Another couldn't make this up

Donald Lehman

Well-known Member
Didn't want to hijack the thread below.

News item: Fellow in Washington who was at the forefront of the $15 minimum wage battle has done the math (ATFER the law was passed) and now finds his business is in jeopardy. Seems that even at the interim level of $12 per hr. this moron has finally done the figures and realizes he can't stay in business at even the $12 level, say nothing of the $15 level. He says something to the effect of "I thought it was only going to cost a few extra dollars per year.(?!!!!) I had no idea it was going to cost me this much". He's kinda screwed, since he only has one employee, so laying off workers isn't an option. The prices are printed on the comic books, so he can't raise his prices. His "solution" is to offer a club membership ($240 something a year) where you would get "special deals" an such.

You made this stuff up and nobody would believe you!





This is the fool who was in the forefront of getting this law passed.
 
I am not sure if I found the article you where talking about or not. This article is talking about a San Francisco comic books store owner. He has two locations and voted for the minimum wage law but I did not read anywhere that he was a leader of the cause. So maybe I am reading the wrong article. He does talk about needing an additional $80K in gross revenue from his two stores to make the required wage increase. So he is trying to sell memberships to raise additional money.

The long and short of it is a worked has to be worth his wage for a company to keep employing them. Part of the reason we stopped the feed hauling business was that the profit margins where getting to the point we could not pay the needed wages to keep good drivers. So we quit. So now there are five less jobs. The same thing will happen in the low wage employers business. The self check out maybe be an option in the stores of the future. That maybe the norm is the store can't pay the HIGHER wages required by some law. I think that there are few enough entry level jobs anymore so raising the minimum wage is just going to make there be fewer.
San Francisco s 15 Minimum Wage Hike Forces Comic Book Shop to Come Up with Extra 80,000 a Year
 
There was an article in the paper the other day.In areas where the minimum wage has already been raised,employees are opting not to work 40 hours because 40 hours pay cuts into their section 8 housing and foodstamp benefits. So much for getting the deadbeats off the welfare rolls.
 
The math is simple. Raise minimum wage 10% and very shortly the cost of living goes up.....you guessed it, 10%. Now the math gets a little tricky. If minimum wage is say 10% behind the cost of living when the new wages and inflation are all worked out they are now 11 or 12% behind the cost of living.


As far as workers shifting from full to part time to stay on assistance a lot of that is because the assistance is more than they would make working full time.

Rick
 
Am I reading this right? His margin is so small that a $3/hr. pay increase for one employee is going to break him? He should have locked the doors long time ago.
 
The fellow in the comments was working the math to show that the WAGES did not go up $80,000. The business owner DID NOT say that the wages went up $80K. HE said he needed an additional $80K in gross revenue to cover the increased wages. I missed that the first time I read it too. If you read it fast it sounds like the ages went up $80K but the actual statement shows he says he needs and additional $80k in total revenue.
 
Yes Rick! You got it! A lady my sister in law is
friends with has rental houses, a new vehicle,
govt phone, heating/utility help, a couple govt
paid for kids, but won't marry her boyfriend that
she lives with for the past 16 years or take on
more hours offered to her at her CNA job
because... It would take away her benefits/
entitlement that is actually NOT needed.

Ross
 
(quoted from post at 11:02:05 08/29/15) Yes Rick! You got it! A lady my sister in law is
friends with has rental houses, a new vehicle,
govt phone, heating/utility help, a couple govt
paid for kids, but won't marry her boyfriend that
she lives with for the past 16 years or take on
more hours offered to her at her CNA job
because... It would take away her benefits/
entitlement that is actually NOT needed.

Ross

Ross, thing of it is some of these people would not make enough to cover the loss of the handouts. They would actually wind up going backwards. In part because these are local minimum wage laws, not federal and most often welfare is based on federal minimum wage. I wasn't referring to those cheating the system. Before my SIL changed jobs he made 1 dollar too much a year to get help with medical coverage from the state. 1 dollar. That one dollar wasn't going to pay for much. He's now working for a company with decent bennies. Couple of the wife's cousins are on assistance so I know far more about it than I care to because they are always crying about their bennies. I do try to stay away from them as much as possible.

Rick
 
Raising of the minimum wage reminds me of a company I worked for quite a few years ago.
There were about 500 employees in this company located in a town of about 3,500. It is the main private employer in this town and the owner had a lot of pull with the city council also.
Anyway, this company got a huge government contract spread out over about 4-5 years. They even shut the company down for a few hours to celebrate and announce this contract to all the employees.
This big contract was announced over the local radio, newspapers, coffee shops, you name it. There wasn't really a big hourly wage increase, but it was more like profit sharing and the employees MIGHT get a small bone to chew on at Christmas.
The problem was that nobody told that to the other businesses in town. Soon everybody was raising the rent that the employees were paying. Taxes went way up, as well as utilities. Most of the workers were having less spendable income. A few of them even tried to sue their landlords. (You can guess how far they got with that lawsuit)
I'm just saying that, in this case, it was not a win for them at all unless you figure in the overtime that some of them had to now take.
We'll see just how far the business owners will go and how many of them will shut down when they pay $15-$18/hour for unskilled help.
 
Do what I did. Get a quality color copier. If the politicians can print fake money at my expense, so can I.

Mark
 
Yes, he has only one employee, so laying off to cut expenses is not an option. He runs a comic book store and the prices are already printed on the books so he can't raise his prices.
 
Okay so 40 hours/week for one year = 40x52=2080 hours/year $15-$7.25= $7.75 (gosh wages more than doubled) $7.75x 2080= $16,120 add another $1209 (employer's share of social security equals $17,329 you still have to add in unemployment and workman's comp coverage. If he needs an additional $80,000 in revenue I'm guessing his mark up has got to be close to 20%, not bad but I have to ask what's his current gross? If he's only doing $100,000 a year another $80,000 will be tough, if he's doing $500,000 it might be doable, at $1,000,000 he's got it made.

Issue is the person, as a business owner didn't know what his labor cost really was, and let emotion guide some decisions, are we supposed to feel bad for him because he's incompetent? When we continue to elect people like that to government we're only getting what we deserve.
 
We're all trapped in a vicious greed vortex. Everybody from the top of the chain to the bottom is sucking everything they can out of everything they touch. Is asking for the ability to live a low-level 'decent' life on a full time job working for someone else who's sucking everything they can out of whatever they can while the fat cats at the top are skimming more and more cream every chance they get really asking too much? Minimum wage is not the problem - it's repercussions are the symptoms of a sick society.
 
It doesn't say he only has 1 employee, just 1 employee at the store at any given time. The picture shows 7 people, 1 being him and the other 6 are employees for his 2 stores.

So for a hike from $7.50/hr to $15/ hr, x 6 employees, it's closer to $90,000 if they work a full 40 each week.

He should have known his true labor cost, and realized that he needed more profits.

And the rise in minimum wages, while they should go up some, won't fix everything that people think. The cost will just get passed on to the consumer, who as it turns out is the same people who just got a hike in their wages.

And then there are the other jobs out there that do pay decent. Are their wages going to go up in relation? Is my decent hourly wage going to go up at all because I went to school to learn my trade and have been doing it for 13 years? Or will it stagnate?

I am fortunate that really just about everyone, with exception of the high school apprentices, makes at least $15/hr, and some over $30/hr. Even the high school kids are making $11/hr,and those that were last years apprentices are making around $13-14/hr. That's pretty dam good for their age, and they know it. When I started out 13 years ago, I was making $7/hr. They're doing quite a bit better, even with inflation figured in.

Donovan from Wisconsin
 
We have proof in numbers. The closest minimum wage has been to the cost of living was in 1968 IIRC. Once the government stopped controlling inflation it's gone way out of whack.

So the real question is can a small business survive wage hikes like this? It remains to be seen.

Rick
 
I was making $12 per/hour working for a pool company when I started college in 1971. Was able to pay all college costs and graduate with no
dept in 4 years. Was one of 13 children and had a scholarship taken away from me because my dad made too much money working as a test-man
for Michigan Bell.
 
(quoted from post at 08:02:15 08/30/15) I was making $12 per/hour working for a pool company when I started college in 1971. Was able to pay all college costs and graduate with no
dept in 4 years. .

I can see why. My first time clock job was in 72 at minimum wage......$1.95 and hour.

Rick
 

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