Better pay but with lay offs…

[ChrisL]

My son let me know yesterday that with the state mandated $20 an hour increase coming April 1st for fast food workers, his employer (chain cookie store) let go all of the HS kids and have cut back staffing.  It’s mainly him and two other people + the manager.  They had about 10  HS kids who would cover evenings & weekends who were all advised this was their last week. 

He said it’s really tough as he often has to work by himself so baking & counter work results in longer lines.  I have also seen reports of lay offs & reduced staffing at eateries.

Many lauded the move to higher wages and I’m not opposed to them, but at what cost?  I think if people thought businesses wouldn’t reduce staff to cover raising payroll costs they were pretty naive. 

[Airehead]

I figured they would just raise prices

[Randomguy]

3 minutes ago, ChrisL said:

My son let me know yesterday that with the state mandated $20 an hour increase coming April 1st for fast food workers, his employer (chain cookie store) let go all of the HS kids and have cut back staffing.  It’s mainly him and two other people + the manager.  They had about 10  HS kids who would cover evenings & weekends who were all advised this was their last week. 

He said it’s really tough as he often has to work by himself so baking & counter work results in longer lines.  I have also seen reports of lay offs & reduced staffing at eateries.

Many lauded the move to higher wages and I’m not opposed to them, but at what cost?  I think if people thought businesses wouldn’t reduce staff to cover raising payroll costs they were pretty naive. 

I am sure we can all go without cookies all the time, I am already too fat.  All these 'business' people need to pull themselves up by their bootstraps and not jump into opening businesses that exploit the poorest people out there.  

They need to change their business model or pivot to a different business.

[12string]

3 minutes ago, ChrisL said:

My son let me know yesterday that with the state mandated $20 an hour increase coming April 1st for fast food workers, his employer (chain cookie store) let go all of the HS kids and have cut back staffing.  It’s mainly him and two other people + the manager.  They had about 10  HS kids who would cover evenings & weekends who were all advised this was their last week. 

He said it’s really tough as he often has to work by himself so baking & counter work results in longer lines.  I have also seen reports of lay offs & reduced staffing at eateries.

Many lauded the move to higher wages and I’m not opposed to them, but at what cost?  I think if people thought businesses wouldn’t reduce staff to cover raising payroll costs they were pretty naive. 

It won't be long before they hire them back, and raise their prices to cover it.  Or, shut down because 2 people can't keep up.  Right now, it's an employees' market, so those $20 rates are here to stay.  It will  straighten itself out, and low income workers will benefit greatly.  Finally.

It's also about time we pay waitstaff the full $20- and stop tipping to make up the difference

[JerrySTL ★]

This is what happens when the government forgets about the law of supply and demand.

[ChrisL]

8 minutes ago, Airehead said:

I figured they would just raise prices

That’s happening too.

[Randomguy]

1 hour ago, JerrySTL said:

This is what happens when the government forgets about the law of supply and demand.

I don't know about that, it seems a value issue.  Do you value the company's ability to extract value from the employees over the employee's right to a livable wage?

You can say the employees signed on to this at a known wage, but the employers signed on to pay as little as possible, too.  Business is a constant adjustment, and business models must adjust or die.

Maybe he can become a draftsman or somesuch now.

[ChrisL]

6 minutes ago, 12string said:

It won't be long before they hire them back, and raise their prices to cover it.  Or, shut down because 2 people can't keep up.  Right now, it's an employees' market, so those $20 rates are here to stay.  It will  straighten itself out, and low income workers will benefit greatly.  Finally.

It's also about time we pay waitstaff the full $20- and stop tipping to make up the difference

 

10 minutes ago, Randomguy said:

I am sure we can all go without cookies all the time, I am already too fat.  All these 'business' people need to pull themselves up by their bootstraps and not jump into opening businesses that exploit the poorest people out there.  

They need to change their business model or pivot to a different business.

So a potential fall out is higher wages but fewer jobs as business that didn’t pivot or sold items RG didn’t approve of tank… It will be interesting to see how this shakes out.

[Kirby]

I went to a Chipotle near my grocery store to pick up lunch and they had  a sign on the door that all orders had to be placed and paid for with the app.   There was no in store ordering. They still had employees for cooking, but no cashiers.   Orders were placed on shelves for pick up.  Since I rarely go to Chipotle and didn't feel like downloading an app, I just left but they still seemed pretty busy

A lot of kids in my high schools got their entry level jobs as cashiers at fast food places or grocery stores.  I suspect they'll be fewer of those jobs in the future. My local CVS went from 3 checkout lanes to 1 and 4 self check outs.

[Randomguy]

23 minutes ago, ChrisL said:

So a potential fall out is higher wages but fewer jobs as business that didn’t pivot or sold items RG didn’t approve of tank… It will be interesting to see how this shakes out.

CA has determined that its long-term interests are better served by having a more livable minimum wage.  If poorly suited businesses tank, they tank and nobody should cry for them.  It isn't about me or anyone else approving or you or anyone else disapproving, it is about the conditions as they now are.  Adapt or die.  Can't adapt?  Tough shit, someone else will.

Honestly, I feel pretty good whenever I hear about a higher wage for society's least compensated workers, who mostly will never have capital to participate in capitalism, except the getting shit on part.

[ChrisL]

8 minutes ago, Randomguy said:

CA has determined that its long-term interests are better served by having a more livable minimum wage.  If poorly suited businesses tank, they tank and nobody should cry for them.  It isn't about me or anyone else approving or you or anyone else disapproving, it is about the conditions as they now are.  Adapt or die.  Can't adapt?  Tough shit, someone else will.

Honestly, I feel pretty good whenever I hear about a higher wage for society's least compensated workers, who mostly will never have capital to participate in capitalism, except the getting shit on part.

Just a jab on the cookie line, but if we see a collapse of businesses, say even 10% fewer businesses that will mean fewer entry level jobs as well.  Or maybe other businesses will step up.

Like we said, it’ll be interesting to see how this shakes out. 

[sheep_herder ★]

51 minutes ago, ChrisL said:

My son let me know yesterday that with the state mandated $20 an hour increase coming April 1st for fast food workers, his employer (chain cookie store) let go all of the HS kids and have cut back staffing.  It’s mainly him and two other people + the manager.  They had about 10  HS kids who would cover evenings & weekends who were all advised this was their last week. 

He said it’s really tough as he often has to work by himself so baking & counter work results in longer lines.  I have also seen reports of lay offs & reduced staffing at eateries.

Many lauded the move to higher wages and I’m not opposed to them, but at what cost?  I think if people thought businesses wouldn’t reduce staff to cover raising payroll costs they were pretty naive. 

Many people do not look very far ahead and consider the consequences. See it all the time, when they vote down taxes and then wonder when their services disappear. Classic example was when Oregon folks voted down some tax, following the example set by California, and then folks in our town could not figure out why the snow plows were not running as much that winter. We just shook our heads.

[BR46]

58 minutes ago, Airehead said:

I figured they would just raise prices

But it gets to the point where nobody will buy you products because it's too expensive. 

[sheep_herder ★]

52 minutes ago, Airehead said:

I figured they would just raise prices

A lot of jobs were lost in Arizona back in the 70s with the gasoline crunch. Folks found they could operate with less help and make more money.

[shootingstar]

@ChrisL  how long has he been with firm? He has a whole future ahead of him.  He needs to try a different line of work.

[Randomguy]

2 minutes ago, ChrisL said:

Just a jab on the cookie line, but if we see a collapse of businesses, say even 10% fewer businesses that will mean fewer entry level jobs as well.  Or maybe other businesses will step up.

Like we said, it’ll be interesting to see how this shakes out. 

I think other businesses will pick up, or people will simply start their own small businesses.  Everybody has to do the math when they start something.  There will be plenty of entry level jobs if the business model can support them.

I have made the point before that the folks who were working two full time jobs and having another part time job just to pay rent can cut back the number of jobs they need to work to survive.  meaning more jobs available, not less in many situations.  Nobody should be expected to scrape by their whole lives while not having the time, money, or energy to see their families or improve their situations just so some jackhole or other can save a quarter on their McGriddle, if you want to blame the consumer for this mess.  Really though, it may be that the owners of the companies are now trying to twist us all around and vote this stuff back so they can spend another month in the Swiss chalet before they go to the Italian coast in the summer, all on the backs of everyone they can take advantage of.

Just now, BR46 said:

But it gets to the point where nobody will buy you products because there too expensive. 

Adapt or die.  If someone wants that cookie, they will pay for it or learn to get off their butts and make their own cookies.  

[Kzoo]

8 minutes ago, Randomguy said:

or people will simply start their own small businesses. 

And those people can hire others at less than minimum wage.  It's a vicious cycle.

 

 

[Randomguy]

2 minutes ago, Kzoo said:

And those people can hire others at less than minimum wage.  It's a vicious cycle.

Less than minimum wage is not allowed, they will have to pay at least that to compete for good workers.  Society benefits when companies have to do that, as wages go up across the board.  Well maybe the folks at the top will have to stop having avocado toast every day, pull bootstraps, and all the other silliness you hear.   I am not worried about it, other than minor adjustments that we all have to make.   The AI stuff is much more likely to throw society in the crapper than livable wages.

[12string]

1 hour ago, ChrisL said:

So a potential fall out is higher wages but fewer jobs

There are well over 1 million more open jobs than there are people seeking jobs.  Most of them are in the lower income jobs. 

It will increase the cost of some things.  But a small price to pay to lift so many out of poverty.  

[Randomguy]

I like cookies.

[Randomguy]

This is not my cookie, but they have cost more than $5 forever.  Now I want one, thanks Chris!  

[MickinMD ★]

3 hours ago, ChrisL said:

My son let me know yesterday that with the state mandated $20 an hour increase coming April 1st for fast food workers, his employer (chain cookie store) let go all of the HS kids and have cut back staffing.  It’s mainly him and two other people + the manager.  They had about 10  HS kids who would cover evenings & weekends who were all advised this was their last week. 

He said it’s really tough as he often has to work by himself so baking & counter work results in longer lines.  I have also seen reports of lay offs & reduced staffing at eateries.

Many lauded the move to higher wages and I’m not opposed to them, but at what cost?  I think if people thought businesses wouldn’t reduce staff to cover raising payroll costs they were pretty naive. 

In some countries including France, there's a different minimum wage for school-age teenagers, adult workers, and retirees working full or part time.

When I was young, a minimum wage was typically what you earned for the first 3 months to a year until you showed you could do the job, then you got a raise.

If that was true today, they could start lower minimum wages.

[maddmaxx ★]

3 hours ago, ChrisL said:

So a potential fall out is higher wages but fewer jobs as business that didn’t pivot or sold items RG didn’t approve of tank… It will be interesting to see how this shakes out.

Higher wages and fewer jobs and higher prices and some failed business's which means fewer jobs.  Eventually instead of 6 pizza shops in town there will be one with an hour wait and customers will learn to make their own pizza.  That one pizza shop will stay in business because there will be people with 6 figure incomes willing to pay $50 for a pizza.  There will probably be a housing lottery in town for those forced out by the 6 figure incomes.

[Randomguy]

22 minutes ago, maddmaxx said:

Higher wages and fewer jobs and higher prices and some failed business's which means fewer jobs.  Eventually instead of 6 pizza shops in town there will be one with an hour wait and customers will learn to make their own pizza.  That one pizza shop will stay in business because there will be people with 6 figure incomes willing to pay $50 for a pizza.  There will probably be a housing lottery in town for those forced out by the 6 figure incomes.

So no different than now?  They have been predicting society's downfall since the first minimum wage was enacted, and it has been no different at any of the adjustments.  It is always "Oh, poor businesses, all will fail, the sky will fall..."  

I am not buying it.

[ChrisL]

2 hours ago, 12string said:

There are well over 1 million more open jobs than there are people seeking jobs.  Most of them are in the lower income jobs. 

It will increase the cost of some things.  But a small price to pay to lift so many out of poverty.  

Again I am not against the idea of higher wages but $20 in SoCal is still poverty.  It’s not a living wage.  To do that you would need to pay at least double that. 

[12string]

15 minutes ago, Randomguy said:

So no different than now?  They have been predicting society's downfall since the first minimum wage was enacted, and it has been no different at any of the adjustments.  It is always "Oh, poor businesses, all will fail, the sky will fall..."  

I am not buying it.

Yeah, we've been doing this capitalism thing for a while.  It was working out pretty well until the 80's, when the deck got stacked in favor of the wealthy business owners.

Now we're taking some of those cards off the bottom and giving them back to to workers.  Some businesses won't figure out how to make it work and will close.  And the workers will find other jobs.

Coming out of COVID, restaurant workers saw a quite large increase in income, amidst warnings that restaurants were all going to go out of business because of it.  Some did.  The rest are understaffed, trying to hire, and offering even more pay.

Our economy is the best it's been since post WWII.  We can handle paying poor folks enough to feed themselves.  Incidentally, that boom also saw better wages for lower classes.

[12string]

5 minutes ago, ChrisL said:

Again I am not against the idea of higher wages but $20 in SoCal is still poverty.  It’s not a living wage.  To do that you would need to pay at least double that. 

And THAT is a whole 'nother issue.  Not sure that anyone has an answer to it.  

But at least they aren't trying to live in SoCal on $8 and hour.

We were just discussing the free busses in Baltimore.  all over downtown.  Where the rich people live and tourists show up with disposable income.  The poor people who work there?  They have to PAY for a bus to get from work to almost affordable housing.  We do a lot of things backwards.

[maddmaxx ★]

The problem with increasing the wage of fast food workers is that the associated price increases have the most effect on the poor and low middle class, pushing them lower.

Folks with 6 figure incomes like these sorts of ideas because they can afford to,

[ChrisL]

53 minutes ago, Randomguy said:

So no different than now?  They have been predicting society's downfall since the first minimum wage was enacted, and it has been no different at any of the adjustments.  It is always "Oh, poor businesses, all will fail, the sky will fall..."  

I am not buying it.

There is a balance of what businesses can afford to pay vs what employees deserve to earn.  Personally I believe fast food and small businesses will be impacted, actually severely impacted by the mandated $20 wages.  OK great, the entry level worker will earn more but when your local bagel shop closes or ordering a burger becomes a PITA and people stop coming then what? Adapt or die?

It’s not just the corporate fat cats who are going to suffer, it’s the mom & pop business owners who will feel this the most.  

[ChrisL]

4 hours ago, shootingstar said:

@ChrisL  how long has he been with firm? He has a whole future ahead of him.  He needs to try a different line of work.

He’s been there a year and is one of the few that is staying & benefiting from the higher wages.  He’s looking though.  Yeah he’s committed to food/restaurant industry so we’ll see.   What anyone thinks he should do is a lost cause on him, he’s going to do what he’s going to do.  We saw that in him early on. 

[ChrisL]

52 minutes ago, 12string said:

And THAT is a whole 'nother issue.  Not sure that anyone has an answer to it.  

But at least they aren't trying to live in SoCal on $8 and hour.

We were just discussing the free busses in Baltimore.  all over downtown.  Where the rich people live and tourists show up with disposable income.  The poor people who work there?  They have to PAY for a bus to get from work to almost affordable housing.  We do a lot of things backwards.

Just a little perspective, the CA minimum wage is $15.50 an hour.   
 

[Ralphie ★]

1 hour ago, 12string said:

Yeah, we've been doing this capitalism thing for a while.  It was working out pretty well until the 80's, when the deck got stacked in favor of the wealthy business owners.

Speaking of 100 years ago, this just seems like a repeat of the gilded age to me. 

[Dottleshead ★]

Fact is the younger generation is screwed.  I don't see any of them being able to afford their own homes and -- retirement??       No matter how you argue the politics -- these people are effed.

[maddmaxx ★]

3 minutes ago, Dottleshead said:

Fact is the younger generation is screwed.  I don't see any of them being able to afford their own homes and -- retirement??       No matter how you argue the politics -- these people are effed.

If you look at the numbers, the middle class is collapsing.

The middle class, once the economic stratum of a clear majority of American adults, has steadily contracted in the past five decades. The share of adults who live in middle-class households fell from 61% in 1971 to 50% in 2021, according to a new Pew Research Center analysis of government data.

[Dottleshead ★]

Just now, maddmaxx said:

If you look at the numbers, the middle class is collapsing.

The middle class, once the economic stratum of a clear majority of American adults, has steadily contracted in the past five decades. The share of adults who live in middle-class households fell from 61% in 1971 to 50% in 2021, according to a new Pew Research Center analysis of government data.

That's for sure.  They want a system of haves and have nots and throw those poor desperate bastards in prison.  Oh and be sure to invest in the firms creating the prisons.  It's a win-win!

[Kzoo]

2 minutes ago, Dottleshead said:

That's for sure.  They want a system of haves and have nots and throw those poor desperate bastards in prison.  Oh and be sure to invest in the firms creating the prisons.  It's a win-win!

Who is they?

Do you vote?

Do you have a 401k invested in organizations run by ‘they’?

 

So many questions, so few answers.

[Dottleshead ★]

2 minutes ago, Kzoo said:

Who is they?

Do you vote?

Do you have a 401k invested in organizations run by ‘they’?

So many questions, so few answers.

They == Haves. 

Don't play dumb Kazabooboo.  Yes, I have.  But I'll never be complete until I have your stuff. Geez.

[Kzoo]

2 minutes ago, Dottleshead said:

But I'll never be complete until I have your stuff. Geez

You can aim much higher…

[Dottleshead ★]

Just now, Kzoo said:

You can aim much higher…

Thanks for the heads up.  But your stuff would mean so much more.  I would not sell it.

[ChrisL]

26 minutes ago, Dottleshead said:

Fact is the younger generation is screwed.  I don't see any of them being able to afford their own homes and -- retirement??       No matter how you argue the politics -- these people are effed.

Sorry but I don’t buy that narrative, at least not in broad sweeping terms.   I’m a firm believer you can be successful, have the home & retirement.  You have to make the right choices and take advantage of opportunities and work hard but kids today can do it. I see it now with one of my kids and with the young people I work with.  
 

[Wilbur ★]

33 minutes ago, Dottleshead said:

Fact is the younger generation is screwed.  I don't see any of them being able to afford their own homes and -- retirement??       No matter how you argue the politics -- these people are effed.

I think they will really have to temper their expectations or move to a lower cost part of the country.  It will definitely be tougher for them than previous generations. 

[Wilbur ★]

1 hour ago, Ralphie said:

Speaking of 100 years ago, this just seems like a repeat of the gilded age to me. 

It effectively is.  The paupers prospered and built a middle class and the elites have found their way to take it all back. 

[Wilbur ★]

3 hours ago, maddmaxx said:

Higher wages and fewer jobs and higher prices and some failed business's which means fewer jobs.  Eventually instead of 6 pizza shops in town there will be one with an hour wait and customers will learn to make their own pizza.  That one pizza shop will stay in business because there will be people with 6 figure incomes willing to pay $50 for a pizza.  There will probably be a housing lottery in town for those forced out by the 6 figure incomes.

BINGO

[Ralphie ★]

22 minutes ago, Wilbur said:

I think they will really have to temper their expectations or move to a lower cost part of the country.  It will definitely be tougher for them than previous generations. 

I think one problem with that is covid and remote work sort of leveled out the cost of living across the country, to some degree more than it was. 

[Dottleshead ★]

29 minutes ago, ChrisL said:

Sorry but I don’t buy that narrative, at least not in broad sweeping terms.   I’m a firm believer you can be successful, have the home & retirement.  You have to make the right choices and take advantage of opportunities and work hard but kids today can do it. I see it now with one of my kids and with the young people I work with.  
 

I'm not saying it can't be done but I'm also willing bet that those that can afford houses get help from mommy & daddy for their down payment for a house.  The average home here in poduck Bellingham is $626,137. So you could put a down payment at one of the worst possible rates at 5% or roughly $30k of that average home. Many, if not most, cannot afford this.  I can tell you the average salary in B'ham is $50k.  https://www.ziprecruiter.com/Salaries/-in-Bellingham,WA

In the meantime, the average rental price (they gotta live somewhere while they "save") is $1995 https://www.zumper.com/rent-research/bellingham-wa. 

Sorry but that's not an equation that works for a fluent path towards home ownership.  It's not a matter of selling off the jet skis.  There are other areas of the economy within the country that are better examples perhaps, but I claim this view I just presented is probably more accurate than other areas of the country that may be favorable.

[ChrisL]

2 hours ago, Dottleshead said:

I'm not saying it can't be done but I'm also willing bet that those that can afford houses get help from mommy & daddy for their down payment for a house.  The average home here in poduck Bellingham is $626,137. So you could put a down payment at one of the worst possible rates at 5% or roughly $30k of that average home. Many, if not most, cannot afford this.  I can tell you the average salary in B'ham is $50k.  https://www.ziprecruiter.com/Salaries/-in-Bellingham,WA

In the meantime, the average rental price (they gotta live somewhere while they "save") is $1995 https://www.zumper.com/rent-research/bellingham-wa. 

Sorry but that's not an equation that works for a fluent path towards home ownership.  It's not a matter of selling off the jet skis.  There are other areas of the economy within the country that are better examples perhaps, but I claim this view I just presented is probably more accurate than other areas of the country that may be favorable.

 

2 hours ago, Wilbur said:

I think they will really have to temper their expectations or move to a lower cost part of the country.  It will definitely be tougher for them than previous generations. 

See I disagree with this.  The point you two are missing is the same thing that’s happening to food service workers out here.  Wages across the board are much higher.  My daughter makes as much as I do now and she’s 30.  She’s chosen a field that pays well, excels and is a manager.  My SIL earns as much as her. He’s a tax accountant & CPA.

Not only can it be done, it is being done.  My daughter & SIL bought their townhouse in their late 20’s and we didn’t help them.  I just don’t buy the narrative the youth are screwed.  The lazy, uninformed slacking youth is but that was the case with every generation.  

I still believe there is a path to wealth in America.  You just have to work your ass off to get it. 

[Dottleshead ★]

32 minutes ago, ChrisL said:

You just have to work your ass off to get it. 

This is my path. Looking back it was not easy and required a LOT of sacrifice. 

I'm not unique but I do think my tenacity falls within the group you speak of.  Not everyone has that.  It's inside and in a deep place that I can draw from.  Very much like my 60lbs in 6 months.  But I know most folks don't have that and I also came through a time when things were more affordable.  I'm a six figure income earner and have been for some time now and just above the economic curve.  I know most folks out there are not 6 figures.  I understand though that the California economy is not the same as Washington's.  I'd be earning probably another 50% more if I was in the Bay Area, for example. Mainly because everything else down there is insanely expensive.  I just don't think you can say that because 15-20% of us have that 'drive' that you can say it's not bad.

 

I think it's OK to disagree, and you're probably right and I'm probably right, and I think we agree it's not doom and gloom for everyone. But I definitely fall into the camp that it's more doom and gloom for the majority.

 

I can say I'm glad I don't have to start now.

[Wilbur ★]

24 minutes ago, ChrisL said:

See I disagree with this.  The point you two are missing is the same thing that’s happening to food service workers out here.  Wages across the board are much higher.  My daughter makes as much as I do now and she’s 30.  She’s chosen a field that pays well, excels and is a manager.  My SIL earns as much as her. He’s a tax accountant & CPA.

Not only can it be done, it is being done.  My daughter & SIL bought their townhouse in their late 20’s and we didn’t help them.  I just don’t buy the narrative the youth are screwed.  The lazy, uninformed slacking youth is but that was the case with every generation.  

I still believe there is a path to wealth in America.  You just have to work your ass off to get it. 

So, can I send them to America?  

Our entry level housing her is 1.2 million.  Rent is over $3000.  Job security is questionable. Inflation is insane and pretty much everything here eats up 30% more post tax dollars than in the US.  It is a tough gig for youth here right now. 

[Dottleshead ★]

3 minutes ago, Wilbur said:

So, can I send them to America?  

Our entry level housing her is 1.2 million.  Rent is over $3000.  Job security is questionable. Inflation is insane and pretty much everything here eats up 30% more post tax dollars than in the US.  It is a tough gig for youth here right now. 

I'll be honest.  I don't know how you guys do it either.

[ChrisL]

13 minutes ago, Wilbur said:

So, can I send them to America?  

Our entry level housing her is 1.2 million.  Rent is over $3000.  Job security is questionable. Inflation is insane and pretty much everything here eats up 30% more post tax dollars than in the US.  It is a tough gig for youth here right now. 

Pretty comparable to SoCal, their tax rate is likely lower but probably pay more for medical.  Jobs are always plentiful here though.  

WoChrisL and I were looking at a single family home yesterday a few blocks away. A screaming deal at 1.1 M… Our neighbors are listing their place, asked  $950K and got 3 offers the weekend they showed it… They remind me a lot of our kids too. Young couple, two kids and somehow they were able to buy a townhouse and are upgrading to a larger house.