Aviator

Productivity has everything to do with it. Business is about making more money than it outlays to produce an item or service. If you pay someone $15 an hour and their worth equates to $10 an hour, the company if $5 an hour worse off for having that person than not.

Higher minimum wage helps some, but not the challenged members of our society. Some workers who are less productive won't get jobs because the company cannot justify it.

Cost of living wages and pay rises are not the responsibility of commerce. People have a choice who they work for, or they can start their own business. Being self employed now, I have worked for nothing when starting a venture.

Payroll is a function of cost of production, sales and profit. Payroll budgets reflect how much should be spent on wages and ultimately how much is paid to each employee and how many employee hours can be afforded with in that budget.

Because the cost of living in one area is higher than another, a business cannot always just pay more and charge more because of that location and remain competitive in their market place. Some are the exception, especially in inhospitable places or less desirable jobs.

As well as pay increases, raw materials have increased many fold, prices are under pressure because consumers want to pay less and because of offshore manufacturing. This also results in fewer jobs at home and more people looking for work.

We will see fewer workers in coming years and market forces will likely dictate higher wages and higher prices, or more offshore production.

There was talk of wanting a $15 minimum wage legislated as in some US states. If this happens I believe many smaller businesses will either move or close down and larger business will increase prices, and as consumers we will pay more, the cost of living goes up and that pay increase won't have any more purchasing power than the present ration of min wage to cost of living.

MarkG

Yeah, because there's nothing else those people can do, is there? Smash The Spinning Jenny before it puts the Luddites out of work!

My first IT job around 1990 paid two pounds an hour, which would almost certainly be below today's minimum wage in the UK. It certainly wasn't enough to live on, but it was great for a kid still living with his parents.

The big problem today is not wages per se, but that governments keep interest rates artificially low, which massively inflates the cost of living and trashes the value of those wages. That's what needs to change, not the amount people are paid.

BristolUK

And creates other problems that everyone ends up paying more for.

Ah yes, the old "why don't you start your own multi-national corporation" argument.

scrubbedexpat091

I am so sick of hearing, poor small business owner, but what about the employee making the money for that owner who isn't being paid enough to even rent housing let alone eat?

We will never agree, so I am not going to continue this, its clear as day you support low wages so a few can benefit at the cost of everyone else.

A low wage earner isn't going to have the funds available to open a business, this is an unrealistic option for the majority of those making a low poverty level wage. If someone cannot afford housing and food they certainly are not going to be able to open a business, not to mention most likely don't have a skill that would permit them to open a business hence why they are a low wage earner. You can't start a business with ZERO money, nor can someone making a low wage keep their housing, food and basic needs if they are not earning something, and since business rarely make money from day one, they obviously won't have the ability to go without a pay check for an extended period of time.

Most low wages earners also have very little choice over where they work, I don't choose where I work, they choose me, I need a job and have to take whatever is offered, I would not call that choice. Shows me you don't have any idea of what it's like to be a low wage earner.

When you can't buy food, can't pay rent, can't afford transportation to work, can't afford the uniform you need for a job, then maybe you will understand what it's like to be a low income earner.

Would society not be better off if people like say me were not receiving a 500 per month rent subsidy and could actually afford to pay market rent?

Aviator

The opportunity is there for everyone. Multinationals are in a minority, the bulk of small business is home based.

There are plenty of self employment opportunities, one does not need hundreds of thousands to go into business. Richard Branson started off with a self published magazine, then selling records out of a phone box.

Some folks are risk adverse, but want the benefits once other have taken the risk. I took a $100k+ hit last year with a company going down owing me for unpaid product, employees still got paid though.

I made a suggestion to an employee who wanted more money (more than their productivity allowed),
a) we pay them what they get now as that is what they were worth.
b) they assume the same level risk as me, I pay them based on projected performance. This could have given them a 100% increase However this was tied to company performance and if we lost money, they got less or even may have to pay us to contribute to the loss. They went with plan a.

scrubbedexpat091

A poor person will not have the funds to open a company, this is not a realistic option for them and those who suggest it have no idea what reality is for low wage earners and how difficult it is to even provide the basic needs of housing and food let alone anything else.

Yes there are exceptions, but they are just that exceptions, not the norm.

There isn't one business for example I can think of that I could do, those who can awesome, but they were born with a skill and ability that not everyone has.

Aviator

I am a pensioner now! Some pilots are on minimum wage, one young guy I know is netting $5 an hour in the right seat after he has paid off his PPC. Many pilots have 2nd jobs as they are not getting the hours. Pilots of low cost airlines are not that well paid, grocery store clerks do better. Some flight crew do get well paid, but not the majority.

For some they have $95k investment in their training, thet they paid out of pocket. Other took the service route, the price of that was being in harms way.

I am not sure how you would get to the 'low productivity' for pilots at an airline. Without pilots nobody would have a job at an airline. How do you measure productivity for a pilot? Arriving on time, not getting lost, arriving with as many folks as you set off with, being able to use the plane again after landing?

Low wage earners can start and do run businesses. One of my kids has challenges, they manage to run their own business from home. Not a big business, but enough to get by on. Buy a few supplies, make some stuff and sell it, buy some more supplies. Not a big investment, but they are doing OK and highly motivated.

scrubbedexpat091

Your so keen on productivity so you tell me how? If pilots can't be judged on productivity how can anyone else? You seem to have no issue using productivity to keep wages low for others.

How do you judge productivity for a night auditor at a hotel? You can't so how can pay be based on productivity? (just one example)

I was referring to major airline pilots, not some young guy/gal starting his/her career. Nobody can expect high wages at the start of their career, but the issue is for low wage earners their wages never go up no matter how hard they work, how long they stay with the company, the wage stays the same.

Good for your kid, but if you have nothing you are not going to start a business, and not everyone has a talent to make and sell things. Takes money to make money and majority of low income earners have no money to invest into a business that will likely fail when they can't even provide adequate housing, food and necessities of life.

What would I for example do to have my own business when I have nothing to start with? I cannot think of 1 type of business I could start with nothing, and make a living off it without interruption of income with the skills and abilities that I have. Motivation wont provide a roof or food on the table, nor will it provide the necessary capital needed, nor the skills needed to run a business.

Those who can start with nothing and make something are the exception, not the rule, most cannot and will not do it. You can't use exceptions and expect everyone to do it.

And guess what, if not for everyone else at an airline the pilots would not have a job either, takes a team to run an airline, and pilots forget this, You can't fly a plane if someone isn't there to fix it for example.

It boggles the mind how people can advocate keeping wages low so they can benefit while others suffer. Try going hungry and rationing food because you don't get paid for a week and can't buy any then maybe you will understand what its like to be a low wage earner.

Almost Canadian

What is stopping you from starting a business that supplies "night porters" to other businesses, or something similar? It appears to me that, to start such a business, one simply needs a telephone.

You could then pay your employees whatever wage you wish to which would, of course, determine how much money you would make. Maybe then, you would understand why you are paid what you are.

scrubbedexpat091

Why don't you go and work for 12/hr then? If your not working for a low wage, then you have no idea what it's like and have no reality of the life of someone who does and the hardships they go through.

I would assume at the very basic for that sort of business you would need:

Business license.

Advertising costs.

Payroll costs.

Insurance.

Phone obviously.

Probably a website.

And would need to know the market and profession and have experience in the field, of which I do not. Seems silly to try and run a business you have no experience in.

I know the in's and out's of small-medium sizes hotels, but the capital needed is huge, so not an option. A small profitable 80 room hotel will run a couple million to buy or build.

MarkG

Ah, yes, the old 'let's make a joke so we can ignore the point' argument.

Most people don't work for multi-national corporations. Even most fast-food places are franchises run as small businesses, not employees of the franchising corporation.

There's little to stop the employees of a McDonalds' from putting together a business plan, getting a bank loan, and opening their own burger joint. Since they're all so much more productive than the people who run the corporation, they'll do great. So why does it so rarely happen?

Certainly here, we rarely buy anything from McDonalds' because there's a local burger store that's much better and not much more expensive. But there are still plenty of McDonalds' and Burger Kings around.

Aviator

Your productivity would be based on whether you carry out your job accurately, within the time frame expectation and any problems were dealt with within company procedures to the satisfaction of the employer and customer.

Pilot productivity would be accuracy and skill based.

Even top tier carriers don't pay huge sums, low cost carriers are low cost, because people want to get cheap airline tickets (as many threads on here show). Low cost tickets come at a price to the employees, pilots included, although their role is pivotal to the success of the business and the well being or the pax. Employees improve their lot by seeking promotion or more responsibility, not just doing the same.

My kid started with $100, from their minimum wage job, working out of their living room, they own their home, lives alone and has done this themselves overcoming some significant personal and physical challenges.

Many people have. My friend Joe Roberts, was about as low in life as you can get. The Skid Row CEO | Joe Roberts | Inspirational Speaker | Professional Speakers | Conference Speakers | Hire a Motivational Speaker

Those who can start with nothing and make something are the exception, not the rule, most cannot and will not do it. You can't use exceptions and expect everyone to do it.

I am sorry to say, talking yourself down and negativity will stop you running a business and in all likelihood improving your lot.

...but there is no point filling it or fixing it if there is not a driver. None of the crews I worked with ever saw the industry as anything else but a group effort. This is even more so in the military.

Many business owners have been low wage earners, many have lost everything. Few advocate keeping wages low, as has been said many times, business pays what it can justify. Wages go up, prices go up, consumers complain. Maybe blame consumers for low wages.

A lot of those who have been fortunate pay it forward to the disadvantaged members of our society. Plenty of business owners started with nothing and took risks, some you win, some you lose.

If you convince yourself you won't or can't succeed, it quickly becomes a self fulfilling prophecy.

MarkG

My family were decidedly working class, though we did graduate to a two TV household when I was a teenager. When my father was laid off from the factory he'd worked in for years, he set up his own business instead, and that kept the family going until he retired twenty years later. I run a small business on the side which doesn't make much money, but the setup costs were a few hundred dollars, and, if I ever get laid off, I'll work on building it up to a viable income. Last winter I was waiting at the bus stop when a guy stopped beside me holding a shovel. He said his cell phone got cut off, so he was going out to make some money shoveling people's driveways to pay it off. How much does a snow shovel cost?

Most people just prefer to complain than do something to improve their situation. If that's the approach you take, if you really believe you need someone else to 'give' you a job rather than make it yourself, you can't expect much.

And, like I said, housing is expensive because government makes it so by holding interest rates at insanely low levels. Why not do something about that, instead?

scrubbedexpat091

If I lived somewhere where snow was the norm, I'd do it.

I am just being truthful when I say, I have no idea what sort of business I could do that would bring in income, with limited finances, bank loans, family loans etc are not an option. It would literally need to be a tiny amount needed.

I have thought about business before, I just can't think of anything. I am not a builder or a tech guru so things like that are out as is anything labor intensive due to health issues.

We did okay once I was in my teens and both parents had been with their companies for many years (dad works for government, mom was a paramedic but since retired from that and works at a hotel now.) but my dad has worked for the same employer since 1978, so even before I was born, but suppose government jobs tend to be more stable.

My grandfather had his own business in property management, not totally sure what he did exactly, but from what I can recall he managed apartment buildings and condos.

My other grandfather was a career politician.

scrubbedexpat091

Low cost carrier doesn't mean they have to pay peanuts if they are a well run organization with good management. Southwest which can't be denied as the most successful airline in North America, has remained consistently profitable then any other airline, and their employees are some of the highest paid if not the highest paid in the industry now.

More responsibility has never led to more money at the companies I have worked for, they just used it as a way to hire less people and have you do more work and be responsible for more things, but not provide any benefit to the employee.

I did the job of 3 people at the last hotel, what benefit did I gain from it? None, they just used me doing the other 2 jobs as a way to not hire more people. My pay certainly didn't go up, but my stress levels certainly did.

Maybe in management more responsibility = more pay, but not in the kind of jobs I can get.

Management is not for me, I hate it, I don't excel at it, and I just suck at it, hence why I need a job that pays well from the start but all require school which is my hurdle.

I'd be quite happy as a psych nurse making 31/hr to start, I don't need to be rich, just enough to have a life.