Labor Markets and Minimum Wage: Crash Course Economics #28
Вставка
- Опубліковано 27 чер 2024
- How much should you get paid for your job? Well, that depends on a lot of factors. Your skill set, the demand for the skills you have, and what other people are getting paid around you all factor in. In a lot of ways, labor markets work on supply and demand, just like many of the markets we talk about in Crash Course Econ. But, again, there aren't a lot of pure, true markets in the world. There are all kinds of oddities and regulations that change the way labor markets work. One common (and kind of controversial one) is the minimum wage. The minimum wage has potential upsides and downsides, and we'll take a look at the various arguments for an against it.
Crash Course is on Patreon! You can support us directly by signing up at / crashcourse
Thanks to the following Patrons for their generous monthly contributions that help keep Crash Course free for everyone forever:
Mark, Eric Kitchen, Jessica Wode, Jeffrey Thompson, Steve Marshall, Moritz Schmidt, Robert Kunz, Tim Curwick, Jason A Saslow, SR Foxley, Elliot Beter, Jacob Ash, Christian, Jan Schmid, Jirat, Christy Huddleston, Daniel Baulig, Chris Peters, Anna-Ester Volozh, Ian Dundore, Caleb Weeks
--
Want to find Crash Course elsewhere on the internet?
Facebook - / youtubecrashcourse
Twitter - / thecrashcourse
Tumblr - / thecrashcourse
Support Crash Course on Patreon: / crashcourse
CC Kids: / crashcoursekids
One thing that's important to note about wage discrimination is that it happens primarily when people are working under imperfect information. In other words, when everyone knows what everyone else is making it's harder for companies to pay people unfairly.
unfortunately companies will fight against making wages transparent, as that will drive up bargaining for more pay.
if they were more transparent, more people would be motivated to sue their employer using the '63 equal pay act, and thats also not wanted by employers
Yup, more liquid pay markets are inherently bad for employers, because with less information a boss can bluff about how little they're able to pay other people.
+Markus Leben wage discrimination? haha. is the term you use for the wages of unskilled laborers? stop feeling sorry for yourself and learn a fucking skill
+MrBipBipp I guess it does open up the opportunity for price signaling like you see between stores selling the same good and trying to avoid Prisoner's Dilemmaing themselves.
Honest impression: This is the best crash course I have seen. This is also the best explanation I have received about the labour market, even during my three years of studying economics in high school. Hence, a toast to you guys, and also a big THANKS!
A quick note for Crash Course editors : Could you avoid using the visual effect used at 2:57 and 8:07? This Flashing Screen effect is really painful on my eyes. I'm not prone to epileptic seizures or anything, but it's still incredibly annoying.
Thanks for the video.
Seconded
yes! seriously what was up with that?
+LiwenDiamond I thought my screen was messed up!
+LiwenDiamond thanks for the heads up... ill be skipping ahead now =D
last thing i need is a migraine or seizure.
*****
thanks, as it is i am still an undergrad... however i still skipped the video as it quite unpleasant for me.
I'm a college student and I just want to thank Crash Course! You are such a HUGE help in just about every subject! Thank you so much for making such great quality videos with so much good information!
I realized I never said: thanks for the wonderful job everybody does on Crash Course.
DFTKeepBA
ACDC
Such a Dad belt haahahahah
2:58 Love CC, but please stop these flickering borders. They're distracting and could induce headaches/seizures.
Simply making a greater percentage of the workforce more skilled isn't a substitution for a minimum wage. There will always be a need for at least some unskilled labor.
shouldn't the minimum wage be scaled with inflation?
Yes...
+fiery shendu yes, and it should be a living wage, but the corporations don't want it as it means they'll have to pay a lot of low level employees a fair wage
If minimum wage works make it $50 a hour.....
+dluff
Are you saying that minimum wages don't work in principle because a 50 dollar minimum wage is ridiculous?
Because if you are, you are engaging in a form of the continuum fallacy.
+dluff
And if you are (and I hope you're not, I don't know), here are some other fallacious arguments that use the same form of argumentation.
If owning 10 pairs of jeans really works, why don't you just buy 200?
If lightly tapping someone on the shoulder is legal, why isn't punching them as hard as you can legal?
If you really think 10 mg of oxycodone helps reduce the pain of your surgery, why don't you just take 100 mg?
2:57 starts glitching - epilepsy warning
+szgergo99 Yeah, what was up with that? Simulating welding or something?
+szgergo99 All their videos have this problem when they're using that filter on the borders. It's annoying.
I never noticed until i saw this comment
They forgot to mention that higher minimumwages also result in higher prices for goods made by minimumwage workers.
Citation needed
+John Dough Which questions the idea that increasing the minimum wage would increase consumer spending.
+John Dough Yea, you are right, but the price increase in goods is significantly less then the increase in wages. The min wage workers still end up with more buying power.
+John Dough More importantly, she forgot to mention that the higher wages lead to higher prices in goods with less elastic supply. It particularly leads to increasing land rents in an area, which can make it particularly hard for the poor to keep living there. In fact, some studies which seem to show minimum wages being good for employment rates actually demonstrate that it can gentrify an area by pushing its poorer residents into lower rent areas. Those who stay may be better off, but that is more than balanced by the increased hardships of those who have to move away.
+John Dough What a lot of people seem to forget is that shareholders are the issue. It's quite possible to make reasonable quality products (in most cases), while paying decent wages at every stage, and keep the prices affordable, but that would require shareholders to miss out on some rather large profits. Higher wages only means higher prices for goods IF shareholders are unwilling to earn less, and that is usually not the case.
10:03 Messi took that advice seriously 😂😂
I appreciate the note how minimum wage effects possible unemployment and seeking more skilled workers, though there was no discussion of how minimum wage might affect product prices within that establishment and influence the cost of living for everyone, employed and unemployed. Could you discuss how minimum wage effects those factors?
Could you do an episode about Universal Basic income and how automation may affect our economy in the future?
+RainAngel111 It would be pretty speculative.
+Robert Richter along the lines of, the rich get richer and the poor die down an alleyway. :o
That's one plausible future, but by no means the only one. As I said, highly speculative.
Robert Richter Yeah, but I just thought it fit well with your surname. ;)
Ah, it's pronounced more like "Rik-ter," but I can see that.
Awesome, guys! Hope you will continue make the episodes!
I found this a good and fairly unbiased look at the situation in layman's terms. (I do see some previous commenters thought it extremely biased) Thank you.
I am not going to tell you what to believe, but this is what you should believe.
+ragmondead yeah you can believe in Green little mushrooms running the universe and conspiring to end humanity for all I care, but what you should believe is in the apparent, in the random nature of the universe
+Ali80076 the universe is random, but society and people are not, though we try to make it seem that way
They presented data and economists opinions. If you disagree with them due to contrary reasoning or evidence, you are free to do so. However, evidence was presented, and they impose a firm conclusion. They're allowed to present what they believe is valid and relevant information to the topic at hand.
Economics isn't a belief system. Although I suppose you could argue there are various economic theories
Naturea Bioros they don’t give any evidence, at all, rewatch the video, the sole justification for the minimum wage they give is the logical fallacy of appealing to authority, by just pointing at “look all these smart people that think this”, the other argument they presented was also based on a logical fallacy, correlation doesn’t imply causation. They took two states with a huge multitude of factors influencing their Labor market and economy, and insinuated that the minimum wage was the determining factor, without providing any proof whatsoever.
lol, on 8:53 you can see the burger king reflection
Could you do a video on basic income or negative income tax?
At 0:11 , that's the kind of work I do. Working on the poles for the phone company, but these days we are putting up fiber cables and fiber service drops to the home. Not often we use butsets anymore.
Spent 6 months looking for work as a barista, so instead, I got a load from a family member to get a Medium Ridged heavy vehicle license. Got a job that same week. Thinking about the labour market as a market is very, very helpful, I am glad I made the switch in mindset, now to get that raise... Maybe next week...
When I was out of college looking for a job in engineering, I worked at a small computer repair business for $9/hr for a while. There were three people who worked there, and they hired me to take some of the load off. If the minimum wage were much higher than that, I think they would've just sucked it up and worked harder.
I'm not saying this is a super common situation, just that these situations definitely exist.
Can you do a video on mondragon cooperatives?
Awesome video, great labor market background for a ten minute video
Guys, I have to tell you, I absolutely love this series! I think CrashCourse Economics is the most useful series on this channel, and I'm glad you took your time to go into details and stretch it to many episodes, and I hope you're planning on many more :)
Good message: learn new skills!
My lesson for today was to orient myself toward developing skills that would benefit both myself and businesses I'd like to hopefully get to invest my time into.
Luv ur team wrk... perfectly synchronized... tq
Nice AC/DC belt, Jacob! 9:36
raising the minimum wage slightly as well as making it mandatory for businesses to allow tipping could drastically help out with our working poor in this country, i work slightly above minimum wage but i also receive tips, these tips can some times effectively double my wages when people are generous. It also incentivizes people to work hard and be kind and positive, while giving people who are well off an opportunity to give to people who are actually working rather than people who want to abuse government subsidy and not work
MR.Chickennuget 360 I know all the baggers I work with would love to be able to receive tips. Just cause a lot of them are kids doesn’t mean they can’t use extra money.
Nice belt buddy !
& Of course a good video ;)
Thanks, sir & mam, for your nice description on this topic
Do a video on basic income
I think a minimum wage wasn't put in place to be a living wage, but rather to prevent employers from exploiting people. Also I think that having unions decide the minimum wage via collective bargaining is a more free market answer
Sparsh Agrawal MW was intended to be livable at it's passing.
I don't like it because it gives companies a bottom line to pay employees rather than actually paying then their true economic worth which could potentially be more than minimum.
Sparsh Agrawal also, I really dislike the idea of a federally mandated wage because there is not a 1 size fits all solution to all problems.
it should be addressed state by state or even better, city by city.
same with firearms laws and the like.
I have no clue why our government just insists on making broad sweeping legislation to deal with relatively localised issues.
Yes because Unions only, and only should have one goal. To promote a better wages among the people of that said union. The Union shouldn't lobby "how many can teach", or make rules that benefit the longer the people who joined the unions (FI-LO, First In last out, that is, people who taught the longest will stay the longest no matter how "good or bad" they are just because they are the longest). Unions was founded to negotiate WAGES and to improve workplaces. That's it.
Great content, ai will reduce low skilled or semiskilled labour force needings. Every aspect of our economy understanding and estimates have to change in order to catch up with the pace of the current world
I honestly love these two.
"I'm not going to tell you what to think, BUT--", followed by over 3 minutes of fairly biased arguments. Everything before this point seemed fairly unbiased though, and I did enjoy the first part of the video.
+Wes Wells lol, exactly. The Karl Marx statue should have given it away.
There's some serious strobing going on from 2:58-3:04 and again 8:06-8:20.
Ya'll should really fix that now y'hear?
Great video, although this could really do with graphical representation to better present the impact of Monopsony and Monopoly on wage level and employment in a market.
Hey, could you make a video about unemployement and the different kinds? Thanks :) I LOVE Crash Course by the way, it is the best
Of course the Chicago School would be against higher minimum wages
What's with the flickering vignette at 3:00? I almost thought something was wrong with my monitor lol
I love the narrative of I am not going to tell you how to think, but here is what I think and the only situations where it might not have a net negative impact. I do appreciate the attempt at balance offered by crashcourse though different lenses in the social sciences as they at least give the arguments. I guess perfection is just the enemy of good.
Awesome content!!
“A State divided into a small number of rich and a large number of poor will always develop a government manipulated by the rich to protect the amenities represented by their property.”
-Harold Laski, British political theorist (1893-1950)
Why I don't understand left wing philosophy. You say things like this and you go vote for more government.
Beans Haha wtf are you even trying to say?
The right and left aren't parties. The political spectrum best describes size of government.
The right minimum wage is 0.00$
+Vital Mark
Simple, he goes to another employer who is willing to pay him higher than you will.
Early for once, exciting!
good discussion. it's a complicated issue that needs to be considered carefully
so in other words dont work minimum wage got it
Good, now tell that to the rest of your friends and their friends. If fewer of you work minimum wage job, that means i can make more money from minimum wage than most skill workers.
8:52 whats the point of the blur, if its still clearly readable in the reflection of the window :P? Nice episode though.
+Twan de Graaf i have no idea what fast food chain that is. not from usa tho
+Zachary Levy I'm a 'murican I can help! www.bk.com/
It happened--In another country we all came from elsewhere. A friend was a marine carpenter who would not work for less than $25 an hour, the locals worked for $3 per hour. After trying again and again the $3 workers they tried to get his services offering more and more. He refused, one job at a time for $25 an hour.
I like listening to Milton Freeman and Thomas Sowell about economics
Gathers cookies, prepares to watch political flame wars unfold.
I don't get it.
Looks real professional with the ACDC belt buckle...
That belt buckle is fucking amazing!!!!
I like how objective you've become.
They're extremely subjective.
They're extremely subjective.
You should see their older videos.
+Levi “When will we want wantons” Quickburger5000 He's being sarcastic I'm sure. This video was like 90% bias.
You didn't even mention how the impact of a higher minimum wage can trigger a demand inflation.
Yes, it will stimulate the economy but that will eventually lead to inflation which would make things just as they were before.
Yeah while it will increase the velocity of money, it may also cause inflation. Capitalism is a pretty silly system to deal with.
I enjoy Crash Course because you inform and give a fair and balance perspective .... you have me respect
+Raphael Dean Yeah. I don't particularly object to this, but lines like "I'm not going to tell you what to think, but think about it this way ... " make me cringe.
+Raphael Dean my point is the did not make a conclusion they just give the information but what makes it balanced is the gave disconfriming information to give another perspective .... compared to this progressive bullshit propaganda on this site. This is my opinion, they are right and gave facts ... I respect that
I regret why I am watching this video now!!! One of the 6marks question yesterday on my economics IGCSE paper was all about premier league footballers high wages
4:13- "There are some situations where wages may actually be higher than market equilibrium. For example, some employers might voluntarily offer higher than normal wages to increase worker productivity and retention".
Wouldn't that just be a case of market equilibrium wages increasing, rather than wages being "higher" than equilibrium? After all, if the employers voluntarily choose to increase wages, that would just represent an increase in the demand for that kind of labour and, hence, a higher equilibrium market wage.
Saeed Baig No, this is a bit more in depth. But the equilibrium wage in perfectly competitive markets, considering CRS. You take the First Order Condition of the neo-classical production function. By doing so, you get MPN = w. The equilibrium wage is hence equal to the marginal product of labour. You can calculate it using partial derivatives. Hence, of firms offer a wage greater than MPN, it is above the equilibrium wage, not a shift if the equilibrium wage.
This is a great video, but I would've liked to hear about how raising the minimum wage would affect specifically the middle classes and skilled workers. I think also they didn't really address the effect raising the minimum wage would have on small business.
Great video !! Can you guys do a segment on healthcare ???
Volunteer exchange , opportunity cost , Derived Demand , Wage Discremination , Collective bargaining .
Hello team, I am from India. I would like to see crash course on international trade agreements. WTO agreements, bilateral, plurilateral and so on. How does these effect the stakeholder countries and small businesses.
Thank you.
Minimum wage just means it's illegal for you to work unless you're worth whatever the minimum wage is. Labor is just a service you buy, and raising the price of labor means people find ways to make due with less of it.
Let's say we're in bizarro world though and demand doesn't change one bit, even if you're unable to be worth minimum wage is. What you have here is a subsidy for low-value workers. You always get more of what you subsidize, so why would people invest in their skills if the end result is making the same amount as before? In either scenario, economic productivity is reduced either due to unemployment or low skill.
The political push for increasing minimum wage is mostly through unions, who often get paid a certain MULTIPLE of minimum wage.
Even if this doesn't convince you minimum wage is a bad idea, a federal minimum wage is as the cost of living is do different in different...not just states...but cities! It should be a local thing. A $15 minimum wage in New York City would be unnoticeable as few there would work for less than that anyway, but in Rome NY the effect on the economy would be devastating.
Wage discrimination is BS these days; if I could save 23% for the same level of productivity by only hiring women, then I'd only hire women and put my competitors out of business. But then, they'd try to do the same, raising demand, and therefore price, of hiring women. That's exactly what we have today; it's whacko conspiracy-theory territory to think otherwise.
+blurglide Yay! Someone else who is against minimum wage! ;D
Labor Markets...Perfect topic for Easter! Why not?
digging the ac/dc belt buckle
8:55 you see the Burger King logo in the reflection... And did you really need to censor that?
When you break it down there is not one single good reason to even have a min. wage.
+whyamimrpink78 lol
+Tom Howard
I know, right. I mean, it is funny how people thing a min. wage is actually a good idea.
Vital Mark lol do you even know your own history? The fact is that min wage is and has always been discriminatory. In British Columbia, a min wage was passed so that Canadians could compete against Japanese immigrants willing to work for less in the lumber industry.
+Vital Mark
Cost of living in a healthy economy falls. Sounds like you need to fix your economic situation in Vancouver.
Prevent exploitation by bad employers
There is another issue: in smaller or less technical countries the utilize cheap labor as it is abundant , a wage could be low but if the cost can be offset by technology then technology may be a cheaper alternative. Much like developed counties . If the fixed cost of labor and benefits plus risk ( employee quitting, labor interruptions Risk) etc then technology can be cheaper but elimination of risk
Could you do a video on comparative advantage (specialization economics) by David Ricardo?
Yeah, Card and Krueger was exposed as bunk. That's also ignoring HUGE numbers of other studies that showed the opposite.
James Adams 9:10 they admitted it
you heard her, it's time to practice our scissoring. any volunteers?
Can you talk about dollarization? Thanks!
Very few places take an unbiased look at this topic. I'll subscribe
6:48
If that grocery store is the ONLY place hiring, and there are more people looking for the job than the positions can be filled, then guess what? Markets DO reach balance, and their fair market value decreases dramatically. So its not that the employees are accepting lower than market value, but rather their market value is pretty low to begin with.
8:00
Spending is nothing, spending merely shuffles money around and doesn't do squat for growth. Only investments and value additive processing, manufacturing, mining, agriculture, etc. actually produce value and increase economic prosperity. Service sectors just help value creators more efficiently create, distribute, and sell their goods/materials.
+Joe Schmoe PREACH! I noticed that this video is delivered mostly by Adrian. Jacob gives a much more balanced approach in his own video. While there are some places to disagree, it's better
Leon Poke
Also, the thumbnail thats put up on the left side inside the circle is an "all seeing eye" triangle with elephant ears/trunk. WTF?
I'm not one for conspiracy's and all but this is getting a little ridiculous at how often I see the Eye of Horus inside triangles just about everywhere. Just saying its getting kind of creepy.
+Joe Schmoe well that is all good news and i agree, silver and are important to stop wealth confiscation & destruction of your families wealth through the means of central banks actions.
CaptainZuluGamma
Anymore I'd bet on ammo being a better investment.
"Workers of the world unite. You have nothing to lose but your chains".. -Karl Marx
When this guy isn't making economics videos he's a Rock 'n Roller! Check out his AC/DC belt... :-)
Employer greed needs to be taken into account. Do not underestimate the devastating effects of this on a great many people.
I love the belt buckle!!
Just a few quick thoughts...
1) If small start ups have to pay this, it will limit entrepreneurs from entering business. This is a big deal since about 80% of start ups fail in this country anyway.
2) Depending on the type of business, the total cost of paying $15/hr. is from $22/hr. to $32/hr.
3) Those who have never been in business or attempted have no idea what an owner goes through... I know a man who slept in his small office for months and ate popcorn for dinner... and people resented his success. How about those sleepless night trying to figure out how to pay your bills and cover payroll? I'm just saying that most people have no idea what it takes to start a business... the level of commitment.
Could the employment rise/min wage rise correlation be the result of overall improving business health? i.e more people on minimum wage means more customers buying more, more often ----> more profit despite increased wage costs?
dear crashcourse , please fix your editing programe's bug since it keeps making the lower and higher bar of the video flicker like crazy
thank you
What wasn't mentioned is that the Krueger and Card study was flawed and its results haven't been replicated. It also defies logic to believe that raising min. wages won't have an impact on employment or sales. Unless a particular market is enjoying a huge amount of growth, the money has to be made up for somewhere. That could mean trimming 40 hour work weeks to 30, laying off employees, or not hiring new employees. Usually raising prices and passing those costs on to consumers isn't the answer because there's a slim margin for what the consumer will pay for a given product. A fast food restaurant may have no problem selling a $5 burger, but if the price is doubled then the consumer may figure for that price she may prefer going to a non-fast food restaurant. If the owner doesn't make up the difference somewhere, then profits will be reduced and the business goes belly up, meaning that the $15 hour min. wage employee now gets $0 per hour along with reduced prospects at finding a new job. Moreover, at the higher wage, employers can be more selective and pick only those with years of experience or a higher than average level of education, which shuts unskilled workers or underskilled workers out of the market. To believe that raising the min. wage will have no adverse effects is to believe in magical thinking, it's to believe in unicorns and rainbows that sprouting outside people's windows.
+Frodojack
There are lots of cities/states where the minimum wage is over 10$/hour ... why didn't the market collapsed?
You know how much McDonalds has to raise it's burger price to have 15$/hour wages? Around 16 cents to have the same billions of dollars in profit ... Why not force corporations to have a little bit less profit? Why do they need that huge amount?
+Frodojack You're not entirely wrong. Your examples don't represent reality. But
they are still sound in principle. Many small businesses I've seen are
run in such a way that the owner has high enough profit margins to allow
for a little wiggle room in labor. What is more realistic is that a
10-30% increase in wages occur, and that the owner may increase price by up
to 5%, which likely causes a slight decrease in sales, depending on the
situation of the substitutes. But if it's a law, then all comparable
businesses are experiencing roughly the same thing, and the decrease
largely comes from those who'll take mcdonalds (with their more inert
pricing) over the mom and pop joint. But most of those people were
probably already doing that, I expect that the actual number of converts
will be low.
Meanwhile the business owner does take a small hit in their bottom line. But this causes innovation. If a 10% increase in labor completely puts them out of business, then they're probably not be running a very good business. It seems more likely that they will find ways to cut waste, they will reconsider their vendors, their capital, their pricing, their products in general. They will slow down on hiring, but they will also be more likely to hire better employees, and more likely to let the bad ones go sooner. all of the reviews and replications of the Card-Krueger study still showed 2-4 times the increase in wage percentage than they saw in decreased minimum wage employment.
This whole process also increases demand throughout the market as employees spend that new money, which will increase sales, allowing the bottom line to recover from previous damage done by the increased labor cost. It's almost like the government is forcing market competition in a way that is upsetting to risk-averse business owners, but overall good for everyone.
jdjack519
You are entirely wrong. Nothing you wrote discredits or even challenges what I wrote. Parts of what you wrote actually agree, like "the business owner does take a small hit in their bottom line." In other parts you just restate what I wrote. The major difference is at the end where you proclaim that the employees will be spending that "new money." Evidently you didn't consider that the "new money" may not make much of a difference since the government created inflation will have driven up prices everywhere else too, and that the "new money" will have new taxes imposed on it. Have you ever actually ran a business?
The major difference is scale. A burger jumping from $5 to $10 over a 30% minimum age increase is entirely unrealistic. Cutting labor by 25%, is more realistic, but not by much. You ignore the fact that quality of employees tends to improve when wages rise, which improves productivity and profits. You act like businesses can't raise prices for fear of consumers switching to a substitute, regardless of the fact that the substitutes will be largely affected in the same way. And you seem to act as though these businesses are already operating as efficiently as possible, creating no room for innovation, which tends to be observably untrue.
Inflation occurs regardless of wage growth, if wages don't grow with inflation, you make low wage workers increasingly unable to afford the goods and services required to maintain good human capital, you gradually reducing demand, and you increase poverty; the externalities of which happen to be bad for the economy. Those new taxes can be spent by the government to create public sector jobs; to improve infrastructure, improve education, and fund research in science and technology. Which are all good for the economy. Broh, do you even Neo-Keynesian business cycles?
jdjack519
No, customers will slow down on making their purchases. They won't buy as much and will stick to necessities. When economies are bad there's an upward trend in auto repair and decline in new car purchases for that very reason. Then of course the first thing you think of with increased taxes is more government spending. In case you haven't noticed, California (where they just raised the min. wage to $15/hr) has hundreds of billions in unfunded debt, and the federal govt has trillions in unfunded debt. A better choice would be to use the money to pay down debts, if there is an increase in tax income. Since all this affects behavior it may in fact reduce tax revenues. The added money to pay those wages doesn't come from thin air, as you seem to believe. And business cycles are a myth used to explain an event that can't be explained by Keynsianism (or its Neo-varieties). They are almost always caused by bad government legislation.
Employers aren't going to change their bottom line. Consumers will need to pay more for the same products and low skill level jobs such as fast food workers running a day crew of 10 people will have to now make due with 5 or 6 workers and work much harder for that extra pay. They'll probably not be as efficient with less man power and therefore, dissatisfied customers who will no longer frequent their establishment. Small-moderate size business owners will slash benefits, 401k matching, PTO, etc, etc. It just seems like it'll do more harm than good.
+dujfraz Exactly a $1 burger now becomes a $2 burger. All an artificial market modifier like minimum wage does is hurt and damage small businesses and drive up prices in general.
Vital Mark It's not fear mongering. It's economics. Could you please source this penny increase?
it hurts middle class , which is small business owners
Nice AC/DC belt and nice video
more, more MORE!
If you rase the minimum wage above an employee's productivity, he will generate a loss to the employer an get fired. It could also force the other employees who didn't get fired to take work harder to cover the job of the guy who got fired.
+Rick Apocalypse Thats a big if.
In the last few decades wages have fallen behind, while productivity kept growing. It's to the point where wages could go up by 10% or more and still be in line with productivity
Strikie That's a myth. Productivity has risen, but not on the same level to all workers. The productivity of office workers have increased thanks to computers and the internet. But the productivity of waitresses, for example, remains the same. That's why you can't compare AVERAGE productivity with MEDIAN compensation.
Strikie Also, GDP has risen side by side with productivity. That means companies have been producing more. If they have been producing more, that means they have lowered their prices. Otherwise they would have an overproduction. If their prices have lowered, that means people's purchasing power have increased.
Yes pay people according to productivity. I'm sure you get many nurses, chefs, firemen, clerks and teachers by doing so. I'm sure people are happy to do expensive educations to get jobs with 3rd world wages for low productive service sector jobs, while industry workers get paid 400 times more thanks to productivity increases since the 1800s.
o_O Wow, i am glad i live in Australia.
+Film Monk Productions Your higher cost of living essentially negates the effects a higher minimum wage benefits you, It's a similar affect to living in a big US city that has a higher min wage, also is the minimum wage there 17.29 AUD aka 13ish USD
Australia is are shithole . middleclass and small business owners taxed to hell here
Hey I am Australian, and I don't like minimum wage, due to not barely any shifts thanks to a high wage cost
Labor Market , Voluntary Exchange , Skills , Wage Discrimination , Monopsy , Efficacy Wages , Union , Minium Wage .
minimum wage is essential in rich advanced economies to counteract the impact of migration of the poor to those nations. Without the minimum wage, the floor price of unskilled work would continue to fall, while the rich pocket the additional profit of exploiting the poor.
Raising the minimum wage will crush small businesses and therefore result in a net loss in jobs. Being paid 5.25/hour is MUCH BETTER than being homeless. Not to mention the increase in the cost of goods which hurts the middle class.
NOBODY has a right to a job at the salary they want with the benefits that they want. There is no such thing as a "living wage." You either earn your salary or die on the streets. Ultimately, your life is worthless to me and I could care less if you died on the streets. Just don't make me pay higher prices for goods and we won't have a problem.
Is there a measurement of how minimum wage effects the amount of new small businesses that emerge?
+Qio Cio here: it doesn't, the only people who spout that are the major corporations or those in their pocket, as they do not want to pay people on the bottom a decent wage as they will loose 1% in profit
+Qio Cio Luckily small businesses dont exist in a vacuum, so whats being said here probably still applies.
so small businesses like a lemonade stand can pay 15 a hour?
Good job at keeping this politically neutral!
I dont watch CC economics vids very often. But this one seemed interesting, and it was!
Love this channel
It's the guy from ACDC economics! He's great.
"I'm not gonna tell you what to think buuuut, here's what you should think"
I believe we should lower the minimum wage.
We should do the opposite
I guess you don't work minimum wage
The only people who can be fairly described as "Classical Economists" are time-travelers from the 19th Century. Anyone who resembles one and hasn't recently stepped out of a time machine is called a "poor student."
Love that AC/DC belt