Minimum Wage

I’m sorry if this hard to follow it was more rant filled than usual.

So I promised my thoughts on the minimum wage increase in a previous post and alluded to my feelings. Now unfortunately I have taken a few labor economic classes but I really have no major in depth schooling so people may disagree with me (Leon). So here is my disclaimer:
:: Megan might not always be 100% right, but she should be ::

Basically I complained about the ticket prices increasing but I know why, Granhom’s wonderful minimum wage increase. The theaters have to pay their employees more (and they still make crap) and when labor cost goes up the company has to recoup those losses by raising the cost of their product. ie: ticket and food prices. These increases could be avoided if the company can get rid of internal overhead but I can’t imagine there is much overhead in a theater. Turning of lights or heat down isn’t going to save enough to offset the new labor cost. If you’ve been paying attention there have also been increases at McDonalds, Taco Bell and many other local favorites.

But Granholm raised the minimum wage so that’s good right? Well maybe if you make minimum wage, but not for those people with salaried positions or those making a significant amount higher than the new wage. An example from my own life. While working for the State I made 11.50ish in September. When the minimum wage went up in October Granholm didn’t raise the student assistant’s page or salaries employees pay per hour. Think about it did you get a dollar plus raise in October? Probably not and if you did you are one lucky employee (unless you were making minimum wage to begin with). So what does this mean for us? We actually lost purchasing power in this deal meaning in a way we lost money. We still make X amount of dollars but the cost of foods and other products have increased which takes more of our X dollars to pay for it. So we can buy les with our salaries than we could before the raise hence lower purchasing power  less stuff for us. It really helps me sleep though to know that Granholm helped a bunch of high school kids who still live at home have more flexible in their spending money. Which they can buy CD’s and other useless crap with. Oh maybe even drugs. It’s a fact that most workers who make minimum wage are high schoolers, but those working families who are earning minimum wage are still fucked. They are earning 90 cents more an hour which is roughly $144 more a month. Yet, food has increased 50 dollars a month plus all those other things gas, oil changes, child care cost, movies, clothes all these things local to Michigan increased. Taking more of that extra money each month and therefore leaving the person monetarily exactly where they were before the increase or even further behind. . But I guess they think they are earning more so they feel better about themselves right? Even if they still can’t buy their meds…Thank You Governor Granholm.

Where did the economist working for her go to school, U of M? If you just think about the basic relationships between jobs and wages. Its basic labor/union principles. If you have to pay your employees more you can’t afford to have as many employees as before. It’s been a while but I believe for every 30 cent increase in wages per hour its generally a 5 o 10% lay off of the labor force. So if companies have to increase wages and can’t or won’t increase their product cost they ultimately may lay off some of their work force. So I leave you with this question:
Would a person who’s just been laid off and now making zero dollars an hour want Granholm’s increase or would they prefer the wage they were making before?