The Math Behind Higher Pay at McDonald's - what do you think?

Macroeconomics clearly shows the benefits of a strong middle class. Of a society that has greater upward mobility. Anecdotes--even unsubstantiated ones--are fine, but they don't prove anything.

But as I said before, this isn't an economic issue. It's a societal one. It's one about your values.

 

I grew up "less then advantaged" and was going down the wrong road. I made some choices and here I am. Could I have made the same choices as my sister and her kids - yes. They are stuck in the poverty-cycle. I don't think a McDonalds job was meant as a career move but some people have made it that and expect others to pay for what they "think they should get".

 

Very few unskilled labor jobs with no education requirements were ever meant to support a family. As far as I can remember in my lifetime back to the 70's, these jobs were meant for kids, students, as temporary jobs, extra money, etc. Someone trying to support a family of four with such a job is making a bad decision.

I think many/most poor people have made bad decisions in life and are suffering the consequences of their own bad choices. Bad decisions like having kids at a young age and/or out of wedlock, dropping out of school, not going to college, not learning a trade or skill, being lazy, faking disability (I know many), committing crime, doing drugs, etc. Those constantly trying to reduce the pain or consequences of making bad decisions (i.e. safety nets, handouts, blame game, victimization, etc.) in life only makes people and society worse off.

I know that sounds harsh, but I have been poor and I have lived around poor people. I have worked at several fast food restaurants and have done other unskilled labor jobs. These jobs were just stepping stones for me. Life was not meant to be easy and you have to work very hard to succeed. Those who don't will always have a tougher life then those that do.

There are many, many opportunities for poor people to gain skills and/or an education at minimal cost if they are willing to make that choice and put in the hard work. Of course they need to refrain from making bad decisions as well.

 

No, no it doesn't. It hinders job creation/growth because employers choose to hirer less when they have to pay entry level workers more. This can't be debated, it's simple economics.

You're correct that it's simple, but it's certainly not wrong. People try to make things more complicated than they need to be. Guess what, you don't like what Burger King is paying, you don't have to work there. Don't worry, there is someone right behind you that will take that job. It's not the fast food industry's fault you never developed a valuable skill set. You should appreciate the fact that you have a job and a chance to prove yourself/get promoted.

Ahh yes, because if history has proven anything it's that when a bunch of politicians - with no understanding of economics and whose only interest is getting reelected - intervene everyone is better off!

Not true. The minimum wage prevents people who would be willing to work from getting a job because employment is stifled by a mandatory minimum wage. Science.

The market would be free if the government would get out of the way. That money you referenced goes to shareholders who invest in the company so that it has capital to grow or is invested, as it should be. You have no right to demand that a private company pay more or dictate what they do with their cash. Workers are paid a fair wage based on their skill set(s). If your skill set isn't in high demand/hard to come by, then guess what? You're going to earn less. Take the job as an opportunity to learn a skill and improve your lot in life.

You're right. I'm a big fat jerk because I understand that most people in minimum wage jobs are there because they have no marketable skills. As far as my values; I don't believe we should vilify people for success. I don't think the people who got an education, spent the first decade or two of their career working 15+hour days, and are now wealthy should be vilified. We tell kids they can be whatever they want, some go out and achieve it and then an element of our society paints them as evil/greedy. Seems from your position, the guy who went out and busted his ass to be a success now has an obligation to support the idiot who did everything wrong and now wonders why he can't make more than $9 an hour. Clearly my values are based in whats fair, I don't think it's fair to ask someone who did everything right to support someone who did everything wrong.

 

That's because many union contracts have clauses that if minimum wage goes up their pay goes up. This is in addition to their other agreed upon pay increases.

Australia pays fast-food workers $15 per hour but gets much more productivity out of the workers and their are fewer workers. Haven't we seen this recipe before? Higher wages eliminating jobs and increasing usage of technology.

This statistic is alarming. I'd like to know more about the minimum wage workers. What percent are over 22 years of age, length of current employment, skills, education level, children, married, criminal record, etc.

Why are these jobs all they have left? Are they the only jobs in which the workers are qualified? Do these workers have skills or education that are not in demand? Are these workers those who have lost skilled jobs?

 

Ask Jennifer how much someone makes as a Chef? Now tell me why a guy nuking nuggets should be paid what that same person with a few years training and experience as an actual Chef can make (which is not much). Not every poor person is some down on his luck awe shucks just had a bad break angel in hiding. Spend more time around poor people and you'll discover something that most of them have in common. Besides, think about all those disgusting poor people who are religous, or shop at Wal-Mart, or might be gun owning rednecks who live in the south (whatever disgust the right kinds of white people about the wrongs kinds of white people). That can help your bleeding heart look a little more clearly.

Anyway, what will you do when there are no more low skill low paying jobs anymore?

McDonald's hires 7,000 touch-screen cashiers.

 

According to Swanson and Holton, economic theory is a part of human resource development theory (HRD). The East Asian tigers used HRD as a means of creating economic growth. Actually, they transformed their economies using it. And it was a conscious decision on the part of their governments to do so. The governments transformed their respective economies by driving up the skills levels of their people. Using (mostly) strong qualifications frameworks, these economies moved workers from agrarian and low-tech roles to highly productive and high-tech jobs. (See Wade.)

The governments didn't leave it to the corporations, who just have a long history of exploiting workers. Instead, the governments took control of certain sectors of their economies and transformed them.

So fine, don't guarantee a living wage to all workers. But give people a pathway out. And then go find someone else to fry up your McNuggets and sell them to you for next to nothing.

Doing nothing, however, should not be an option. Leaving it to corporations is a recipe for long-term failure. The markets they run aren't free; they're rigged in their favor. It was government that busted all that up a hundred years ago. And it is government that can transform our economy again.

 

You must work in the public sector. I've also got the sneaking suspicion that you've either been reading Robert Wade books recently or took some free MOOC utilizing his text. So legitimate question here, are you a socialist or a communist?

 

I've never been a member of the Communist Party of the United States, but I've voted for Socialist presidential candidates on three occasions.

 

Right. I haven't been working in HRD for 35 years. I haven't studied it academically. I haven't been trained in macroeconomics. And my work experience is limited to 5 years working as a civil servant. I'm not a retired Air Force officer. I didn't run my own consulting practice. I didn't work for CSM, AT&T, Xerox, Prudential, UoP, and CCA. I didn't teach for San Diego State, Bellevue, UoP, VIU, Webster, or UVa. I don't have an MBA and a Ph.D. And I didn't write the attached paper--which addresses these issues and cites Wade--almost four years ago. (Apologies for the stripped formatting--required to allow upload.)

Yeah, everything I know was acquired last week. And even if it was true, it wouldn't matter, because this isn't about me, no matter how hard someone else tries to make it so.

 

Wow, think I might of touched a nerve....

 

I would have probably just given her some nuggets, sheeesh.

What happens when we pay $15 an hour and all the workers now are replaced by people who can give good customer service, show up to work on time, and not spit in the shake machine? All of these noble peasants will be out of jobs. What then?

 

We go into McDonald's every now and then. It doesn't matter which one we go into, there's always workers just standing around doing nothing. If McDonald's owners want to pay people $15 to stand around and do nothing, that's their choice. I much prefer Chick-Fil-A anyway. At least the people who work there are polite.

-Matt

 

My wife and I just reserved our free Chick-fil-a "Chainwide Giveaway" breakfasts for next week. (I believe this give away overloaded their reservation system.)

 

Macroeconomics is not a zero-sum game. That's why we talk about the economy growing.

Raising the minimum wage would not automatically (or in any other way) decrease the number of people employed. In other words, the amount of money available for salaries is not fixed.

Raising the minimum wage will, however, have a stimulating effect on the economy, putting more dollars into it, which generates even more economic activity. There are limits to this--hence the stupid $50K example. But a 50% raise in the minimum wage, for example, would have a positive effect. It will serve to shake loose some of the cash businesses and the wealthy are sitting on--their disproportionate gains in during the aughts.

Money flowing through the economy is a good thing.

The non-economic argument is that we should honor honest labor. But I guess that's too hard.

 

Chick-fil-A has 14% of its problem figured out.