Written By: - Date published: 7:06 am, May 24th, 2011 - 295 comments
Categories: minimum wage -
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I just love seeing fat, rich men who have received massive tax cuts paid for with borrowed money like John Key and Phil O’Reilly saying that a $15 an hour minimum wage is unaffordable (Key also says governments can’t raise wages, yet he claims to have done just that). Lets check out one large minimum wage employer’s ability to pay.
Restaurant Brands owns 208 KFC, Pizza Hut, and Starbucks stores, employing 4,500 workers, most of them minimum wage.
For simplicity’s sake and to estimate on the high side, lets say they all do 40 hours a week and all would get the $2 an hour raise. That comes in at $1,900,000 a year. Since wages are tax deductible, the cost to Restaurant Brands would be $1,300,000
Restaurant Brands made $25.1 million after tax profit in the year to March, up from $19.9 million the previous year. So, an extra $1,300,000 would reduce its profits by 5% while boosting its employees’ pay by 15% and having a dramatic impact on their families’ living standards.
This is not a poor country. We have a GDP of $200 billion per year, $50,000 for each man, woman, and child. An extra $500 million for the lowest paid workers who are often in the crappiest jobs is nothing. Except to the elitists who are hogging all the wealth for themselves and don’t want to share.
[update - curse of the late night typo. The gross cost would be $19m, not $1.9m, meaning net cost of $13m. 50% of profits. Still completely affordable. Remember that's on my high assumption that everyone is full-time on the minimum wage, real cost would be much less]
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Scoopit!
Good answer. It is SO nice to debate with someone like you.
I am not sure it replicates the US system of unemployment insurance. For example, I think NY state law requires you to pay it back…? I am not suggesting that.
Let’s say 12 months as a starting point. I am saying that an able-bodied person who is unemployed for a year should undertake some work for the state. Maybe a day a week.
In Androplis [ahem] the state will provide a back-up for work. So, let’s say we might ask you to turn up on a beach or mountain one day a week and help clean up trash. Or visit a rest home two afternoons a week. (I know of one where 90% of residents – I kid you not – get NO visitors.)
You have a range of options, and we ask you to do one day a week.
I am NOT suggesting a unilateral cut-off of benefits if you have been unemployed for a year. I am suggesting a community-based work-force of one day a week. And if you fail to attend three times in six months for a legitimate reason, then the state will not support you.
(I am not talking about superannuation, war pensions, sickness or invalid beneficiaries or war widows.)
Why should we steal money from people who choose to work to give to thieves? *provocative*
I’d prefer a higher level of support was available for those who deserved it. As a society we just need to decide who deserves it.
A-ha…now that you’re talking about direct employment by the state, I know that you are serious.
There is so much work left undone, so many people left uncared for in our society. And, we have a large number of unemployed people who would be interested in that kind of paid work. It might be full time or it might be a day a week.
But in our current capitalist system – we have capital, we have labour, we have the need, but the capitalist system cannot seem to get those elements together so that we can help build people up and build communities up.
This harks back to the poor house system of the 19th century. Not sure why that would be necessary when we have an economy in which the top 8%-9% of people are so freakin rich that they have more wealth than everyone else put together.
Going back there is not really forward progress IMO.
Society can decide for instance that no worker should earn more than 20x another worker. And any economic surplus above and beyond that can be put back into the common good of the community.
Just some great ideas… but a warm bed beckons.
More tomorrow. ‘Night.
The latter point would be alleviated through direct employment by the state. That is, those who deserved it would be those doing more worthwhile work (as decided by us, not the capitalist system).
Does anyone know where I an find stats on total number of people on the min wage, total hours worked per week, and totals by age, gender, ethnicity? Plus split between public and private sectors?
Most is on http://www.statistics.govt.nz. If you can’t find what you need (and I admit it’s not the cleanest of sites) ask me tomorrow.
You either haven’t been paying attention or you are just not willing to consider the full picture.
In 2010, 56% of workers on minimum wage were part-time workers (Minimum Wage Review 2010 p. 17)
Further, you’re not taking into consideration the fact that the inelasticity of the low wage service industry means that most of the extra cost will likely be spread amongst all consumers.
Those companies should be allowed to fail and make way for more competitive and more productive enterprises with better business models.
That’s the way the free market works.
We’re not here to help keep lame businesses in the black.
I didn’t exactly follow the “math” but the figure of $15 seems about right compared with the cost of living.
Deborah Kean aka Vicky
Thank you for your apology.
Still feeling quite shell-shocked… I think we have started off on the wrong foot.
I hope in the future I can get my point across with more compassion and we can have some constructive conversations.
I genuinely believe we are much closer in views than it seems at first glance.
Pax?
Don’t get too worried about it, you will probably see worse… See the policy to get an idea about what the moderators will look at. But robust differences of opinion are not really on our list unless they drop into flamewars.
We like to get differences aired and people evading in politeness just encourages our resident bastards (like me) to prod until we evince what people really think…
Thanks. Not sure I *want* to see worse, but hey.
At least no-one called me a frakking toaster lover. [BSG joke]
I tend to be somewhat more direct than Vicky and after 30 years around the various nets quite abrupt when dealing with fools who I have dealt with several times before.
Personally I rather like it when people are better than moderation level (where my alter ego sysop deals with them) but manage to annoy me. Painfully twisting the hatpin with a mixture of fact, opinion, and personal barbs frequently winds up as a educational experience – even though the recipient doesn’t like it at the time. It will teach them how to survive the nets over the long term…
Fair enough.
Mate, we’re all toasters at one level or another.
By your command…
We never finished that conversation about working for the dole. (Oh, I’m just the Devil, aren’t I?)
Happy to continue if you are free and have the inclination, otherwise no worries at all.
Pax! (I love my toaster, although don’t make the mistake of cooking those hash brown things in them) ..
I am so delighted. Thank you. Hash browns are excellent but the oven is clearly called for.