Most jobs will give you a performance review and a raise every year to account for inflation and any increased duties you’ve taken on. We increase minimum wage by massive amounts after far too many years which causes all sorts of economic concerns, business complaints, and just a bunch of arguments everywhere. Shouldn’t they just increase minimum wage 3.5% or whatever, every single year?
Got to think about those poor business if they have to pay a nickel more for labor they would be broke
Joking aside, minuim wage is a hot issue. One side fully believes that minuim wage is in fact a bad thing and shouldn’t exist. So for them putting a bill out that auto raises it would be counter productive to
their interestsbusiness being able to hire with supply demandIf a business cannot function while paying a decent wage it should not exist.
Businesses with unrealistic business plans fail everyday, it is a basic function of capitalism.
It is not a society’s responsibility to prop up business ventures that waste capital by continuing to pursue uneconomically viable enterprises.
And further more, if a business pays it’s employees such a low rate that they need government assistance and the company is so important that they need to be subsidized like that, the company should be owned by the government.
Somewhere, a Walton just sneezed.
Cost of living adjustments need to become a regular and expected demand from workers. Because yes, if they conveniently fail to give you a raise that at least meets inflation every year, they are effectively cutting your pay in a way that the legal system has absolutely no problems with.
They already lie about inflation to make it look like the economy isn’t in dire straights. Indexing minimum wage to inflation would make them lie even more.
Economists think that directly tying wages or prices to inflation can cause inflationary spirals. CPI is based on prices, and raising wages will eventually raise prices and CPI, so if you raise wages based on CPI, it can enter a positive feedback loop.
It might be ok if the feedback is slow enough or if the minimum wage influences a macroeconomically insignificant proportion of wages.
Economists must think Belgium doesn’t exist. See this document explaining how automatic indexation happens for all Belgians (including those on pensions) without there being a higher inflation than in the other countries: https://www.abvv.be/sites/abvv/files/2023-01/Index_EN final.pdf A lot of it is: we simply get the raise a little quicker and without a fight, and only have to fight for real wage increases. Where in other countries they need to wait for the next wage negotiations and then fight to keep the real wage and hopefully increase it too.
We definitely don’t want that, since that hurts everyone, sapping value from wages and savings. I’m definitely not an economist. I was just thinking about how long we go in-between minimum wage increases and how it impacts prices every time it goes up. I was wondering if it would have less of an impact if it was raised incrementally instead of sudden big increases.
I was wondering if it would have less of an impact if it was raised incrementally instead of sudden big increases.
It probably does yeah. You can clearly learn sth about power within our system by seeing which jobs adapt their wages to inflation first. Aside from the ones who are in high demand anyway.
The quick answer is cola should be built into the system. Neither party has taken minimum wage laws seriously. States have taken it more seriously than the feds. All jobs should be required to give a cola increase every year.
The minimum wage should include 1 voting share upon the worker joining the company that can only be given up by leaving the company. No voting shares should be held by anyone that isn’t currently working at that company
