effect?

All of the arguments against a higher minimum wage sound to me almost worshipful towards "the job creators" and Wall Street as existing beyond the reach of the social contract that built this country. We're told workers shouldn't expect to see higher wages even in times of record high profits, that they should quietly accept abuses like mandatory off-the-clock work duties, widespread abuses of overtime rules, constant insecurity in terms of hours, absolutely no respect for family, society, or the environment, etc. At the same time, we're told our communities should be ponying up tax dollars to compete for those low-wage, low-quality jobs, essentially getting hit from both sides. And when the little guys try to organize to stand up to these things, they're slapped down as undeserving of a better wage, entitled, lazy, incompetent, and generally sub-human. It goes against some unspoken American gospel to suggest that the benefits of capitalism should be shared across the wage scale (not equally - which is always the ridiculous counter to that point - but still shared), that if declining profits or productivity are reason to cut wages, increasing profits and productivity should be reason to increase them, and that economic prosperity needs a broader definition than the Dow hitting 18,000.


McDonalds is a franchise operation. The stores are owned by "mom & pop" types for the most part. I went to HS with the owner of our local store.
 
Why stop at $15? Serious question, why not mandate a minimum $100 per hour? All of the arguments for $15 per hour are so good, I just don't understand why we would stop at $15.
 
But the thing is, a higher minimum wage is in large part a new source of revenue for communities. Everyone focuses on small businesses, but the net effect of a minimum wage increase is new dollars flowing into the community from the national corporations that represent the largest part of the retail and food service sector in most localities. A mom & pop diner paying more may just be shuffling dollars from one place in the community but Walmart, McDonalds, and Dollar General paying more absolutely is adding new money to working class communities that never would have landed there as spending/investment.



Except with the way those programs are structured now, with a gentle phase-down rather than hard cutoffs, the idea that recipients "can't" make more for fear of losing benefits is largely a myth. What is lost is less than what is gained, on a dollar-by-dollar basis, except in very specific circumstances.

True, on the loss vs what is gained part, but still, the gains are not going to be large *enough* to give a single mother (or father) a discretionary spending budget once all of their bills are paid, and medical costs are taken care of. Case in point - DH and I together make in the low 6-figures (and now live in the Chicago suburbs where cost of living strongly lands us in the lower half of middle class) and our budget is really taking a hit with our $10,000/year in healthcare premiums + copays and deductables with DS15's recent surgery. Even at an adjusted income of about $60K (I'm estimating here) as a comparable income in Detroit, and double what a $15/hr min wage is, these workers are still barely making ends meet. They are not putting a whole lot of extra cashflow into the economy at the end of the month.

And you're right about downtown thriving because the suburbanites aren't afraid to go there any more. That's definitely part of the story, and IMO, a part that supports the case for demanding a higher minimum. Suburbanites spending is driving more jobs and higher pay for Detroiters. Why wouldn't the influx of money that corporations are, at this point, unwilling to pass along to workers have the same effect?

It could, but every employer would have to be on board, and what incentive does an employer who is paying their college-graduate workers $50K a year have in giving them a raise if min wage goes to $15? In their eyes, they are already paying a fair wage, much higher than the current min wage, and still higher than $15.00, so why would they need to give their employees a raise for doing the same job if min wage goes to $15? But if prices go up because min wage goes up (which I think all of us agree WILL happen whether we idealize the situation or not) the worker making $50K now has a much lower level of buying power with their discretionary spending budget. And with a lower surplus at the end of the month, they will spend less on wants, pay more for needs, and it all evens out again. And now that the $550 apt now costs $800 for the FF worker, it won't take long before they feel the effects of inflation, too, which ultimately just lands them back at square one.

All of the arguments against a higher minimum wage sound to me almost worshipful towards "the job creators" and Wall Street as existing beyond the reach of the social contract that built this country. We're told workers shouldn't expect to see higher wages even in times of record high profits, that they should quietly accept abuses like mandatory off-the-clock work duties, widespread abuses of overtime rules, constant insecurity in terms of hours, absolutely no respect for family, society, or the environment, etc. At the same time, we're told our communities should be ponying up tax dollars to compete for those low-wage, low-quality jobs, essentially getting hit from both sides. And when the little guys try to organize to stand up to these things, they're slapped down as undeserving of a better wage, entitled, lazy, incompetent, and generally sub-human. It goes against some unspoken American gospel to suggest that the benefits of capitalism should be shared across the wage scale (not equally - which is always the ridiculous counter to that point - but still shared), that if declining profits or productivity are reason to cut wages, increasing profits and productivity should be reason to increase them, and that economic prosperity needs a broader definition than the Dow hitting 18,000.

I have absolutely NO worshipping factor towards toward job creators and Wall Street, and with a HR background (although not in that field currently), I am always conscious of workers rights and labor laws. I am, however, also a staunch supporter of the middle class and want to see them protected. Personally, I have worked too hard for too long to get a foothold where I am, and it does seem threatening that my middle-class income that I have earned through much hard work, sacrifice and a lot of student loans will be compromised because people who didn't work as hard as I did and go into debt to do it want more money for the same job. It's eventually all going to even out in the end as inflation and the economy adjusts, but in the meantime, all this will do is hurt the middle class. The way the economy works is that there will ALWAYS be a top tier, and a bottom tier. We can pay the bottom tier as much as we want, but they will always be the bottom - the economy will make sure of that. Do we really want to hurt the middle class *that* much that we are willing to put them through this so that FF workers can spend the next 5-10 years in a $800 1-bedroom apartment?

And that is my right-wing soapbox rant! The Republican side coming out in my normal Independent Party self. The Liberal side says that we need to fix big business and the education system so that more of the profits actually flows to the employees so that they have the OPTION (not the RIGHT) to earn a better wage, so I completely agree with you on that.
 

The way the economy works is that there will ALWAYS be a top tier, and a bottom tier. We can pay the bottom tier as much as we want, but they will always be the bottom - the economy will make sure of that. Do we really want to hurt the middle class *that* much that we are willing to put them through this so that FF workers can spend the next 5-10 years in a $800 1-bedroom apartment?

Of course there will always be a bottom. There has always been a bottom. But from the Great Depression to the mid-70s, pay at the bottom tracked pretty closely with inflation and while the bottom was still the bottom, their wages and standard of living kept pace with inflation and other changes over time. Since the mid 70s, the inflation-adjusted income at the bottom has fallen. The middle has stagnated (because if the bottom is only making $8, employers can pay skilled workers $12 or $15; if the bottom is making the $11 that the minimum would be if it had tracked with inflation, how many people are really going to get a 2 year degree or professional certifications for an extra $1/hr?). And the top has soared. IIRC, the wage growth figures since 1980 are -5% (10th percentile), 5% (50th percentile), and 45% (90th percentile) respectively.

The middle class is hurting now. We need to do *something* to jump-start wage growth or there won't BE a middle class much longer. And there aren't many policy levers to pull on that issue other than raising the floor and counting on a ripple effect upward.
 
Except with the way those programs are structured now, with a gentle phase-down rather than hard cutoffs, the idea that recipients "can't" make more for fear of losing benefits is largely a myth. What is lost is less than what is gained, on a dollar-by-dollar basis, except in very specific circumstances.

I'm going to disagree with this, honestly. While it's probably the way it's supposed to work, I don't think it does most of the time.

Particularly in the insurance area. There's no phase down. You either qualify or you don't. Once you lose it, you also have to start paying OOP for your own insurance so there's no gain here for the worker that's offsetting the loss - and it's a huge loss.
 
I'm going to disagree with this, honestly. While it's probably the way it's supposed to work, I don't think it does most of the time.

Particularly in the insurance area. There's no phase down. You either qualify or you don't. Once you lose it, you also have to start paying OOP for your own insurance so there's no gain here for the worker that's offsetting the loss - and it's a huge loss.

The ACA established a fairly gradual phase down. Assuming we're talking about a state that expanded medicaid, because Michigan did so that's what I'm familiar with... People get to the cutoff for medicaid (133% FPL) and then have the option of transitioning to a heavily subsidized marketplace plan. And there's the new affordability test in place for employer plans, so having access to an employer plan isn't automatic disqualification from state plans if the employee share of the premium is too high. It isn't perfect, but it is big improvement over the days when making $10 too much meant you were on your own for 10K health insurance premiums.
 
The ACA established a fairly gradual phase down. Assuming we're talking about a state that expanded medicaid, because Michigan did so that's what I'm familiar with... People get to the cutoff for medicaid (133% FPL) and then have the option of transitioning to a heavily subsidized marketplace plan. And there's the new affordability test in place for employer plans, so having access to an employer plan isn't automatic disqualification from state plans if the employee share of the premium is too high. It isn't perfect, but it is big improvement over the days when making $10 too much meant you were on your own for 10K health insurance premiums.

I can't speak from experience, but from what my friend dealt with insurance was pretty all or nothing. When she made just over the qualifying amount she had to get her own. It was at a lower cost through the Affordable Care stuff, but was still more than she brought up her income that had disqualified her from free care.

Her employer didn't offer insurance, or it was outrageously high compared to her income. Shouldn't be that hard to do. Ours through the hospital is $500 for a family or so. If the techs make $12/hr that's not a lot of money brought home afterwards.
 
but I don't think Seattle had such a strong economy before the wage hike that wage inflation was happening naturally.

The economy has been booming here for years. The recession never hit Seattle as much as other parts of the country. The reason the $15 / hour got traction out here is because of labor issues at Alaska Airlines. Their baggage handlers were negotiating for better pay and threatening to strike. Instead of giving in to their demands Alaska fired them all and contracted out all baggage handling. It really pissed off the unions here and they pushed the city council to pass a $15 hour minimum wage law.
 
Do i agree 100% with a $15/hr minimum wage, maybe not. But I think if you are working full time, no matter the job you should be able to support yourself with assistance. Especially when the CEO's for these corporations are pulling in salaries and benefits that equal more than some 3rd world countries make.
Don't assume all fast food workers are lazy and have no ambition. I am just as outraged at the CEO's cutting jobs and benefits, and taking a huge raise for themselves as I am the people that milk the benefits system,
 












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