The White House lauded a Congressional Budget Office report on the proposed minimum wage hike to $10.10 per hour while brushing off one key finding: that such a bill could cost half a million jobs, and maybe more. […]
“Overall the logic for the finding that raising the minimum wage does not result in large adverse impacts on employment is that paying workers a better wage can improve productivity and thereby reduce unit labor costs. These adjustments, along with others that firms can make, help explain why the increase in the minimum wage need not lead to a reduction in employment. Higher wages lead to lower turnover, reducing the amount employers must spend recruiting and training new employees. Paying workers more can also improve motivation, morale, focus, and health, all of which can make workers more productive. In addition, by reducing absenteeism, higher wages can increase the productivity of coworkers who depend on each other or work in teams. In addition, businesses can adjust in other ways rather than reducing employment (for example, by accepting lower profit margins). CBO’s estimates do not appear to fully reflect the increased emphasis on all of these factors from the recent economics literature.”
And who doesn’t want to make less money?
In a perfect world where growth is inevitable and inexorable – maybe that might work.
But this idea is still more proof Obama is no Bible reading Christian…..
Pharaoh dreamed about 7 fat animals and 7 thick sheaths of wheat then 7 skinny ones and wimpy sheaths of wheat.
In Chapter 41 of Genesis is how he related that dream to his slave Joseph.
Joseph correctly interpreted that dream so that Egypt saved plenty during their ”fat” years and therefore had enough to not starve during the next 7 years of drought and famine.
Obama presumes business owners are as stupid and short-sighted as he is.
They are not.
No way can a business survive if it does not plan for the off year (or years.)
Because accepting lower profit margins grows the economy, right? Because people go into business to make the least amount of money possible simply to feel good about themselves, right? Because the frustration of dealing with government regulations, unemployment taxes, employer portion of SS taxes, collecting sales taxes, workman’s comp taxes, buying/replacing equipment and supplies, the cost of training new employees, obamacare taxes AND income taxes….just minor annoyances that a business doesn’t need to worry about…..
@Pete: True.
Obama must be mortified by Hollywood threatening to film outside of CA unless they get more and better tax cuts.
(They also want pollution rights.)
I got rid of my one and only employee a couple of years ago. After two and a half years on the job he was coming to work angry every day that he didn’t own the business himself or at least manage it independently. It was beyond him to realize that it had taken me forty years to accumulate the tools and skills to run the business, or that it had taken me twenty-five years to build up the market for the tool I made, or that until just a couple of years before he went to work for me, I had been making less than he was. His attitude towards his increasingly costly careless mistakes was that if I was still in the black, even if only by a few percent, then any mistakes didn’t matter — I was still making a “profit”. Oh, and by the way, I was paying him $25 an hour, not minimum wage.
@Tom: Oh, Tom!
You struck a nerve.
Part of the reason hubby retired early was the attitude of young men he thought (based on resumes) might make good employees.
Too many of them wanted to be bosses.
And, without a whit of experience, too!
But, before firing them hubby used to allow them to fill in for a vacationing head of a department so as to see if their bluster had anything behind it.
No and no.
Sometimes it was ”party city!”
The boss was away, after all.
Other times it was, ”I forgot.”
Who knew you needed more of stuff you use in great quantity every day?
But the worst were the ones who used their time on the job to run down the best managers (as well as hubby, their boss) in secret.
When given a tad of responsibility, these last ones found themselves in the very position of evil boss.
Guess what?
They turned into little Hitlers worse than their poor workers ever had under the regular management.
LOL!