You may have seen Joe Biden intends to raise the minimum wage to $15. This is put under the compassionate term of a “living wage.” This is hogwash as the living wage for anyone is highly dependent on where you live. Further, as of the latest report in 2017, a whopping 2.3% of Americans work at or below minimum wage. They tend to be under 25, not married, and work part-time in the foodservice industry. Not a particularly populous coalition there.
The driving force for this is the Service Employees International Union (SEIU). It is a strategic move for their leadership that aligns with Democrat’s needs since almost all union donations go to their candidates. Unions are about two things, density, and dues. The SEIU knows that their employees, at minimum wage and above, are in the jobs that are most likely to be replaced with automation, like kiosks. To preserve their income, made up of dues, they are willing to accelerate a loss of an estimated 2 million jobs to ensure their coffers stay full long term. It has zero to do with advocating for their members.
If this passes, in addition to lost jobs, there will be price increases for everyone. Companies pass these on to their customers as a matter of course. Many people in positions that pay below minimum wage are tip eligible and clear more than $15 an hour regularly. This is why it isn’t easy to get good bartenders and waitstaff to go into salaried management jobs. Some cities have implemented a $15 minimum wage. Restaurant meals cost more to cover labor expense with customers not tipping, or a flat service charge is added and distributed among all staff. Either way, the level of service an employee provides is no longer a factor.
Joe Biden has also pledged to roll back President Trump’s tax cuts by letting them expire. This will affect business owners and individuals, no matter how much you make. The tax rates for everyone will revert to what they were through 2018, and your first paycheck after the expiration will be smaller if you get a paycheck. Employers hired additional staff and raised wages under a lower corporate tax rate. These factors combined may force them to reduce their workforce.
The driving force for this is the Service Employees International Union (SEIU). It is a strategic move for their leadership that aligns with Democrat’s needs since almost all union donations go to their candidates. Unions are about two things, density, and dues. The SEIU knows that their employees, at minimum wage and above, are in the jobs that are most likely to be replaced with automation, like kiosks. To preserve their income, made up of dues, they are willing to accelerate a loss of an estimated 2 million jobs to ensure their coffers stay full long term. It has zero to do with advocating for their members.
If this passes, in addition to lost jobs, there will be price increases for everyone. Companies pass these on to their customers as a matter of course. Many people in positions that pay below minimum wage are tip eligible and clear more than $15 an hour regularly. This is why it isn’t easy to get good bartenders and waitstaff to go into salaried management jobs. Some cities have implemented a $15 minimum wage. Restaurant meals cost more to cover labor expense with customers not tipping, or a flat service charge is added and distributed among all staff. Either way, the level of service an employee provides is no longer a factor.
Joe Biden has also pledged to roll back President Trump’s tax cuts by letting them expire. This will affect business owners and individuals, no matter how much you make. The tax rates for everyone will revert to what they were through 2018, and your first paycheck after the expiration will be smaller if you get a paycheck. Employers hired additional staff and raised wages under a lower corporate tax rate. These factors combined may force them to reduce their workforce.
