Minimum Wage – That Is Your Growth Plan?

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I really do admire and respect the President, but raising the minimum wage as a growth strategy does not line up with memories of my Jimmy Carter era high school economics class.  I favor a minimum wage as a floor to exploitation, but nobody I know argues it results in more jobs and more hiring.   President Obama is just not a fan of private enterprise expansion.

Actions are louder than words.  The more expensive labor costs, the more corporate executives retard budgeted and unbudgeted hiring.  That is true in my personal experience throughout the US, Canada, the UK, France, the Netherlands, Germany, and Denmark where I ran or had some executive responsibility for various manufacturing and high tech businesses.

But all my early jobs were in small businesses.  Our son, Jack, is sixteen and looking for his first summer job.  My first job beyond the family was at age 15.  I was the junior guy in a delicatessen in Highland Park Plaza in Dallas.  The owners were two Jewish guys, but they were not equal partners.  It made for an unusual hierarchal management style worthy in my view of a TV sitcom.

I cleaned out the grease trap and once a bathroom that had the appearance of a ritual killing site, scrubbed floors and dishes, and did every dirty job in the book for $2.50 an hour plus lunch.  It was the first time I had an African-American as a peer in anything, who was also a mid-twenties single woman.  An altogether great cultural and fantastic culinary experience.

Minimum wage was actually $2.65 an hour.  In my first hard ball negotiation with one of the owners I asked for $2.65.  He told me to take $2.50 or he offered me his hand.  Dad confirmed for me there was some sort of exemption for him to hire me into the job.

Now you can say I was exploited.  But, I hope Jack has half as positive an experience as I had that four months.  And raising the minimum wage in Colorado and huge parts of the country is not going to make finding that summer job any easier.  It is an opportunity killer.

Mr. President, please remember that there is still almost 8% unemployment.  Strip out college graduates and the picture is scandalous.   Please, focus.

 

3 COMMENTS

  1. I appreciate that minimum wage increases might have a deleterious effect on some decisions to hire. If you accept the need for a minumum wage to prevent exploitation, then you have to examine the floor rate in light of % of workforce at minimum wage, cost indices and poverty statistics. Exceptions for students and many entry-level jobs have been a part of the law for many years and should continue. Whether $7.25 or $9 p/hour I cannot say, but I do believe it is an appropriate (if blunt) tool to consider employing to address the growing number of working Americans who live below the poverty line. I would not dismiss it out of hand.

    • Vince, I just think it is emblematic of an unfocused start to the term. The election was about jobs first. Since the election it has been gun control, phony budget fights, minimum wage, qualified but poor cabinet picks, and defense cuts in the face of Chinese defense expansion.

      None of that is helping jobs and defense cuts and minimum wage are actively hurting it.

      This is also best left to states to vary according to conditions. 9/hr is not a living wage in NYC I’m sure but throughout CO and many states, particularly rural it is over the top.

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