When working a 68-hour week still doesn't cut it

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#902868 26-Sep-2013 09:00

surfisup1000:
freitasm: Folks talking about WCC and parking wardens forget those are actually employee of a private company providing a service to the council so I don't understand your views that the council is doing something wrong in terms of pay (besides using parking as a money making scheme).

It can be argued that the council has some responsibility for suppliers employees.

Just in the way that Apple requires Chinese companies building iphones to provide decent working conditions to their employee.

if the WCC morally believes in a living wage then they are obliged to ensure companies who win council contracts to provide a living wage.... otherwise WCC would be guilty of contracting out of their morals.

This is an accepted concept elsewhere.

For example in the UK, contractors are usually expected to conform to things such as their employer's Health & Safety Policy. This may be part of the reason why NZ has 6 times the number of workplace deaths the UK does..!

Well, that and the fact that the UK H&S Executive have very sharp teeth and prosecute mercilessly, with massive fines and/or prison terms...! (A UK farmer was once fined the equivalent of $30,000 for cutting his own arm off in a piece of agricultural machinery because the statutorily required guards were missing!)

So expecting companies 'acting as employees' to follow company policy is quite normal.

MaxLV

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#902882 26-Sep-2013 09:16

Inphinity:
MaxLV:

The minimum wage (it's what we're talking about here) is not a market set wage. They Government set's it.
And yes I do believe working New Zealanders should get a living wage of at least $18.40 p/h. And employers should be paying it, not the government through things like WFF, Work start, etc. Why dont you?

What you think about low paid workers getting a living wage of $18.40 P/h has been obvious from the start. Why you think that way is for you to explain and justify, not me.

It's not as simple as "Just up the minimum wage and she'll be right!", though. You want a ~34% increase to the minimum wage? Are you happy with the accompanying reduction in minimum-wage positions, and the impact on the portion of people who were in between the previous minimum and the new minimum, most of whom will get no relative increase, and thus will now be minimum wage (and, as such, worse off then previous relative to the labour market)? What about the increase in prices that will occur because of the increased costs to employers? How about those on an unemployment or other benefit, do they get an equivalent increase? How many people will end up worse off, because their employer had to lay 10% of their minimum-wage staff off due to the cost increase, and those people are now on a benefit that pays them less than they got when they were working for the old minimum?

Heck, if it was as simple as "set the minimum wage and there'll be negative impacts", I'd love to see it happen. But, especially with such a large proportionate jump, there are a LOT of factors to consider, and quite honestly I'm not convinced that many of the people supporting this figure have taken them in to account.

So just because an employer decides a job suddenly costs too much, they sack the employees rather than pay them and the work the employees were doing just goes away? Who's going to do the work of the employees that have been sacked because they were too expensive to employ... Who is going to do the work that makes the employer their profits when they have sacked all their 'expensive' employees.

The employer still wants/needs someone to do the work, only as long as it's done at minimum cost to the profit margin. If you're a company owner/employer, and claim you're running the company on razor thin, make or break profit margins, then you're either telling porkies to hide your real profits from the tax man, or your business plan is wrong/is not working, and/or you cant run a business properly.

We hear this excuse from employers all the time when they dont want to cut their profit margins just to pay their workers a reasonable living wage. That and the BS claims that they run their businesses on razor thin margins, yet always claim they're making a 'good profit' to the annual shareholders meeting.

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#902891 26-Sep-2013 09:23

MaxLV:
Inphinity:
MaxLV:

The minimum wage (it's what we're talking about here) is not a market set wage. They Government set's it.
And yes I do believe working New Zealanders should get a living wage of at least $18.40 p/h. And employers should be paying it, not the government through things like WFF, Work start, etc. Why dont you?

What you think about low paid workers getting a living wage of $18.40 P/h has been obvious from the start. Why you think that way is for you to explain and justify, not me.

It's not as simple as "Just up the minimum wage and she'll be right!", though. You want a ~34% increase to the minimum wage? Are you happy with the accompanying reduction in minimum-wage positions, and the impact on the portion of people who were in between the previous minimum and the new minimum, most of whom will get no relative increase, and thus will now be minimum wage (and, as such, worse off then previous relative to the labour market)? What about the increase in prices that will occur because of the increased costs to employers? How about those on an unemployment or other benefit, do they get an equivalent increase? How many people will end up worse off, because their employer had to lay 10% of their minimum-wage staff off due to the cost increase, and those people are now on a benefit that pays them less than they got when they were working for the old minimum?

Heck, if it was as simple as "set the minimum wage and there'll be negative impacts", I'd love to see it happen. But, especially with such a large proportionate jump, there are a LOT of factors to consider, and quite honestly I'm not convinced that many of the people supporting this figure have taken them in to account.

So just because an employer decides a job suddenly costs too much, they sack the employees rather than pay them and the work the employees were doing just goes away? Who's going to do the work of the employees that have been sacked because they were too expensive to employ... Who is going to do the work that makes the employer their profits when they have sacked all their 'expensive' employees.

The employer still wants/needs someone to do the work, only as long as it's done at minimum cost to the profit margin. If you're a company owner/employer, and claim you're running the company on razor thin, make or break profit margins, then you're either telling porkies to hide your real profits from the tax man, or your business plan is wrong/is not working, and/or you cant run a business properly.

We hear this excuse from employers all the time when they dont want to cut their profit margins just to pay their workers a reasonable living wage. That and the BS claims that they run their businesses on razor thin margins, yet always claim they're making a 'good profit' to the annual shareholders meeting.

It is easy to say profits are easily earned, it is considerably harder to do it in reality. Most NZ SMB's exist on very tight margins. Just like most home budgets are not bottomless neither are most business budgets.

The key is not Government funded living wages but better funded education so we have a higher skilled workforce and considerably more venture capital. This is the way to a higher income populous not artificial elastoplast fixes.

Geektastic

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#902893 26-Sep-2013 09:27

MaxLV:
Inphinity:
MaxLV:

The minimum wage (it's what we're talking about here) is not a market set wage. They Government set's it.
And yes I do believe working New Zealanders should get a living wage of at least $18.40 p/h. And employers should be paying it, not the government through things like WFF, Work start, etc. Why dont you?

What you think about low paid workers getting a living wage of $18.40 P/h has been obvious from the start. Why you think that way is for you to explain and justify, not me.

It's not as simple as "Just up the minimum wage and she'll be right!", though. You want a ~34% increase to the minimum wage? Are you happy with the accompanying reduction in minimum-wage positions, and the impact on the portion of people who were in between the previous minimum and the new minimum, most of whom will get no relative increase, and thus will now be minimum wage (and, as such, worse off then previous relative to the labour market)? What about the increase in prices that will occur because of the increased costs to employers? How about those on an unemployment or other benefit, do they get an equivalent increase? How many people will end up worse off, because their employer had to lay 10% of their minimum-wage staff off due to the cost increase, and those people are now on a benefit that pays them less than they got when they were working for the old minimum?

Heck, if it was as simple as "set the minimum wage and there'll be negative impacts", I'd love to see it happen. But, especially with such a large proportionate jump, there are a LOT of factors to consider, and quite honestly I'm not convinced that many of the people supporting this figure have taken them in to account.

So just because an employer decides a job suddenly costs too much, they sack the employees rather than pay them and the work the employees were doing just goes away? Who's going to do the work of the employees that have been sacked because they were too expensive to employ... Who is going to do the work that makes the employer their profits when they have sacked all their 'expensive' employees.

The employer still wants/needs someone to do the work, only as long as it's done at minimum cost to the profit margin. If you're a company owner/employer, and claim you're running the company on razor thin, make or break profit margins, then you're either telling porkies to hide your real profits from the tax man, or your business plan is wrong/is not working, and/or you cant run a business properly.

We hear this excuse from employers all the time when they dont want to cut their profit margins just to pay their workers a reasonable living wage. That and the BS claims that they run their businesses on razor thin margins, yet always claim they're making a 'good profit' to the annual shareholders meeting.

The first reaction will be to make the existing employees work more hours and work more productively in those hours. Reports in today's papers confirm the blindingly obvious fact that NZ is 20% less productive than the OECD average.

The next reactions will be to seek a bigger market and have a debate as to whether customers will bear any price increase. There will be some price elasticity of demand but it will be limited.

Once there are no more available customers and any price elasticity has been used up, the employer either keeps prices down by increasing efficiency or reducing profit, or he decides it is all too hard and packs it in and all the employees visit WINZ.

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#902935 26-Sep-2013 10:48

not accepting that you can't live on a $900/w wage is fine

judging someone when you haven't walked in their shoes is lame

Klipspringer

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#902936 26-Sep-2013 10:53

To those that seem to have taken offense to this thread.. Point taken, I have had a good think about it and I have to say I agree, Its not really related to geekzone and I will refrain from posting threads like this in the future.

My gripe with this one was that I deemed it very unfair that people like me subsidise this kind of lifestyle. The article to me was clearly a joke and there is no ways this guy is living so close to the so called “poverty line”. But at the end of the day, its just my opinion, it was not meant to upset anyone, nor was it intended to judge.

I’m a capitalist, and I have my own views about socialism which I will try and keep out of geekzone in the future. Again, my apologies if my posts of late have upset anyone. Agreed, there are better places to have these type of conversations. Geekzone is not the place. In future I will try and stick to technology discussions. And try and not jump into these kinds of discussions again…

To the mods, you have indicated that you happy to let these kind of discussions continue. Maybe some advice then, move the “off topic” forum to the bottom of the page. And maybe move these threads out of the live stream? Currently when logging onto the geekzone forums, the “Off topic” thread seems to be right near the top, above everything else (geekzone related)

Cheers guys… See you in the technology forums…Apologies again.

Geektastic

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#902940 26-Sep-2013 10:56

Klipspringer: To those that seem to have taken offense to this thread.. Point taken, I have had a good think about it and I have to say I agree, Its not really related to geekzone and I will refrain from posting threads like this in the future.

My gripe with this one was that I deemed it very unfair that people like me subsidise this kind of lifestyle. The article to me was clearly a joke and there is no ways this guy is living so close to the so called “poverty line”. But at the end of the day, its just my opinion, it was not meant to upset anyone, nor was it intended to judge.

I’m a capitalist, and I have my own views about socialism which I will try and keep out of geekzone in the future. Again, my apologies if my posts of late have upset anyone. Agreed, there are better places to have these type of conversations. Geekzone is not the place. In future I will try and stick to technology discussions. And try and not jump into these kind of discussions again…

To the mods, you have indicated that you happy to let these kind of discussions continue. Maybe some advice then, move the “off topic” forum to the bottom of the page. And maybe move these threads out of the live stream? Currently when logging onto the geekzone forums, the “Off topic” thread seems to be right near the top, above everything else (geekzone related)

Cheers guys… See you in the technology forums…

Meh. Off Topic is off topic - I see no reason why it need relate to tech. Mauricio has said he does not find it in contravention of the rules and since he is BDL, that ends that particular concern for me.

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MaxLV

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#902968 26-Sep-2013 11:20

KiwiNZ:
MaxLV:
Inphinity:
MaxLV:

The minimum wage (it's what we're talking about here) is not a market set wage. They Government set's it.
And yes I do believe working New Zealanders should get a living wage of at least $18.40 p/h. And employers should be paying it, not the government through things like WFF, Work start, etc. Why dont you?

What you think about low paid workers getting a living wage of $18.40 P/h has been obvious from the start. Why you think that way is for you to explain and justify, not me.

It's not as simple as "Just up the minimum wage and she'll be right!", though. You want a ~34% increase to the minimum wage? Are you happy with the accompanying reduction in minimum-wage positions, and the impact on the portion of people who were in between the previous minimum and the new minimum, most of whom will get no relative increase, and thus will now be minimum wage (and, as such, worse off then previous relative to the labour market)? What about the increase in prices that will occur because of the increased costs to employers? How about those on an unemployment or other benefit, do they get an equivalent increase? How many people will end up worse off, because their employer had to lay 10% of their minimum-wage staff off due to the cost increase, and those people are now on a benefit that pays them less than they got when they were working for the old minimum?

Heck, if it was as simple as "set the minimum wage and there'll be negative impacts", I'd love to see it happen. But, especially with such a large proportionate jump, there are a LOT of factors to consider, and quite honestly I'm not convinced that many of the people supporting this figure have taken them in to account.

So just because an employer decides a job suddenly costs too much, they sack the employees rather than pay them and the work the employees were doing just goes away? Who's going to do the work of the employees that have been sacked because they were too expensive to employ... Who is going to do the work that makes the employer their profits when they have sacked all their 'expensive' employees.

The employer still wants/needs someone to do the work, only as long as it's done at minimum cost to the profit margin. If you're a company owner/employer, and claim you're running the company on razor thin, make or break profit margins, then you're either telling porkies to hide your real profits from the tax man, or your business plan is wrong/is not working, and/or you cant run a business properly.

We hear this excuse from employers all the time when they dont want to cut their profit margins just to pay their workers a reasonable living wage. That and the BS claims that they run their businesses on razor thin margins, yet always claim they're making a 'good profit' to the annual shareholders meeting.

It is easy to say profits are easily earned, it is considerably harder to do it in reality. Most NZ SMB's exist on very tight margins. Just like most home budgets are not bottomless neither are most business budgets.

The key is not Government funded living wages but better funded education so we have a higher skilled workforce and considerably more venture capital. This is the way to a higher income populous not artificial elastoplast fixes.

Most (all?) employers, no matter how big or small, obviously have enough profit coming out of the business to afford the material 'must haves' and lifestyles that makes a 'lie' of any claims they make about running the business on 'razor thin' profit margins and cant afford to pay their employees a 'living wage'.

The $$ figure on an annual report is not the only measure of how profitable a business is.

OK, so everyone gets educated. Who's going to do all the jobs that dont require a 'skilled' workforce and 'education'. And again it's the government (Tax payer) that has to subsidise the employers need for 'educated' skilled workers. Employers want a skilled workforce with the education to match? Then THEY should be paying for that skilled workforce and required education, NOT the taxpayers.

MikeB4

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#902984 26-Sep-2013 11:26

MaxLV:
KiwiNZ:
MaxLV:
Inphinity:
MaxLV:

The minimum wage (it's what we're talking about here) is not a market set wage. They Government set's it.
And yes I do believe working New Zealanders should get a living wage of at least $18.40 p/h. And employers should be paying it, not the government through things like WFF, Work start, etc. Why dont you?

What you think about low paid workers getting a living wage of $18.40 P/h has been obvious from the start. Why you think that way is for you to explain and justify, not me.

It's not as simple as "Just up the minimum wage and she'll be right!", though. You want a ~34% increase to the minimum wage? Are you happy with the accompanying reduction in minimum-wage positions, and the impact on the portion of people who were in between the previous minimum and the new minimum, most of whom will get no relative increase, and thus will now be minimum wage (and, as such, worse off then previous relative to the labour market)? What about the increase in prices that will occur because of the increased costs to employers? How about those on an unemployment or other benefit, do they get an equivalent increase? How many people will end up worse off, because their employer had to lay 10% of their minimum-wage staff off due to the cost increase, and those people are now on a benefit that pays them less than they got when they were working for the old minimum?

Heck, if it was as simple as "set the minimum wage and there'll be negative impacts", I'd love to see it happen. But, especially with such a large proportionate jump, there are a LOT of factors to consider, and quite honestly I'm not convinced that many of the people supporting this figure have taken them in to account.

So just because an employer decides a job suddenly costs too much, they sack the employees rather than pay them and the work the employees were doing just goes away? Who's going to do the work of the employees that have been sacked because they were too expensive to employ... Who is going to do the work that makes the employer their profits when they have sacked all their 'expensive' employees.

The employer still wants/needs someone to do the work, only as long as it's done at minimum cost to the profit margin. If you're a company owner/employer, and claim you're running the company on razor thin, make or break profit margins, then you're either telling porkies to hide your real profits from the tax man, or your business plan is wrong/is not working, and/or you cant run a business properly.

We hear this excuse from employers all the time when they dont want to cut their profit margins just to pay their workers a reasonable living wage. That and the BS claims that they run their businesses on razor thin margins, yet always claim they're making a 'good profit' to the annual shareholders meeting.

It is easy to say profits are easily earned, it is considerably harder to do it in reality. Most NZ SMB's exist on very tight margins. Just like most home budgets are not bottomless neither are most business budgets.

The key is not Government funded living wages but better funded education so we have a higher skilled workforce and considerably more venture capital. This is the way to a higher income populous not artificial elastoplast fixes.

Most (all?) employers, no matter how big or small, obviously have enough profit coming out of the business to afford the material 'must haves' and lifestyles that makes a 'lie' of any claims they make about running the business on 'razor thin' profit margins and cant afford to pay their employees a 'living wage'.

The $$ figure on an annual report is not the only measure of how profitable a business is.

OK, so everyone gets educated. Who's going to do all the jobs that dont require a 'skilled' workforce and 'education'. And again it's the government (Tax payer) that has to subsidise the employers need for 'educated' skilled workers. Employers want a skilled workforce with the education to match? Then THEY should be paying for that skilled workforce and required education, NOT the taxpayers.

I am sorry where do you get the notion that most company's make good profits, given that that most startups fail with in the first two years and the number of liquidations would beg to differ with you.

My second point, there will always be those on low pay and there will and should be a level of support for them, however by raising education levels and providing venture capital the odds of more people people gaining higher levels of income impproves
without adding inflationary pressures.

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#902986 26-Sep-2013 11:28

MaxLV:
KiwiNZ:
MaxLV:
Inphinity:
MaxLV:

The minimum wage (it's what we're talking about here) is not a market set wage. They Government set's it.
And yes I do believe working New Zealanders should get a living wage of at least $18.40 p/h. And employers should be paying it, not the government through things like WFF, Work start, etc. Why dont you?

What you think about low paid workers getting a living wage of $18.40 P/h has been obvious from the start. Why you think that way is for you to explain and justify, not me.

It's not as simple as "Just up the minimum wage and she'll be right!", though. You want a ~34% increase to the minimum wage? Are you happy with the accompanying reduction in minimum-wage positions, and the impact on the portion of people who were in between the previous minimum and the new minimum, most of whom will get no relative increase, and thus will now be minimum wage (and, as such, worse off then previous relative to the labour market)? What about the increase in prices that will occur because of the increased costs to employers? How about those on an unemployment or other benefit, do they get an equivalent increase? How many people will end up worse off, because their employer had to lay 10% of their minimum-wage staff off due to the cost increase, and those people are now on a benefit that pays them less than they got when they were working for the old minimum?

Heck, if it was as simple as "set the minimum wage and there'll be negative impacts", I'd love to see it happen. But, especially with such a large proportionate jump, there are a LOT of factors to consider, and quite honestly I'm not convinced that many of the people supporting this figure have taken them in to account.

So just because an employer decides a job suddenly costs too much, they sack the employees rather than pay them and the work the employees were doing just goes away? Who's going to do the work of the employees that have been sacked because they were too expensive to employ... Who is going to do the work that makes the employer their profits when they have sacked all their 'expensive' employees.

The employer still wants/needs someone to do the work, only as long as it's done at minimum cost to the profit margin. If you're a company owner/employer, and claim you're running the company on razor thin, make or break profit margins, then you're either telling porkies to hide your real profits from the tax man, or your business plan is wrong/is not working, and/or you cant run a business properly.

We hear this excuse from employers all the time when they dont want to cut their profit margins just to pay their workers a reasonable living wage. That and the BS claims that they run their businesses on razor thin margins, yet always claim they're making a 'good profit' to the annual shareholders meeting.

It is easy to say profits are easily earned, it is considerably harder to do it in reality. Most NZ SMB's exist on very tight margins. Just like most home budgets are not bottomless neither are most business budgets.

The key is not Government funded living wages but better funded education so we have a higher skilled workforce and considerably more venture capital. This is the way to a higher income populous not artificial elastoplast fixes.

Most (all?) employers, no matter how big or small, obviously have enough profit coming out of the business to afford the material 'must haves' and lifestyles that makes a 'lie' of any claims they make about running the business on 'razor thin' profit margins and cant afford to pay their employees a 'living wage'.

The $$ figure on an annual report is not the only measure of how profitable a business is.

OK, so everyone gets educated. Who's going to do all the jobs that dont require a 'skilled' workforce and 'education'. And again it's the government (Tax payer) that has to subsidise the employers need for 'educated' skilled workers. Employers want a skilled workforce with the education to match? Then THEY should be paying for that skilled workforce and required education, NOT the taxpayers.

Bluntly it is for the owner of the business, whose capital is at risk, to decide just how much money is right for him. It is not up to the government to dictate such matters.

Businesses pay taxes like everything else in NZ so they are making a perfectly reasonable contribution to the cost of their operating environment.

If it is all so easy, why aren't you out there doing it?

Inphinity

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#903000 26-Sep-2013 11:45

MaxLV:
Most (all?) employers, no matter how big or small, obviously have enough profit coming out of the business to afford the material 'must haves' and lifestyles that makes a 'lie' of any claims they make about running the business on 'razor thin' profit margins and cant afford to pay their employees a 'living wage'.

The $$ figure on an annual report is not the only measure of how profitable a business is.

So which business is it again that you run that employs 100 people and returns you just equivalent of the minimum wage?

Kopkiwi

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#903003 26-Sep-2013 11:52

MaxLV:
Inphinity:
MaxLV:

The minimum wage (it's what we're talking about here) is not a market set wage. They Government set's it.
And yes I do believe working New Zealanders should get a living wage of at least $18.40 p/h. And employers should be paying it, not the government through things like WFF, Work start, etc. Why dont you?

What you think about low paid workers getting a living wage of $18.40 P/h has been obvious from the start. Why you think that way is for you to explain and justify, not me.

It's not as simple as "Just up the minimum wage and she'll be right!", though. You want a ~34% increase to the minimum wage? Are you happy with the accompanying reduction in minimum-wage positions, and the impact on the portion of people who were in between the previous minimum and the new minimum, most of whom will get no relative increase, and thus will now be minimum wage (and, as such, worse off then previous relative to the labour market)? What about the increase in prices that will occur because of the increased costs to employers? How about those on an unemployment or other benefit, do they get an equivalent increase? How many people will end up worse off, because their employer had to lay 10% of their minimum-wage staff off due to the cost increase, and those people are now on a benefit that pays them less than they got when they were working for the old minimum?

Heck, if it was as simple as "set the minimum wage and there'll be negative impacts", I'd love to see it happen. But, especially with such a large proportionate jump, there are a LOT of factors to consider, and quite honestly I'm not convinced that many of the people supporting this figure have taken them in to account.

So just because an employer decides a job suddenly costs too much, they sack the employees rather than pay them and the work the employees were doing just goes away? Who's going to do the work of the employees that have been sacked because they were too expensive to employ... Who is going to do the work that makes the employer their profits when they have sacked all their 'expensive' employees.

The employer still wants/needs someone to do the work, only as long as it's done at minimum cost to the profit margin. If you're a company owner/employer, and claim you're running the company on razor thin, make or break profit margins, then you're either telling porkies to hide your real profits from the tax man, or your business plan is wrong/is not working, and/or you cant run a business properly.

We hear this excuse from employers all the time when they dont want to cut their profit margins just to pay their workers a reasonable living wage. That and the BS claims that they run their businesses on razor thin margins, yet always claim they're making a 'good profit' to the annual shareholders meeting.

The more I read of your posts, the more I begin to realize you understand very little about this.

wasabi2k

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#903011 26-Sep-2013 12:00

You do understand a lot of businesses make losses over a year? A lot end up in debt and liquidate?

Not too sure what you are arguing here.

Some businesses make piles of money and don't pay well.
Some businesses lost money but still manage to pay staff (then go under)
Some businesses barely break even.

And everything in between.

minimoke

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#903150 26-Sep-2013 15:35

MaxLV:
Most (all?) employers, no matter how big or small, obviously have enough profit coming out of the business to afford the material 'must haves' and lifestyles that makes a 'lie' of any claims they make about running the business on 'razor thin' profit margins and cant afford to pay their employees a 'living wage'.

The $$ figure on an annual report is not the only measure of how profitable a business is.

OK, so everyone gets educated. Who's going to do all the jobs that dont require a 'skilled' workforce and 'education'. And again it's the government (Tax payer) that has to subsidise the employers need for 'educated' skilled workers. Employers want a skilled workforce with the education to match? Then THEY should be paying for that skilled workforce and required education, NOT the taxpayers.

How do we put this simply Max LV

Say I have $1m to invest. I can, say, stick it in the bank and make 5% or $50,000 a year pretty much risk free.

If I want to invest it in business I have to get $50,000 out of the business to make it worth my while. I actually have to get more than that because I also want something to cover the risk of me losing my $1m. Lets say $108,000 is a number that does it for me.

You’ll probably accuse me of being a filthy capitalist pig for having a $1m so say I borrow $1m from the bank. That will cost me say $100,000 a year just to service the interest cost.

Lets say I sell boxes and I can sell 400 boxes a week. My customers will buy New Zealand made for $80 a box so I make $1,664,000. Or they could get Chinese made for $75 a box or perhaps order off the internet and get it for $70 a box.

It takes my 10 employee’s 1 hour each to make a box. I pay each of them $15 an hour so my labour costs are $312,000. My bank interest costs $100,000. My local supplied raw materials cost $15 a box or $312,000. My electricity, building rent etc costs $15 a box or $312,000. My advertising and selling cost $15 a box or $312,000. My freight and logistics costs $1 a box or $208,000. After all my overheads are accounted for I’m left with $0.52 a box. I get to take home 6.5% of my sales or $108,000 per annum. It’s a filthy capitalist world I know but thems the breaks. I’ll get to put some gas in the Hummer this week!

So lets say I am forced to increase my hourly rate to $18.40. I’ve got to find $3.40 a box or $707,000 from somewhere. I can’t take it from the bank. So what am I left with.

Lets say I can screw $1 a box in raw materials off my supplier. He’s also making 6.5% “profit”. Rather than $0.937 profit he’s now making a $0.063 loss. Lets do the same for my land lord. And electricity. There’s another $1 saved but their profit margins now mean their business is not very viable. I can shave another $1 off my advertising – but my message no longer hits my market so next year demand is only 350 a week. I’ll hit my freight and logistics up for a 20% reduction so there’s another $0.20 saved. I’ve only got $41,600 left to find or $0.2 a box.

Here’s a thought. I’ll take $41,600 out of my pay. I’m now left with $66,400 a year or 4% of my sales go into my pocket. Oh dear, I’m left with just cake to eat!

Now you are happy – your workers are getting there $18.40 an hour. But what are we left with.

So I’ve taken a 38% drop in pay and I’ve worked harder this year stitching up these deals.

Your workers have done nothing at all extra and their pay has gone up over 22%.

My raw material supplier is no longer profitable and about to go out of business.

My landlord is about to sell his building because there isn’t enough money in it for him.

I’ve got the prospect of reduced sales next year.

But that’s OK, because I’ll lay 3 or 4 guys off so they will end up on the dole or on $14.40 an hour.

An alternative is that I could put my prices up $3.40 a box – and then I’ll loose all my custom to the Chinese or Amazon. Then I won’t have to worry about this Living Wage nonsense as I won’t have any employees to worry about.

MikeB4

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#903161 26-Sep-2013 15:52

minimoke:
MaxLV:
Most (all?) employers, no matter how big or small, obviously have enough profit coming out of the business to afford the material 'must haves' and lifestyles that makes a 'lie' of any claims they make about running the business on 'razor thin' profit margins and cant afford to pay their employees a 'living wage'.

The $$ figure on an annual report is not the only measure of how profitable a business is.

OK, so everyone gets educated. Who's going to do all the jobs that dont require a 'skilled' workforce and 'education'. And again it's the government (Tax payer) that has to subsidise the employers need for 'educated' skilled workers. Employers want a skilled workforce with the education to match? Then THEY should be paying for that skilled workforce and required education, NOT the taxpayers.

How do we put this simply Max LV

Say I have $1m to invest. I can, say, stick it in the bank and make 5% or $50,000 a year pretty much risk free.

If I want to invest it in business I have to get $50,000 out of the business to make it worth my while. I actually have to get more than that because I also want something to cover the risk of me losing my $1m. Lets say $108,000 is a number that does it for me.

You’ll probably accuse me of being a filthy capitalist pig for having a $1m so say I borrow $1m from the bank. That will cost me say $100,000 a year just to service the interest cost.

Lets say I sell boxes and I can sell 400 boxes a week. My customers will buy New Zealand made for $80 a box so I make $1,664,000. Or they could get Chinese made for $75 a box or perhaps order off the internet and get it for $70 a box.

It takes my 10 employee’s 1 hour each to make a box. I pay each of them $15 an hour so my labour costs are $312,000. My bank interest costs $100,000. My local supplied raw materials cost $15 a box or $312,000. My electricity, building rent etc costs $15 a box or $312,000. My advertising and selling cost $15 a box or $312,000. My freight and logistics costs $1 a box or $208,000. After all my overheads are accounted for I’m left with $0.52 a box. I get to take home 6.5% of my sales or $108,000 per annum. It’s a filthy capitalist world I know but thems the breaks. I’ll get to put some gas in the Hummer this week!

So lets say I am forced to increase my hourly rate to $18.40. I’ve got to find $3.40 a box or $707,000 from somewhere. I can’t take it from the bank. So what am I left with.

Lets say I can screw $1 a box in raw materials off my supplier. He’s also making 6.5% “profit”. Rather than $0.937 profit he’s now making a $0.063 loss. Lets do the same for my land lord. And electricity. There’s another $1 saved but their profit margins now mean their business is not very viable. I can shave another $1 off my advertising – but my message no longer hits my market so next year demand is only 350 a week. I’ll hit my freight and logistics up for a 20% reduction so there’s another $0.20 saved. I’ve only got $41,600 left to find or $0.2 a box.

Here’s a thought. I’ll take $41,600 out of my pay. I’m now left with $66,400 a year or 4% of my sales go into my pocket. Oh dear, I’m left with just cake to eat!

Now you are happy – your workers are getting there $18.40 an hour. But what are we left with.

So I’ve taken a 38% drop in pay and I’ve worked harder this year stitching up these deals.

Your workers have done nothing at all extra and their pay has gone up over 22%.

My raw material supplier is no longer profitable and about to go out of business.

My landlord is about to sell his building because there isn’t enough money in it for him.

I’ve got the prospect of reduced sales next year.

But that’s OK, because I’ll lay 3 or 4 guys off so they will end up on the dole or on $14.40 an hour.

An alternative is that I could put my prices up $3.40 a box – and then I’ll loose all my custom to the Chinese or Amazon. Then I won’t have to worry about this Living Wage nonsense as I won’t have any employees to worry about.

I have always been of the belief that to be self employed one should earn as a minimum three times that which you would earn working for someone or it is just not worth the worry, loss of family time and fiscal risk. That three times should be five times to add in twice what you would earn with
your capital in the bank.

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