Minimum Wage increases

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#2148697 21-Dec-2018 10:03

tdgeek:

I dont buy the issue with small businesses. If costs increase, so do prices, that happens all the time. The % these people will get is high, but its still $1-20 per hour. Businesses face more cost variations with fuel, and the exchange rate effect than $1-20 per hour. And annual CPI 2% increases for other staff on higher rates. If a business is that marginal, then other cost increases and lower than expected sales would surely hurt more. If we want a low wage economy then perhaps the Govt needs to implement a price freeze so that the low wage economy is matched by a low price increase economy. But that would create anger

Annual increases of 2% PA are pretty rare. I've never had a 'general CPI adjustment' as part of any contract.

If the lifting the minimum wage really doesn't cause any issues for businesses then why not go directly to $20. Or $30?

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#2148703 21-Dec-2018 10:18

GV27:

tdgeek:

I dont buy the issue with small businesses. If costs increase, so do prices, that happens all the time. The % these people will get is high, but its still $1-20 per hour. Businesses face more cost variations with fuel, and the exchange rate effect than $1-20 per hour. And annual CPI 2% increases for other staff on higher rates. If a business is that marginal, then other cost increases and lower than expected sales would surely hurt more. If we want a low wage economy then perhaps the Govt needs to implement a price freeze so that the low wage economy is matched by a low price increase economy. But that would create anger

Annual increases of 2% PA are pretty rare. I've never had a 'general CPI adjustment' as part of any contract.

If the lifting the minimum wage really doesn't cause any issues for businesses then why not go directly to $20. Or $30?

I should have named it "annual review". Where employees often recieve an increase based on inflation, or less if they aren't great or more if they are great. Or less if the business is struggling, or more or less depending on the business owner

$30?? That's a bit silly :-) Some seem to feel that the increase of the really low minimum pay for the lowest income earners in NZ isn't right, its bad for businesses. I don't believe that's correct as per the points I made.

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#2148732 21-Dec-2018 11:31

tdgeek:

$30?? That's a bit silly :-) Some seem to feel that the increase of the really low minimum pay for the lowest income earners in NZ isn't right, its bad for businesses. I don't believe that's correct as per the points I made.

I guess that begs the question - what makes $20 overdue and "sensible" and what makes $30 silly? A decade ago, $20 would have been silly, and at some point in the future $30 will be "barely enough". What inputs need to go into the evaluation of what the appropriate amount should be?

I'm not going to argue that "it isn't right", but I can see how this move is going to increase the level of industrial action that we see in NZ over the next few years.

Minimum wage is the very least that you're allowed to pay your most unproductive workers. These workers have just been awarded a >%7 payrise for absolutely no reciprocal increase in their performance or output. (I'm not saying that it necessarily won't happen, only that it's not required in order to receive the extra income). For the remainder of the workforce, this will set a point of reference. If they (as more highly valued and remunerated employees) don't also receive similar or greater increases, they will feel less valued, and risk becoming disenfranchised. As has been alluded to earlier, the deal that the Nurses won for all their striking (and associated loss of income) now looks to be much less of a victory in the context of what has just been awarded to 210,000 kiwi workers. (who had already amassed >15% pay increases over the last 4yrs)

The pressure for middle-incomes to be lifted will be greatly increased. And naturally, this will also have an effect on upper-incomes too. This will cost businesses much more than $47/wk.

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#2148737 21-Dec-2018 11:34

6FIEND:

tdgeek:

$30?? That's a bit silly :-) Some seem to feel that the increase of the really low minimum pay for the lowest income earners in NZ isn't right, its bad for businesses. I don't believe that's correct as per the points I made.

I guess that begs the question - what makes $20 overdue and "sensible" and what makes $30 silly? A decade ago, $20 would have been silly, and at some point in the future $30 will be "barely enough". What inputs need to go into the evaluation of what the appropriate amount should be?

I'm not going to argue that "it isn't right", but I can see how this move is going to increase the level of industrial action that we see in NZ over the next few years.

Minimum wage is the very least that you're allowed to pay your most unproductive workers. These workers have just been awarded a >%7 payrise for absolutely no reciprocal increase in their performance or output. (I'm not saying that it necessarily won't happen, only that it's not required in order to receive the extra income). For the remainder of the workforce, this will set a point of reference. If they (as more highly valued and remunerated employees) don't also receive similar or greater increases, they will feel less valued, and risk becoming disenfranchised. As has been alluded to earlier, the deal that the Nurses won for all their striking (and associated loss of income) now looks to be much less of a victory in the context of what has just been awarded to 210,000 kiwi workers. (who had already amassed >15% pay increases over the last 4yrs)

The pressure for middle-incomes to be lifted will be greatly increased. And naturally, this will also have an effect on upper-incomes too. This will cost businesses much more than $47/wk.

A reasoned and well thought out reply.

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#2148739 21-Dec-2018 11:37

6FIEND:

tdgeek:

$30?? That's a bit silly :-) Some seem to feel that the increase of the really low minimum pay for the lowest income earners in NZ isn't right, its bad for businesses. I don't believe that's correct as per the points I made.

I guess that begs the question - what makes $20 overdue and "sensible" and what makes $30 silly? A decade ago, $20 would have been silly, and at some point in the future $30 will be "barely enough". What inputs need to go into the evaluation of what the appropriate amount should be?

I'm not going to argue that "it isn't right", but I can see how this move is going to increase the level of industrial action that we see in NZ over the next few years.

Minimum wage is the very least that you're allowed to pay your most unproductive workers. These workers have just been awarded a >%7 payrise for absolutely no reciprocal increase in their performance or output. (I'm not saying that it necessarily won't happen, only that it's not required in order to receive the extra income). For the remainder of the workforce, this will set a point of reference. If they (as more highly valued and remunerated employees) don't also receive similar or greater increases, they will feel less valued, and risk becoming disenfranchised. As has been alluded to earlier, the deal that the Nurses won for all their striking (and associated loss of income) now looks to be much less of a victory in the context of what has just been awarded to 210,000 kiwi workers. (who had already amassed >15% pay increases over the last 4yrs)

The pressure for middle-incomes to be lifted will be greatly increased. And naturally, this will also have an effect on upper-incomes too. This will cost businesses much more than $47/wk.

What about the folks that serve at restaurants, McDonalds, Food Courts, clean toilets at Malls, work in thousands of small businesses, pick the food we eat.......... are they "your most unproductive workers".

I am sorry if I am interpreting your post wrong but it comes across as someone who wants to maintain their gap away from the terrible low paid members of our society

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#2148747 21-Dec-2018 11:46

6FIEND:

tdgeek:

$30?? That's a bit silly :-) Some seem to feel that the increase of the really low minimum pay for the lowest income earners in NZ isn't right, its bad for businesses. I don't believe that's correct as per the points I made.

I guess that begs the question - what makes $20 overdue and "sensible" and what makes $30 silly? A decade ago, $20 would have been silly, and at some point in the future $30 will be "barely enough". What inputs need to go into the evaluation of what the appropriate amount should be?

I'm not going to argue that "it isn't right", but I can see how this move is going to increase the level of industrial action that we see in NZ over the next few years.

Minimum wage is the very least that you're allowed to pay your most unproductive workers. These workers have just been awarded a >%7 payrise for absolutely no reciprocal increase in their performance or output. (I'm not saying that it necessarily won't happen, only that it's not required in order to receive the extra income). For the remainder of the workforce, this will set a point of reference. If they (as more highly valued and remunerated employees) don't also receive similar or greater increases, they will feel less valued, and risk becoming disenfranchised. As has been alluded to earlier, the deal that the Nurses won for all their striking (and associated loss of income) now looks to be much less of a victory in the context of what has just been awarded to 210,000 kiwi workers. (who had already amassed >15% pay increases over the last 4yrs)

The pressure for middle-incomes to be lifted will be greatly increased. And naturally, this will also have an effect on upper-incomes too. This will cost businesses much more than $47/wk.

That's not right at all

You cannot compare $20 a decade ago, with minimum wage earner going to $30 now, that's not well reasoned at all

You also cannot compare a 7% increase that is actually a little over one dollar, that's just a numbers game

You also cannot compare this to nurses or teacher who have been left behind, plus they have a lack of resource issue.

If they get a little over a dollar an hour now, that wont have employees on higher rates going after the employer. Its a minimum, baseline hourly rate, no more. That's probably the least well reasoned point. Unless those on 50k, 150k, 250k, ask for another $1-20 per hour??? There would be a need to satisfy those just above minimum wage though, they are the only ones who could and should feel let down

Your points are always really well put, but I can't believe you made these comparisons

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#2148750 21-Dec-2018 11:51

MikeB4:

I am sorry if I am interpreting your post wrong but it comes across as someone who wants to maintain their gap away from the terrible low paid members of our society

He doesn't mean that. But he sees that the bottom of the ladder workers set the benchmark for everyone else, I can't see that at all. Its a baseline, not a guideline. These people often work two jobs, they have no PDI, they often have negative PDI so they forego things. Its not a compassion issue its a fairness issue. CPI is a general guideline, but if some are lower than the low, income wise, that's not entirely fair

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#2148758 21-Dec-2018 12:02

sbiddle:
Whether minimum wage increases drive inflation is one of the biggest debates in the economics world and one which doesn't have a simple answer. There is plenty of evidence however to suggest that large increases in the minimum wage such as the one NZ is looking at will cause inflationary pressures, simply because all wages need to go up as a result.

And inflation needs to increase. As it is too low

GV27

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#2148762 21-Dec-2018 12:06

attewell:
sbiddle:

Whether minimum wage increases drive inflation is one of the biggest debates in the economics world and one which doesn't have a simple answer. There is plenty of evidence however to suggest that large increases in the minimum wage such as the one NZ is looking at will cause inflationary pressures, simply because all wages need to go up as a result.

And inflation needs to increase. As it is too low

Inflation erodes purchasing power. We need sustained stable low inflation, not sudden lurches upwards. Incomes in NZ have not risen with costs of living over the last few decades, and if inflation starts to rise then there's nothing to say that incomes will as well.

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#2148766 21-Dec-2018 12:11

Aredwood:
Unfortunately it all comes back to things like high land prices .

I agree the root of problems is land prices. We have had massive house/land inflation. And this doesn’t come under mandate of RBNZ as part of inflation

Very low or very high inflation is bad

What the min wage increase does is goes towards resetting that inflation

The exchange rate also floats. Which should counteract the increase in wages for imports or exports

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#2148768 21-Dec-2018 12:13

GV27:
attewell:
sbiddle:

Whether minimum wage increases drive inflation is one of the biggest debates in the economics world and one which doesn't have a simple answer. There is plenty of evidence however to suggest that large increases in the minimum wage such as the one NZ is looking at will cause inflationary pressures, simply because all wages need to go up as a result.

And inflation needs to increase. As it is too low

Inflation erodes purchasing power. We need sustained stable low inflation, not sudden lurches upwards. Incomes in NZ have not risen with costs of living over the last few decades, and if inflation starts to rise then there's nothing to say that incomes will as well.

Agree we don’t want inflation to high. But should be be too low either
And we just had that with land prices. Inflation that was too high

tdgeek

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#2148774 21-Dec-2018 12:21

attewell:

What the min wage increase does is goes towards resetting that inflation

I'd suggest that the puny dollar minimum wage increase that will be added to the economy in terms of extra costs is far outweighed by the much higher numbers of higher paid earners recieving their annual review.

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#2148783 21-Dec-2018 12:34

tdgeek:
attewell:

What the min wage increase does is goes towards resetting that inflation

I'd suggest that the puny dollar minimum wage increase that will be added to the economy in terms of extra costs is far outweighed by the much higher numbers of higher paid earners recieving their annual review.

And I think we can bear those costs. We need to close the gap between low & high earners. There shouldnt be such a wide gap..

An society with such wide gaps and disadvantaged contribute to crime and home violence and parents who need to work 60 hours a week to care for family. How can a person working 60 hours be there for children

Some only think of themselves. Those people would probably also like to see the min wage decreased

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#2148785 21-Dec-2018 12:36

tdgeek:

attewell:

What the min wage increase does is goes towards resetting that inflation

I'd suggest that the puny dollar minimum wage increase that will be added to the economy in terms of extra costs is far outweighed by the much higher numbers of higher paid earners recieving their annual review.

Having an annual review is not the same as getting a pay rise.

tdgeek

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#2148807 21-Dec-2018 12:58

GV27:

tdgeek:

attewell:

What the min wage increase does is goes towards resetting that inflation

I'd suggest that the puny dollar minimum wage increase that will be added to the economy in terms of extra costs is far outweighed by the much higher numbers of higher paid earners recieving their annual review.

Having an annual review is not the same as getting a pay rise.

Ok, I meant annual review that means a pay rise, which I outlined further back what that can mean

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