Saturday, March 9, 2019

Minimum Wage Laws Don't Work

It must have sounded like a good idea. It appealed to low income voters, thus, to a leading Democratic Party constituency. The policy proposal was simple: government would mandate a higher minimum wage. Great news. Everyone would be getting a raise. Everyone would take home more money.

We already know that New York restaurants responded to the city’s own minimum wage law by cutting back on employees and on employee hours. Obviously, the whole boondoggle shows why government should not run the labor market.

Heck, even Amazon, owner of Whole Foods, has responded to the minimum wage hike by reducing employee work hours. Duh… who could have imagined such a thing?

The Daily Wire has the story (via Maggie’s Farm):

The dream of the $15 minimum wage was finally realized among Amazon employees after the company caved to mounting pressure and implemented it company-wide on Nov. 1. But according to a new report, the improved wages aren't working out as many employees had hoped at Amazon's Whole Foods grocery store chain.

The Guardian reported Wednesday that employees at Whole Foods, which Amazon purchased back in 2017, have experienced a dramatic drop in schedule shifts since the raised wages were introduced.

Along with the new $15 minimum wage for the entry-level positions, some higher-level Whole Foods employees have also enjoyed a $1 to $2 increase in hourly wages, the outlet notes. It all sounds good — until employees' schedules are taken into account. Since the wage increase in November, Whole Foods employees say they've experienced "widespread cuts that have reduced schedule shifts across many stores, often negating wage gains for employees," The Guardian reports.

The employees, speaking on condition of anonymity "for fear of retaliation," revealed to the outlet that they've seen an average of about a 30% reduction in hours per week for part-timers and about a 10% reduction for full-timers.

An Illinois-based worker told The Guardian, "My hours went from 30 to 20 a week," after the $15 minimum wage hike.

Did you notice, this story comes to us from a British newspaper, The Guardian? As you know, it is not a right wing newspaper, incidentally.

In Maryland management has also reduced employee hours:

A Maryland-based employee told the paper their regional manager has ordered that all full-time employees suffer a four-hour reduction per week to 36 hours, making the raise "pointless" because people are actually "losing more than they gained" as a result of fewer hours worked. An Oregon-based Whole Foods employee cited a similar policy of reducing full-timers from 40 to just 36 or 38 hours per week.

Fewer hours at work… if, that is, you still have a job. What could go wrong when politicians decide to pay off their voters with someone else’s money?


UbuMaccabee said...

Leftists want to feel good. Doing good takes effort, and they shun meaningful work. It’s so much easier to virtue signal with other people’s money, damn the consequences, than to achieve real results. Next the leftists will use the legislature to demand the number of hours the employees must receive. It always ends in a bigger government and less freedom.

Anonymous said...

If the work could have been done in less hours all along, why were these companies paying for more hours than they needed in the first place?

David Foster

Sam L. said...

Politicians don't pay employees of companies. They also don't have to deal with payrolls or employees or serving the public.

Ignatius Acton Chesterton OCD said...

As usual, Lefties overvalue labor, just as they do knowledge (college) and mass transit (light rail). All this is very expensive, but the Tooth Fairy leaves money under every pillow.

Minimum wage = minimal workers.

Anonymous said...

I recall the CEO of Starbucks, Schulz, virtue signalled for $15 min wage, and then cut his full time baristas hours to part time to avoid providing them the mandatory health care benefits he no doubt also virtue signalled for.