Alternative Minumum Wages?

Question

One problem with the minimum wage is that it is the same minimum wage for everybody, from teenagers flipping burgers to entry-level skilled laborers. Obviously, a $6.50 wage is not enough for a high-school graduate who is starting out on his own, but $9.00 is too much for a 16-year-old peddling french fries.

So why don't we create a multi-tiered minimum wage?

TEEN - Anyone 18 or younger, single with no dependents - $5.75/hr

UNSKILLED - Anyone 19+ OR Married OR with dependents, with less than 2 years work history at this level - %7.00/hr

SKILLED - Anyone at any age with 2 years of work history at the UNSKILLED level - $9.00/hr

So a kid might get a job flipping burgers for 2 years at the TEEN level, then move up to UNSKILLED upon High School graduation. After two years, he moves up to SKILLED.

A 17-year-old who is married or has a child, though, can go immediately into the UNSKILLED category.

Would this be good for business and workers? Opinions?

For those of you who advocate letting market forces determine the wage people are paid, I invite you to take a look at the sweatshops of the 1890s. Employers WILL conspire to keep wages down. And the people at the bottom of the wage chart have no leverage with which to negotiate: they need the job and may have to take it no matter what the pay. You're 'free market' approach assumes that the low-wage worker has a choice. Often, he does not. Either desperation drives him to take the low-paying job, or employers refuse to compete for unskilled workers.

Answer 1

What you are referring to is call a 'living wage'.

Answer 2

You are complicating a very simple issue, much lip service is paid to liberty and freedom but what you and any other minimum wage system proposes is to coerce others into either paying more for what they otherwise would have or into charging more for what they otherwise would have. But lets assume that we did coerce people into doing this, where do you think the money will come from, when the producer has to pay more to produce, the increased wage doesn't pay itself, that producer must charge more for his goods. Hence anyone who buys his goods be it a consumer or another producer, will have to pay more. Inevitably the increased wage will balance out with increased prices, however there will be a delay in the market adjusting to the various price increases. And whom does this adjustment hurt, the very same low income workers it was "meant" to help. When a minimum wage is set it affect the prices of goods which are produced at minimum wage, and goods which depend on components which are produced at minimum wage, and it is the lower income worker who tends to spend a far greater proportion of his wage on these goods. Not to mention the delay which occurs as the market adjusts the prices throughout the chain of production hurts these lower earners worse, because, the delay goes largely unthought of (hence the appeal of minimum wages), when the worker perceives himself to possess more money, he tends to spend more money, failing to see the decreased purchasing power of his money due to the ongoing process of price adjustment. A very easy way to look at it is with large numbers for why draw this abitrary and coercive number at $5.75, $7 or $9, why not 1 million dollars an hour, then we'd all be rich right. Ofcourse then its easy to see the nonsense, because a loaf of bread will quickly cost $ 200 000, well it works no different when set at a lower wage, it is just way less noticeable, a penny here a nickle there. And the above is simply why it won't work (unless your goal is more poverty), not whether it is right or wrong. It is wrong because it is coercive, we are to be free! If i spend my time to make something no matter how much effort i exerted it is mine and I can charge what i wish for my time and effort, be it some shells glued to bark, if I want to charge one million dollars i can, it won't sell but i can ask for it. This applies across the board, if i want to pay my worker $5 an hour and he wants to work for that amount then it is a voluntary exchange, it is freedom, but to coerce someone into paying more, into disposing more of their product then they wanted on labor that is slavery, for the definition of a slave is simply: one who produces while another disposes of that product. And that is what minimum wages are coercive methods used to dispose of the product of others.

Answer 3

Why not carry this Minimum Wage raising issue to it's extreme. Let's raise the minimum wage to $100,000 per year.

Do you really think that will solve the problem? Study economics and learn a little!

Answer 4

No, we should eliminate minimum wage all together and people should be paid what they are worth, then maybe that will encourage more people to take pride in their jobs instead of expecting the government to suppliment their laziness with mandatory raises.

Answer 5

Minimum wage is bad for businesses. That is why the Kennedy's are so pro-minimum wage in the US, they have all of their businesses in other countries.