The Minimum Wage and Its Impact on Jobs
Many politicians continue to push for increases to the minimum wage because the cost of living continues to rise. Politicians have no concept of what a job, a payroll, or what the costs of goods are, therefore they should keep their mouths shut about issues they cannot understand.
Any time the minimum wage is increased jobs are lost. Full time employees become part time employees and new jobs are put on hold. Employers decide what a job is worth based on how that job contributes to the cost of goods or services for the company. Politicians with experience confiscating wealth from taxpayers and then misspending the proceeds from that confiscation can’t be expected to understand jobs and pay scales.
A company hires men and women to perform jobs that lead to the production of good and services available for sale to the public. The goods and services are available for sale on a competitive basis in the marketplace. Company A manufactures widgets and sells them for $1.00 a piece, but Company B Manufactures and sells similar widgets for $.95 the prices are similar and both sell, but Company B has an advantage and sells more of their widgets than Company A does.
An increase in the cost of goods within Company A will cause the price that Company A can sell their widgets for to increase. An increase in the overhead such as rent, taxes, electricity, insurance, or anything else the company has to pay for will cause the price of their widgets to increase. Company A is not a public service, it is a company designed to make money for the owners. Without a profit there is no reason for Company A to exist. The profit is a good thing, not evil and not excessive.
The jobs that go into making, selling and distributing the widgets are all worth something. But their worth is determined by how they contribute to the finished product. Artificially increasing the wage of the lowest skilled employees will have a negative impact on the cost of the widget and will cause Company A’s widgets to be too expensive to compete in the marketplace.
The value of a job is determined by management based on how it impacts the completive position of the product sold. When the wage is too low for the type of work in an area the employer will not have anyone who is willing to perform the job and the marketplace will cause the employer to increase the wage.
Free market forces should cause the wages to rise and fall, not politicians with handlers, and campaign contributors to satisfy.
A company’s profits, the cost of goods and free markets forces should all impact what a job is worth to an employer. How the compensation for that job impacts the employee’s ability to support the employee and their family is a factor that causes the employee to accept a job or not.
Skills, experience, and education are qualities that open doors to jobs that pay more than the minimum wage. An employee who faces difficulties supporting themselves and their families need to have more than one job, or improve their skills and experience to earn a better wage.
Self-sufficiency and the free market are the elements that can have a positive impact on the minimum wage. Politicians who are trying to pay back debts owed to power brokers and labor unions cannot possibly have a positive impact on the work place.
You cannot legislate prosperity or success. Hard work, a positive attitude, and the desire to be self-sufficient and successful will always lead to a better way of life. The free market and competition in the market place will maintain a successful business and create and maintain jobs in a sour economy as well as a healthy economy.