Chipotle bumps pay to 15$, adds benefits in push to hire 20k
linkedin.com
linkedin.com
Amongst all the companies complaining they can’t find workers, they seem to all maintain a truly massive cognitive dissonance and lack of complete self reflection.
Good for Chipotle for demonstrating actual leadership.
If anyone here is a fan of the tv show The West Wing, I always like the quote
You are so fond of calling yourselves the "leaders of the free world." So, lead.
I'm no economist, but I'm pretty sure this just out prices small businesses. Bigger businesses can take the strain and get some great PR.
I've always found it interesting that the plague was one of the major drivers of the elimination of serfdom in western Europe. When half the population died, workers suddenly found themselves in high demand. They were able to demand better working conditions and dramatically higher wages. [1]
I'm hoping for a softer version of this in high unemployment payments.
Personally, I'm ok with business who can't afford to pay employees a living wage going under and being replaced by ones that are willing to.
[1] https://en.wikipedia.org/wiki/Consequences_of_the_Black_Deat...
I think what many businesses of all sizes often forget is that you get back what you give, usually as a multiple. Further, this increased return is often overlooked or ignored since its not immediately measurable until the action (increasing employees' pay) is taken. The flip side being, an increase in wages is an immediately determinable cost and so becomes the initial focus.
However, I don't like the process. You can't just let the Fed/government follow a strategy because that strategy does not fulfill its stated goals which results in doubling down on the strategy. Increasing the money supply is only excusable if you do so to hit your 2% inflation mandate. The Fed needs more precise tools so that it can actually do its job without collateral damage.
Relying on the government to send economic stimulus only works when the government actually thinks that the economy is in big trouble. It's a good fail safe but it doesn't help when your economy is limping at a low growth and inflation rate for a decade. It's easy to shoot down a infrastructure bill if the only reason it exists is to add 0.5% inflation from 1.5% so that you hit 2%.
Given enough time, the minimum wage would simply cease to be impactful.
We should reset the minimum wage to at least levels on par with what it would be inflation adjusted. That impact on the economy was the intention of the law in the first place. Jobs that are lost are jobs we never intended to exist in the first place.
Remember, you can still do lower than minimum wage work if you work for yourself. With a hiked wage, no longer will corporations be able to capture this section of the market, and instead small businesses can do it instead which would be more stimulative for the economy.
I'm not so sure of that, we couldn't possibly assess the full impact here, but I guess we'll see what happens. I would think constraining large companies only would be the solution here, and small companies have more options because presumably the employer and employee relationship is much tighter and they can sort things out better. Hope it works out for the best.
Most families have both parents working so they can afford to live at the same level that a family in the past could afford with one working parent.
If minimum wage was meant to support a family where only one adult is working then we would in fact need to double it to really make it have the same effect it did in the past.
I'm not saying we should do this, just pointing out that raising the min wage is absolutely a worthwhile goal and so much value has been ripped away from the majority of Americans from inflation.
If we have to think about women in the workforce, then let’s start by considering that the majority of people working awful jobs for awful are women and that even if they leave those jobs they still have a wage gap inflicted upon them.
The minimum wage is meant to help people by enforcing fairness, and in this case it will likely help women.
A number of businesses have signs on the doors saying they are hiring at $15/hr - I think Burger King, Home Depot...
It's disappointing that when Republicans say unemployment benefits are preventing people from going back to work, that Democrats just deny it - they should say "yes of course, that's the point!" And then go on to explain why it's good for the economy and idolatry of unemployment numbers is wrong.
https://www.wsj.com/articles/consumers-adjust-to-higher-pric...
Still far more than they would have been buying with the $7.25/hr of course.
These wage increases are almost certainly net welfare enhancing due to diminishing marginal utility of the dollar.
The money supply of centrally banked economies is mostly debt/demand driver, not supply driven. Money is created when lent, and destroyed when repaid. By tweaking parameters, the Fed is able to manage circulating supply.
It's actually a really elegant system, IMO.
At $0.6 trillion/year it would take 12 years to unwind the 2021 balance sheet. That's worrying but not impossible.
Unilever: https://www.just-food.com/news/unilever-experiencing-worst-i...
https://www.bloomberg.com/news/articles/2021-05-04/inflation...
https://finance.yahoo.com/news/here-are-17-food-companies-th...
Prices now are entirely consistent with average 2% inflation during the course of the last two years, it only increased so much due to prior sharp decreases in inflation.
Whatever, the more people who have a bad mental model of what's going on, the more I make on the stock market, so it's NBD. I would actually encourage you to bet lots of money on your beliefs, it's just another opportunity for arbitrage for me and the institutional investors who know how markets work.
But I see no connection between that and generous unemployment benefits, since they are a drop in the bucket compared to the trillions spent on other things.
I think the economy should be good for society, and that people should be able to prosper if they work, having enough money to pay the costs of the things they need, like food, medical care, etc. I don't feel like there should be a permanent underclass of people who can never get ahead because they are living paycheck to paycheck.
For the sake of the argument lets assume that unemployment benefits give $15 per hour. Those $15/h represent $15/h of pure waste because they have to be paid by employed people.
However, someone using unemployment benefits to obtain the $20/h job implies that taking the $15/h job wastes $5/h of your potential and unemployment increases your future potential by $5/h.
Those $5/h are pure waste, nobody gets them, not even your boss because an employee working in a fast food restaurant can generate less economic value than an employee in a warehouse.
However, unemployment generally lasts as long as necessary. Only a handful of individuals live on unemployment benefits over the long term. If you are unemployed for 6 months you cost the state $14400 (assuming $600 in benefits per week and 4 weeks per month for simplicity). It takes $14400/$5/h = 2880 hours of the warehouse job to break even from a macro economic perspective or 1.6 years with 1800 working hours per year. Of course this is not the actual tax revenue, assuming 27% of GDP is evenly taxed it would take 6 years to break even for the government.
This is just a potential benefit from the "unemployment benefits cause a worker shortage" perspective. If you go one step further there are even more situations in which unemployment benefits can help the economy. For example, what if those people will stay unemployed anyway, even if you cut benefits? They still buy products and services that generate business revenue and the business can use the additional money to hire previously unemployed people.
Of course the ultimate underlying assumption behind everything I wrote is that the economy has an abundance of goods and high inequality. None of this would work in an economy with long term scarcity like a developing country. As it is right now, full employment in the US is a "bonus", the economy doesn't depend on it. Other countries are willing to do almost everything the USA can do but they do it cheaper, which negates the need for low skill jobs to be done in the US.
> The upgraded pay scale will result in hourly employees earning starting wages ranging from $11 to $18.