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Amazon Will Raise Its Minimum Wage To $15 For All 350,000 US Workers (recode.net)
Amazon said Tuesday it's raising the minimum wage for all 350,000 of its U.S. employees to $15, effective next month. From a report: The new pay threshold will go into effect Nov. 1 and impact all full-time, temporary and seasonal workers across the company's U.S. warehouse and customer service teams as well as Whole Foods, the company said in a blog post. It did not disclose what its current minimum pay wage is for U.S. workers, perhaps in part because there is not one set rate. "We listened to our critics, thought hard about what we wanted to do, and decided we want to lead," Amazon founder and CEO Jeff Bezos said in a statement. "We're excited about this change and encourage our competitors and other large employers to join us." Alongside the cash compensation bump, Amazon said it will eventually eliminate its practice of granting stock to these workers and will instead institute a program that allows them to purchase Amazon stock through the company. The announcement comes as Amazon faces increased criticism over its pay and treatment of warehouse workers. Senator Bernie Sanders, in particular, has been relentless in his criticism of Amazon over the last few months, proposing a bill that would tax the company as a penalty for having workers who need food stamps and other public assistance to make ends meet.
WSJ reported today that "Amazon, which has faced criticism about pay and benefits, said it would raise the minimum wage for all U.S. workers. The company will also start lobbying Congress for an increase in the federal minimum wage, which is currently $7.25 an hour"
Might not be mentioned in the original summary or article.
Wages tend to be a small part of the cost of most goods though. When you look at he volume of bread coming out of factories and the number of people working there, wages don't contribute much to the sale price.
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SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
And productivity has doubled in the last 20 years
In America, productivity has gone up about 30% in the last 20 years.
... and continues to climb
In America, productivity growth has been mostly stagnant since 2004.
If anything we need shorter work weeks and higher pay to absorb job losses due to increased productivity.
There is little historical evidence that increased productivity causes job losses. There is much more evidence for the opposite, and productivity improvements are more often than not correlated with rising labor force participation rates.
As workers become more productive, it is more profitable to employ them, so demand for labor goes UP, not down.
Countries with low productivity growth tend to have higher unemployment.
Predictions of job losses from productivity improvements are usually based on the zero-sum Lump of Labor Fallacy.
The median house in America today is more than twice the size it was in 1914. If you calculate by square foot of housing, wages today are about the same.
But housing prices have climbed faster than general inflation for most of the last century, so it is not a good benchmark for comparing wages.
In most of those examples, there is still an underlying labor cost.
And no one is disputing that. What we are disputing is your attempt to make that labor cost a large part of the overall cost. And it simply isn't.
In the end, the vast majority of the cost of any goods are labor.
[Citation Required]
Let's look at some numbers instead. Raising the minimum wage from $7.25 to $15 is a more than 100% increase. So what affect would that ~100% increase have on prices? Well, let's look at the worst-case scenario: Fast food. Because unlike all your examples, a significant percentage of the costs in a fast food restaurant is wages.
That 100% increase in wages translates to....a 4% increase in the cost of the food. Or about 17 cents for a Big Mac.
If a 100% increase in wages only yields a 4% increase in one of the most wage-intensive industries in the country, we probably shouldn't be worried much about the effect on the price of milling wheat into flour.