Day 1292 – $7.50 an Hour

Tuesday, July 30, 2024

The Federal minimum wage is $7.25 an hour. I thought it was $7.50. Let’s do some basic math.

If you work 40 hours a week for 50 weeks, that’s 2000 hours.

At $7.25 an hour that works out to $14,500 a year.

Who can survive on that?

In Virginia where I live the annual cost of living is $48,249 according to SoFi.

That would mean you’d have to make $24.12 an hour to live in Virginia.

At $7.25 an hour, every year you’d fall $34,049 behind.

What do people do?

I don’t know. What I do know is that after World War II a man could get a job that would pay enough to afford a house, feed his family, and his wife didn’t have to work. This is no longer true.

I’ve heard it said that minimum wage jobs are “entry level jobs” and the assumption is that they are for high school kids trying to make a little extra money. This too is not true. The majority of minimum wage jobs are held my people trying to make a living.

“Entry Level Job” suggested that the person will move up and get a better paying job. This too is not true. You only need so many managers at a burger joint or a Walmart. The vast majority will be minimum wage jobs.

And let’s not forget what Chris Rock said of minimum wage jobs, “We’d pay you less but the government won’t let us.”

There have been studies looking at the effect of raising wages and or solving the problem of poverty..

I listened to the radio when NPR was interviewing someone speaking for the idea of having unions and increasing wages. He made several interesting points: 1) After WWII laborers benefitted nationwide from the autoworkers forming a union and receiving better wages. 2) It turns out that raising wages hurts the employer at first, a little bit in the pocket book, but the overall effect is beneficial because they don’t have as much turnover and they get better worker loyalty. Also, the community benefits because people have money to spend. 3) He pointed out that a Walmart executive stated that the reason they didn’t want unions was “they wanted to drive the bus.” ie It’s question of control.

The other report was about the man who created ChatGPT. He’s done an experiment giving people $1000 a month for three years and seeing the effect. Not shockingly, people reduced hour to spend more time with their kids. They spent the money by and large on basics like food, rent, and gas.

Project 2025 wants to do away with the minimum wage, but back on services and benefits for the poor, and create a tax program that will save the rich thousands and cost everyone else $2,600 a year.

This is the program Donald Trump says he’ll put in place.