All of the talk in the news lately about raising the minimum wage to $10.10 hour . this is my option and Suggestion.
Opinion By: Edwin L. Crammer, CPA When I started my first job way back then, the minimum wage was .75 cents an hour. After three months on the job the minimum wage was raised to $1.00 per hour, a 25% increase. Boy was I excited when the rate was increased, but back then I was only seventeen years old and lived with my parents.
Since then, it has been increased periodically, to the point where it is now $7.25 per hour, $7.85 in the State of Florida. Many economists, have said that by adjusting for inflation, the minimum wage realistically is over $11.00 per hour. This issue has always been a contentious issue in Congress. The Republicans are traditionally against increasing the rate and they site logical, but not necessarily true reasons for not increasing the rate. The Democrats are for and have always been for increasing the rate. They citied their reasons why it is needed, but those reasons are not necessarily true for other reasons.
The Republicans state that raising the minimum wage will increase inflation and will hurt the small businessman as he will not be able to raise his prices to cover the increased cost. He would then have to compensate for the increased cost by letting some of his employees go or to put some if not all of them on part time. The Democrats argue that by increasing the minimum wage those employees will have more expendable cash that they will spend in the marketplace and thus help the economy.
These same arguments are presented by both sides and after the minimum wage has been raised, there has been no evidence to show the statements by both sides to be true.
The truth is that those employed in business and who are paid the minimum wage are for the most part, those individuals who are starting out in life with probably their first job. These are individuals who have little if any formal training in any specific job skill. This first minimum pay job is in actuality a learning skill that hopefully they will benefit from and acquire a minimum of new skills and knowledge that they can take forward to a new job at a higher pay level.
It would behoove those individuals who take these beginner jobs if they like the work they are doing, to enroll in a local vocational school to learn more advanced skills in the field they are working in so that they can take to a better paying job. Most communities will provide free education for those impoverished individuals to attend these classes, which in most cases can be taken in the evening.
This now takes me to my idea for resolving the problem. As I had said earlier, most of the individuals employed in these bottom line minimum wage jobs had little or no experience working in the outside business world. My idea shows a way to encourage those individual to look to go further and make a life for themselves that will ensure them a comfortable living.
My plan begins by raising the minimum wage to $8.00 per hour. The reason for this being that I hate counting in uneven digits. Eight dollars an hour I can easily add up in my head, when computing the number of hours worked. $8.00 x 40 = $320.00. $7.85 x 40 = $???
The law would state that for newly hired individuals the minimum wage would be
eight ($8.00) per hour.
After that employee has been gainfully employed at the same job for six months and has shown up on time and learned the necessary skills in the job, then the law would state that the employer will be mandated to increase the base salary of that individual to a minimum of ten ($10.00) per hour.
You may say if that rule is implemented the employer will just fire the employee at six months and hire someone to replace him at the starting rate. Anyone who says this will be someone who has never owned a business. There is a hidden cost every time a business hires a new employee. Until that employee learns the skill necessary to perform that job in an efficient manner the employer loses money on that employee as that employee will not be doing the work he has been hired to do at the same speed or skill level of someone that has been doing the job for a long time also a new employee can make mistakes that, in some cases can be costly. If the employer has a business where the employee has to work face to face with customers, there a learning curve on what the customer likes and dislikes in the products sold.
Therefore, there will be a disincentive on the part of the employer to fire that employee and replace him with someone else. After all, you know what you have and do not know what you may be getting.
I will end this with one comment. Many of these individuals, who are making noise about raising the minimum wage, many of them are in a high power level job of their own, employ interns in their businesses who are traditionally not compensated for the work they perform for these companies. Why is there no outcry out there for an end to this legal slavery.
You may contact Edwin L Crammer at: Edwin@edwinlcrammer.com