Thu
Jul 26 2007
06:54 am

The KNS has a somewhat biased article about the federal minimum wage increase that went into effect this week. They advance the tired right-wing conservative argument that it isn't necessary because nobody makes minimum wage anyway.

So if nobody makes minimum wage, what's the big deal with raising it?

The KNS fails to mention that Tennessee is one of only five states without a state minimum wage law, in the distinguished company of Mississippi, Alabama, South Carolina, and Louisiana -- some of the poorest states in the nation.

The KNS fails to mention that more than thirty other states have a state minimum wage higher than the federal, including our neighbors in North Carolina and Arkansas.

The KNS fails to mention that nearly 50,000 Tennessee workers are paid at or below the federal minimum wage. They also fail to mention that many of these workers are single mothers who cannot afford health insurance or day care, even with the increased federal minimum wage.

CBT's picture

In what industries are these

In what industries are these 50,000 Tennesseans working? Is there a breakdown? Could it be in jobs like restaurants where tips can make up more than the difference? The KNS identifies workers in various lines of work (restaurants, construction, general labor) who all make above the minimum. Please cite examples of those who do make only the minimum wage.

One point left out of the KNS story and generally not discussed is the effect of the minimum wage on union contracts. Many union contract wages are tied to the minimum wage (not so their members make the minimum, but so they get an automatic comensurate increase, without a contract negotiation). This is the reason this issue gets brought up yearly with a push from big labor. Can anyone point to a reliable, unbiased source which details how much union workers benefit from this increase.

R. Neal's picture

Some more perspective. Many

Some more perspective. Many minimum wage jobs are in the service industries such as restaurants. Looking at some publicly traded restaurants for which figures are available...

Ruby Tuesday had revenues of $1.3 billion last year, which is about $34,000 per employee.

Yum! Brands (KFC, Pizza Hut, Taco Bell, etc.) has annual revenues of about $9.9 billion, which is about $35,000 per employee.

If every single employee made minimum wage (which they don't -- most if not all make more) the 70 cent increase would be about $1400 per year per employee out of the $34,000 to $35,000 in revenues per employee, which is about 4%.

If Yum! brands had to raise the price of a 99 cent taco to cover the minimum wage increase (which they wouldn't), would it kill you to pay $1.03 for a taco?

In contrast, Ruby Tuesday's CEO was paid about $8 million last year in salary and options. Yum! Brands CEO raked in about $16 million.

michael kaplan's picture

minimum and living wage

The minimum wage, if updated to reflect the cost of living index since the 1930s when it was first instituted, would be around $10/hour today -- which is roughly what the "living wage" is.

Here are some statistics.

R. Neal's picture

Looks like we were

Looks like we were cross-posting CBT. The previous post was not in response to your question. It was a general observation about the restaurant business.

R. Neal's picture

Here are some nationwide

Here are some nationwide statistics from the BLS:

• 46.7% of minimum wage earners are 25 or older.

• Twice as many women as men make minimum wage.

• There are 922,000 single or divorced women making minimum wage.

• 634,000 minimum wage earners work 35 hours or more per week.

• 448,000 minimum wage earners work full time (40 or more hours per week).

• There are 772,000 people with post-secondary education (some college, an associates degree, or a college degree) making minimum wage.

• Only 8.6% of hourly workers work in food prep/serving jobs.

• 72,000 minimum wage workers are in management/professional jobs.

• 240,000 minimum wage workers are in sales/office jobs.

• 128,000 minimum wage workers are in production/transportation/materials handling jobs.

I don't know the answer to your question re. upward pressure on union wages tied to minimum wage increases. But I'm guessing they have had raises in the last ten years while waiting for Congress to raise the federal minimum wage.

CBT's picture

What's the old

What's the old phrase...lies, damn lies and statistics. I'm not sure this gives a complete picture. That's the problem with this and many other issues. Lots of people throw around numbers (that's not directed at you Randy) and it's hard to get a complete understanding.

R. Neal's picture

Here's the

Here's the source:

(link...)

You can cherry pick your own statistics!

Hey, doesn't the BLS report to President Bush? These numbers have to be spot on dead accurate, then.

Up Goose Creek's picture

Inflation

CBT, the simple fact is that minimum wage has not kept up with inflation. 2-3 years ago when I had time on my hands I made up a little graph with MW and inflation. Except for 1969 when MW was abnormally high they followed a very straight line for decades. Until the early '80s when MW leveled off and inflation continued. According to that chart MW should have been around 7.25 back then.

I don't think it's unreasonable at all that MW follow inflation. You and I benefitted by being able to earn a certain wage during the years that we were young and unskilled. Why deny that to today's kids? Why deny that ot older workers who weren't able to aquire skills because of family obligations, lack of support networks, etc.

So what if the MW law doesn't affect 95% of workers. It's the 5% I'm worried about.

____________________________________
Less is the new More - Karrie Jacobs

Please note that my tagline refers to housing - NOT to wages.

Factchecker's picture

What's the old

What's the old phrase...lies, damn lies and statistics. I'm not sure this gives a complete picture. That's the problem with this and many other issues. Lots of people throw around numbers ... and it's hard to get a complete understanding.

Perfect boilerplate argument against anything. At least to keep from loosing one's prejudice, anyway.

P.S. In terms of wealth and power, Fred Thompson is as much "Hollywood Elite" as anyone. Just not in the pop culture sense. Sorry to ruin the stereotype.

Elrod's picture

Tied to union contracts

I think many union contracts ARE tied to the minimum wage. That just makes it more essential that the MW go up. It means that many more than the mere fraction of actual minimum wage earners will get a raise. And with the Dow over 14,000 surely the lowest paid workers deserve a raise.

CBT's picture

I'm not sure what Fred has

I'm not sure what Fred has to with this thread, but I'm guessing Big Fred doesn't hang with TomKat, Posh, Ashton, Demi and the gang. Think you'll find him at a Galaxy match in the lux box? Don't think so. Fred's definitely got Hollywood connections. But, it's more old school than the new generation of the supercool.

zoomfactor's picture

"new" generation?

Huh? Tomkat and Demi are middle-aged. Heck, they are older than Fred's trophy wife!

CBT's picture

True, but Tom and Demi marry

True, but Tom and Demi marry the much younger crowd (Ashton and Katie...what about 25 or so?) and hang with same. I don't think the 40-year old former Republican strategist/publicist Jeri and Tom's Katie would have much in common.

R. Neal's picture

One thing they all have in

One thing they all have in common is that none of them make minimum wage.

Factchecker's picture

I'm not sure what Fred has

I'm not sure what Fred has to with this thread,...

One thing they all have in common is that none of them make minimum wage.

Both true. I admit I was hijacking with the P.S. because I was too lazy to go back and put it in the kangaroo thread, where it applied to CBT's comment there.

Factchecker's picture

At least my third P.S. today

I'm not sure what Fred has to with this thread, but I'm guessing Big Fred doesn't hang with TomKat, Posh, Ashton, Demi and the gang. Think you'll find him at a Galaxy match in the lux box? Don't think so.

The thing is is that every corner of the progressive political world that I know and see finds CBT's world of "Hollywood Elite" just as repugnant as CBT and the GOP does. So really Hollywood is full of cartoon characters to all of America, red and blue alike. Only CBT's side uses them to divide America for political sport, because the GOP can't win any real debates of, like, you know--actual issues. They have to use personal attacks to appeal to people's prejudice. That's wrong and it's getting really old.

Spread your hate at your own risk, but I think you ought to stop associating a bunch of dysfunctional socialites with the Democratic party. I don't know if Tomkat are any more f*'ed up as the top two or three GOP candidates. They'd probably run the country better than it's being run now.

StaceyDiamond's picture

wages etc

To me the problem is not as much minimum wage as the number of jobs hovering around 7$ an hour, that might require training or even a degree. From experience I think the bare minimum wage should be 7$ an hour, which is still very difficult to live on.

R. Neal's picture

Re. union contracts tied to

Re. union contracts tied to the federal minimum wage, I e-mailed the AFL-CIO and asked whether this was generally the case.

Gordon Pavy at the AFL-CIO says:

"There is nothing to this. I don't know of any contract with such a provision, although there may be one."

Not that this would necessarily be a bad thing, as Elrod points out, but I'd be interested in any examples of such a contract.

I googled and googled, and all I could find were conservative talking points on blogs, blog comments, and right-wing op-ed columns asserting that most or all union contracts have such a provision.

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