Saturday, June 03, 2017

Minimum Wage Earners Are Scum

Forgive the length of this. I'm passionate about it.

So Ontario's minimum wage is going to be $15/hr in 2019, barring the Regressive Conservatives winning the next provincial election.

The horror! The sky is falling! The economy will implode! We're all doomed! etc. etc. etc.

It's been, what, a week? since this was announced, and already I am sick to death of the constant slurs on minimum wage workers and their "McJobs".

And yes, indeed that is because I have a McJob. I don't make minimum wage, but $15/hr represents a substantial raise for me.

And many of my friends are in the same boat. Which is not exactly seaworthy. What REALLY puzzles and infuriates me is that so many people in the boat are busily sawing holes in the keel, and anyone appearing with a baling bucket or patches is told in no uncertain terms to fuck off and thrown overboard if they persist.

Since the announcement, I have heard people argue the following:
  • that at $15 an hour, small businesses are going to close by the thousands
  • that people will be automated out of jobs because the minimum wage is unsupportable
  • that the cost of everything is just going to go up and negate the increase anyway
  • that "starter jobs" are worth the current minimum wage either because they're unskilled or because other jobs don't make much more and are skilled
  • that clearly, I have a massive case of wealth envy
Let's tackle these one at a time. 

The minimum wage in Canada came into effect in 1965, and has obviously increased over time (albeit barely keeping up with inflation). If there have been waves of small business closings with each rise in the minimum wage, I missed them and can't find any evidence for them. In fact, it seems like raising the minimum wage encourages hiring and lowers the unemployment rate. (American article dating back to 1938, but the same conditions apply here). 

Oh, yes, if you own a small business -- or any business -- your payroll expense is going to jump. But that's only one side of the equation...and it's more than offset by the other side. For that other side, let's turn to Jay Mason-Grant. In a post he shared on Facebook, he had this to say:

So Ontario is raising the minimum wage to $15. But what will all the small businesses do?! Well I own a small business, so let me tell you how I feel about it: It's excellent. 

"But Jay, this is going to be just one extra expense, it could crush you!"
No, it won't. Because this is being rolled out over the next two years. I have time to plan, I have to ready myself. 

Make no mistake, payroll is about to jump significantly for me. It's also going to come with a much higher share of taxes from me (because I pay as much in payroll tax for my employees as they do). Also, I am not just swimming in profits right now. I pay myself no more per hour than I do my staff, so this isn't just delaying a swimming pool or fat cat CEO bonus. This will hurt.

For a moment.

But let's not forget what money in the pockets of those with the lowest income does: it goes right back out there. I'm about to own a small business in a city where everyone is making $15 an hour! I can't WAIT to see where the newly disposable income of that high-school kid goes, or what that single mother is able to treat her kids to that she couldn't before. The disposable income available for my business to bid on in this city is about to go through the roof! So I will take the growing pains, gladly. I will take the stress that comes with my business suddenly being forced to treat my employees better. They deserve it! I'm grateful of the forceful hand of the government making me do right by them!

"But Jay, you could have paid them better before this!" Absolutely I could have, and probably should have. But there is a difference between asking a small sometimes struggling business to go out of pocket more just because it's the right thing, and mandating it: when you mandate it my business benefits immediately from the boost in pay of all the people around me. The difference is the opportunity I gain from having every single person in my city making a living wage. 

So how does this small businessman feel about this brutal, politically motivated, government overreach? 

 I am thrilled!

Both this man's points could not be more valid. Suddenly more people can afford to frequent your establishment, and everybody is on the same playing's not as if he has to pay $15/hr while everyone else can pay $11.40 if they wish.


Let's face it: some jobs are doomed. Truck drivers (who make more than minimum wage) are among the first on the chopping block as their vehicles get automated out from under them (though I'd like to see an automated truck handle a Canadian winter...)
Yes, there may be some companies that decide a machine is better than a decently-paid, and therefore presumably motivated and productive employee. I can tell you Costco experimented with self-serve checkouts more than five years ago. They found that employees were considerably more efficient, so they scrapped the self-serve checkouts. Maybe that has to do with Costco paying its staff between 1.5-2 times the industry standard. (Yes, I've tried to get in there. You need a driver's license to work for that company, for reasons not clear.)

I'm sure automation will proceed apace where it makes economic sense. Actually divide the increase per unit of work, whatever that may be, though, and suddenly the minimum wage increase doesn't look quite so frightening. Say I'm a minimum wage piece of pond scum stocking shelves: 80 cases an hour was the standard at the last place I worked. Let's assume an average of 9 units per case. A little kitchen table arithmetic tells us at the current minimum wage, each unit carries an associated payroll expense of about a cent and a half to stock. Whereas come 2019, it'll be...two cents. Holy shit, it's the end of the world.

Yes, I know, there are more than stockers in stores. But still. Get a grip.


Just as with automation, inflation will happen. It used to cost a quarter to put air in your tires; it now costs a dollar; I rest my case, inflation is a thing. Does a spike in minimum wage drive inflation?

Not in Seattle, it doesn't. (As an aside, I got into a rather heated debate with someone who claimed to live in Seattle and who cited me all sorts of evidence of price increases, without seeming to realize that prices have increased everywhere. He then denigrated myself and people like me who don't do "real work", by which he meant the trades, and I abandoned any attempt at persuasion at that point.)


Let's talk about the intrinsic worth of jobs here for a minute, okay?

I don't have scientific data here. What I've got is a whole lot of platitudes I've heard all my life. Things like "our associates are the face of our business." Things like "every employee is a valued member of our team". You know, like that.

Some places actually walk that walk. Most don't, though. They underinvest in their employees and then wonder why their turnover is so high and the employees they do attract tend to be substandard.

There once was a time when "an honest day's work" got you "an honest day's pay". I assure you, having worked a slew of them, that most "McJobs" do in fact involve hard work and more than their fair share of indignities. I've had my glasses repeatedly fall off my face from sweating in a kitchen; many a day I've come home aching and tired and ready to eat the asshole out of a dead camel; I've had a man hose me down with gasoline because I told him he had to turn his engine off to pump fuel (and if you're wondering how he managed to pump fuel all over me, the story is here). In fact, I have an entire book full of assorted and sundry bullshit I've suffered working for minimum wage or close to it.


At least 90% of you, in this time of extremes, read that preceding sentence and have concluded that Ken thinks anyone working full time should be rich. I DID NOT SAY THAT. I said NOT POOR.

" dare they raise the minimum wage? I make $10/hour more than that and I'M struggling". Yeah, buddy, that's what we need, more people struggling, not less.

If your job doesn't pay you enough, no matter what that job is, what other people make is irrelevant. This goes for CEOs, incidentally, too. Yes, their wages are obscene, you'll get no argument out of me on that. No, nobody on the planet NEEDS that kind of money. Most CEOs are so far out of touch with the day to day realities of their lowest paid employees that they have no least idea what those employees even do. Remember that show "Undercover Boss"? Time after time the company president couldn't even perform the most menial task properly, and he (it was almost always a he) would come away from the shoot with a newfound appreciation of, well, what hard work really is.


Which brings me to wealth envy.

I have been accused of this every single time I argue the poor deserve a better lot. I find it tiresome and really, quite telling that I'll hear "wealth envy" even if I don't utter a word about wealthy people.

I do not want to be rich. Honestly, I don't. I have rich friends. They go out at least once a week somewhere swank to eat and the number of concerts and sporting events they attend is staggering. I DO envy them some of these experiences. By no means all, or even most.

I used to be rich--or at least richer than the vast majority of people my age. When I entered university, I had ten thousand dollars in my bank account AFTER ALL scholastic and living expenses for the year were paid for. I remember eating almost every single meal out and buying whatever struck my fancy. There was a hole where my soul should have been and I tried to fill it with stuff.

I am NOT saying my friends have holes in their souls. Not even close. But what works for them would be overload for me. Give me one special event every few months. For me, I find that more than sufficient.

There is a nuance here. The minimum wage has barely kept pace with inflation for the last forty some odd years. Meanwhile, compensation for the richest among us has increased by an almost unfathomable percentage. I'm not begrudging the super-rich one penny, but do tell: how is it their jobs have become so, so, SO much MORE valuable, percentage-wise, while mine and those of others like me are valued the same in real dollars as they were a half century ago?  By all means let them have their millions. But why is it a zero-sum game? Why must the poor stay poor?

The answer, I'm convinced, is the title of this blog. And isn't that sad?

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