Minimum wage laws, currently the latest debate in Washington, DC to distract everyone from the horrors of Obamacare, interfere with free market concepts and activities. The one size fits all approach to meddling in the private enterprise disrupts the free flow of capital. Without perspective, the mandate will negatively impact not just the employers who must pay the new wage, but also the potential employees and others already employed.
The current minimum pay rate is a little over seven dollars an hour. When it went to this rate, the unemployment rate went up just a bit which tells you what this type of governmental interference does to free markets. Some of the states, themselves, have gone to a larger base rate than that. The federal government wants to go to more than 10 dollars an hour.
The problem with a one size fits all approach to a pay scale that affects less than four percent of the population is that one size rarely fits all in the first place. When an employers payroll expense, the largest part of their expenses, is arbitrarily increased, something else has to give way. This is usually accomplished by not hiring as many people or lowering other perks for those already employed.
Raising any expenses, as would have to happen in all of the payroll expense based tax payments, impact the companies abilities to be as flexible as they need to be in this economy. The main troubles with these laws are that the individuals who promote these do not, themselves, have payrolls they are responsible for. They believe that companies simply have large amounts of money, such as their slush funds, to dip into.
Free markets allow new entrants into the work force to start at the bottom of the earning curve and grow in value as they learn and gain experience. They do not have the experience, just starting out and are not worth the new wages set by the Federal master minds. Employers, faced with this new rate will favor older, more experienced workers, all but eliminating opportunities for teenagers starting out.
Making the new employees work with the newer rate will discriminate against the senior employees. This will cause raises from the new persons supervisor through the rest of the vertical organization to eliminate employee morale problems. This creates a problem for future plans as monies will have to be allocated for all of the extra expenses associated with payroll to be held onto.
A very large concern about any new minimum wage mandate is that there is no automatic increase in production as a free market will require for the extra costs. The vast majority of minimum pay personnel starts there and rarely stays there. They gain experience and additional training and move up the ladder. If they can accept additional duties and responsibilities, they are given raises. If they are not able to become more valuable, they are let go.
The largest issue with the Federal mandates that deal with raising starting pay does not discuss, openly, who it does benefit. Union contracts dealing with pay are based on certain factors of the minimum wage. Raising this starting point for the very small number of people who earn this rate gives the unions fuel for contract renegotiation with other companies.
The current minimum pay rate is a little over seven dollars an hour. When it went to this rate, the unemployment rate went up just a bit which tells you what this type of governmental interference does to free markets. Some of the states, themselves, have gone to a larger base rate than that. The federal government wants to go to more than 10 dollars an hour.
The problem with a one size fits all approach to a pay scale that affects less than four percent of the population is that one size rarely fits all in the first place. When an employers payroll expense, the largest part of their expenses, is arbitrarily increased, something else has to give way. This is usually accomplished by not hiring as many people or lowering other perks for those already employed.
Raising any expenses, as would have to happen in all of the payroll expense based tax payments, impact the companies abilities to be as flexible as they need to be in this economy. The main troubles with these laws are that the individuals who promote these do not, themselves, have payrolls they are responsible for. They believe that companies simply have large amounts of money, such as their slush funds, to dip into.
Free markets allow new entrants into the work force to start at the bottom of the earning curve and grow in value as they learn and gain experience. They do not have the experience, just starting out and are not worth the new wages set by the Federal master minds. Employers, faced with this new rate will favor older, more experienced workers, all but eliminating opportunities for teenagers starting out.
Making the new employees work with the newer rate will discriminate against the senior employees. This will cause raises from the new persons supervisor through the rest of the vertical organization to eliminate employee morale problems. This creates a problem for future plans as monies will have to be allocated for all of the extra expenses associated with payroll to be held onto.
A very large concern about any new minimum wage mandate is that there is no automatic increase in production as a free market will require for the extra costs. The vast majority of minimum pay personnel starts there and rarely stays there. They gain experience and additional training and move up the ladder. If they can accept additional duties and responsibilities, they are given raises. If they are not able to become more valuable, they are let go.
The largest issue with the Federal mandates that deal with raising starting pay does not discuss, openly, who it does benefit. Union contracts dealing with pay are based on certain factors of the minimum wage. Raising this starting point for the very small number of people who earn this rate gives the unions fuel for contract renegotiation with other companies.
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