Forum Post: $25/Hour Minimum Wage = $52,000 Annual Salary
Posted 13 years ago on Nov. 15, 2011, 11:30 a.m. EST by Mach700
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The standard profit is 20% for worldwide industries. If the production cost of product & service is $100, the owners should sell it for maximum $120.
All the companies, factories, offices in the world should earn 20% standard profit only.
From Yahoofinance:
Trade unions in Switzerland claim they have collected enough signatures to force a referendum on a proposal to introduce a minimum wage of 22 Swiss francs ($25) an hour.
That is about twice the minimum wage of 9 euros ($12.40) in neighboring France.
A spokesman for the Swiss Federation of Trade Unions, or SGB, says more than 121,000 people have so far signed the request for a vote.
http://finance.yahoo.com/news/Swiss-unions-push-referendum-apf-2709741278.html?x=0&.v=1
$25 per hour comes to annual salary of $52,000 for a 40 hour week.
USA economy is in recession since year 2005 when inflation adjusted.
Protestors in USA are justified in demanding $75 per hour minimum wage when you consider inflation.
I remember when I would work in a office many years back my salary was 1% of total revenue my company earned from my department.
The maximum expenses for my company was some 40% of the total revenue, So they earned 60% profit and we would work more than 10 hours everyday. I resigned from my job and started my internet business.
Example: Company revenue was $250,000 per month and their maximum expenses were $100,000. So the company earned profit of $150,000 every month from employees hard work.
Sigh. What do you think will happen to prices if the minimum wage is raised to such a level. You seriously need to learn to think systemically rather than locally, just wishing you can click your heels and grant yourself a benefit without consequence.
" What do you think will happen to prices if the minimum wage is raised to such a level. You seriously need to learn to think systemically rather than locally, just wishing you can click your heals and grant yourself a benefit without consequence." it wont do much if quantitative easing is stopped. the classes are at war. we all have our weapons. the poor have protests. the middle have the ballot box and the rich have the fed. can't we all just get along?
Inflation is the friend of the "average joe" when all the money is held by a few and he is deeply in debt. We are in deep debt at the personal, local, State, Federal, and International level. The Federal Reserve has been printing money like crazy on our behalf. See my post at http://occupywallst.org/forum/what-is-money/
Folks who argue for gold are absolutely nuts. If we changed to gold tomorrow, the holders of our debt (including the Chinese ) would have most of it. The rest of us would have insufficient money to conduct routine day-to-day business.
technically, all three that i mentioned, protests, votes, Fed, help the middle class, but mutual respect makes a nation grow. cheers!
how do you spell 65% homeless rate. The real minimum wage is always 0.
If you want to see what an inflationary spiral combined with mass unemployment looks like then implement your idea and you will see.
but....that's the way it is now......
True, we have been seeing, probably, a 40 year inflationary spiral; and unemployment is pretty high. However, do not forget, even though things are bad at times, they can always get worse.
Have you seen the CPI numbers? No it isn't. Implementing a $25/hour min wage will do two things: put large numbers of people out of work and raise prices at an unseen rate. Because it HAS to happen that way.
I never said I agreed, I just pointed out that over inflation and mass unemployment is already an issue......a $25 min wage would be ridiculous, restaurant owners would need to charge $100 or more for a cheesburger just to cover their cooks wages.....
But we don't have mass inflation. Higher than what we're used to unemployment yes, but no real inflation.
No real inflation? Been to a supermarket lately?
Anecdote does not make for global fact. What does the CPI say about food?
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Again, been to a supermarket lately? The price of food is up and has been going up. That's not anecdotal, that's fact.
Yes that is a fact, but we're not paying $200 for loaf of bread, we're paying $2. Hence I don't see what the issue is. Does inflation exist, yes. Do we have rampant on fire inflation, no.
give it some time,food prices have been steadily rising. So has clothing and energy.
That's only because it's so ingrained in society currently that you don't really consciously notice it. However we really have had at least 40 years of continuous inflation. If you study the history of inflation you'll notice that non-inflationary periods tend to have inflation below 1 or even .5, while we are averaging above 3 and at times much higher.
Of course we've had 40 years of continuous inflation. What would you rather have? Stagflation? Deflation? Some inflation in the lower percents, about 3%, is a sign of a healthy economy.
Stagflation is marked by high inflation and little to no growth, it's not quite the same as little or no inflation. Deflation is also quite different. 3% has only been the norm in the last 100 years and is markedly higher than other periods of price revolutions.
See I think 3% would indicate healthy growth. Our economy is growing, we're exporting more and adding more money into the system. As such people have money to spend and inflation occurs.
With a modern economy and proper safety nets that's probably true. However, I cannot recall there ever being a long term period of inflation where real wages have risen equally with inflation(This usually results in instability). Even in the last 30 years there has been a decisive stagnation of wages in comparison to inflation.
I'm too young to remember all of the last 28 years...hint hint
But I don't feel as if the money I have now is worth any less than my parents. I bought a house bigger than my parents on a single salary (albeit with a heck of alot less land, they have 5 acres). The bills are all paid and there's plenty left over for investment and fun. Although I remember gas being $1.29 a gallon, I also remember minimum wage being $5.15 an hour.
Perhaps it's undetectable to the individuals until a consensus among masses of people slowly changes over years. From what I've read of history and economics things like the Arab spring, Occupy Wall Street, collapsing banks, and failing governments like Greece are quite common near the end of long term inflationary periods.
I'm just not sure this all really counts as mass inflation. I mean a loaf of bread is like $2 not $200, which is more like I would expect in a truly rampant inflationary environment.
That's hyperinflation. The mass inflation is merely long term inflation that's mostly undetectable to the people who are living in the time period. It's only real effect can be seen when comparing it to real wages I think.
Though the price of gas has increased at a pace much quicker then food. In the past the cycles of crops where much less stable and food wasn't as easily stored as it is today so prices are cushioned much more from inflation then they were previously.
Real wages vs real buying power........maybe? And then I guess that begs the question, was the level of buying power really sustainable? Or is the level of buying power the average wage earner has now more realistic?
the high price of gas for example is solely due to the inflation of the dollar because of the fractional reserve debt creation system.......if you paid for your gas with gold, it'd be the same price it was 30 years ago.......gold is around $1700-2000 per ounce right now?......see what i'm saying?......but you are right, it's not that bad compared to how bad it could be.......we are just now starting to feel the crunch..........
I don't think gas is all that high. What we pay at the pump has had so much subsidy layered on it, we don't pay anywhere near the true cost of gas.
we do I think, with the trillions we spend on war securing other countries oil....not to mention all the pollution, and lost lives of our troops.....that's a large bill....ouch......
gas was 1 dollar a gallon 10 years ago, an ounce of gold was 250 dollars 10 years ago. No inflation?
Well of course there is inflation of some kind. But you're saying MASS inflation. Our inflation numbers have been less than 1% in recent years.
Inflation is a long term statistic.(The low numbers you are seeing now are a result of the business cycle recession) If you look at inflation starting in 1965, 46 years ago, prices have not doubled; or tripled; or quadrupled; they are now currently 6.93 times their previous levels. This is what is referred to as a price revolution, most notably remembered as times when prices and wages rise quickly, however the lag in real wages compared to inflation is noticed greatest among the middle and lower classes while inequality increases.
Okay, so what is a healthy inflation over 46 years then? 5 times? 4 times?
For items such as food and clothes, it's probably around 1.6 times, remove supply fixing and inflationary expectations and it could be around 1.
Inflationary expectations change for every period, 3% inflation has become a secular concept for most people in this age, however it's not all that healthy as people assume it to be. Inflation in time periods like the Renaissance, the Enlightenment, and the Victorian era were relatively stable and much lower.
That seems to low to indicate a vibrant and growing economy though. I think for the kind of globalized world we live in with lightning fast communications, banking, and business in general; 3% would more accurately reflect health.
I guess just like our technological power, inflation will advance at an ever increasing rate as well.
But why does growth and inflation have to be linked? They haven't always in the past. As countries, economies, markets grow there are new usually new resources or inventions to pour excess money into.
Why do items like food or clothes have to become more expensive even as they become easier, more efficient, and requiring of less labor to produce?
Because people can, and are willing, to pay it. It's why everything goes up in price. As soon as the markets realize people have more money in their pockets and that they are willing to spend it, prices go up. What the item costs to make is completely beside the point. If something only cost me a penny to make but I could charge $100 for it, that's what I'm going to do.
That is the way markets work, but why are people able and willing to pay it when inflation continuously makes it more expensive in comparison to the average wages.
It could be considered that the increase in available credit over the last 30 years has seemed to replace the necessary increases in wages, however that's not inherently stable for an economy or country. That would suggest that growth was merely propped up by credit. It also doesn't address the fact that the price of wages is usually regulated by the demand of labor.
A lot of growth was propped up by credit. (see tuition costs). And mostly because people live in the day to day. They don't stop and think "Hey, 20K for a decent new car seems awfully expensive, I don't see the value and therefore I'm not going to buy at that price". It's more like "I need a new car. How much is my payment gonna be?"
People are stupid I guess is the ultimate and final answer.
Agreed
its comming...
"The standard profit is 20% for worldwide industries."
Where does that figure come from? I believe the average profit margin for US businesses is in the 5% to 8% range, depending on the industry, with some outliers.
This is GREAT news. I love the thought process in this. Mach700 did a great job of explaining it. NOW, here is the real meaning of his post. START YOUR OWN DAMN COMPANY and you will be rich. Go for it. He gave you all you need to know. Happy DAYS!!!!
You know what happens to people who aren't used to having money when they get a shitload of it?.....they overindulge on the things they could never afford, which makes their personal situation even worse, people need to work slowly up the ranks, and get used to managing and having money on the way, otherwise it's like giving a 10 year old $100,000.........they lose all their teeth because they spend it all at the candy store in like, 2 days....
uh.. you have no concept of economics..
and try analyzing at things from beyond the perspective of 'me'
His point is that in order to put up with the stress and technical demands of his job, he needs to be paid far more than what he could make if he was just some schlub working at a Taco Bell. If he could retain more than 50% of his current earnings without the technical demands and stress of being a nuclear reactor operator, he'd simply go work at Taco Bell and enjoy a stress-free life. A far-higher-than-normal salary is the incentive by which demand is created for technically difficult jobs like nuclear reactor operator.
isnt that how things already work?
i dont know any nuclear engineers getting paid what people at taco bell get paid.
(my response was targeted at the OP.. not the nuclear reactor operator)
30/40 years ago the average CEO earned approximately 40 times the wage of the average worker. Today it stands at 343 times. Surely, the way wages are dispersed could be more fair. Providing a living wage would reduce the need for entitlement programs as well as the need for charity. This would not affect prices or profits, only the wealth of the 1%.
Prices should reflect living wages. A culture of consumption based on massive quantity at the lowest price is destructive to society and the environment.
This is not an endorsement of any specific minimum wage rate, but rather the endorsement of a different system of values.
AMAZING... How does one get one of those jobs that pays a MILLION Dollars +??? They are well schooled, smart, work 18 hours a day, etc, etc, etc,... Maybe if I applied myself to that level I could at least get one promotion and be recognized as a good employee. And if motivated, I could start my own company working 12, 14 or 18 hour days, keeping books at night, hiring lazy people to work for me and providing customer service to get new and keep old clients. AM I WILLING??? then no one could fire me. After all the sarcasm, is there any reason why you can't put food on your families table tonight? There are lots of places hiring. Maybe below your level of dignity, but they pay a check.
Ah, but I'll happily take $20/hour if you let me work from home on your computer system. And I'll cost you less, since I won't need a desk, building space, car, etc. Since "home" will be somewhere where the cost of living is lower than your location, I'll be better off, too. You'd be crazy not to accept my offer because that's $5 more an hour for you, and so the inequality starts again. Smart people will always overcome forced equality, because while we are all created equal, we stop actually being equal from the second we're born...
Regardless of what you make minimum wage, that will always define low income/entry level jobs. Entry level jobs are just that, jobs you should start to build a career and work to get a better job. If you cannot get a better job because you are not capable of higher skill level work, they you will probably stay their your whole life. Don't look down on the person who is willing to work 12 hours a day to get ahead. Don't look down on the person who travelled where the job took him. That person may be a Service member. I wanted a better life for my family so I moved to where my job took me, my family followed. Now that I raised my family, have grand kids and a quality life, don't look down on me. God Bless America.
How could a company afford to pay someone 25 hour?
Regardless of what you make minimum wage, that will always define low income/entry level jobs. Entry level jobs are just that, jobs you should start to build a career and work to get a better job. If you cannot get a better job because you are not capable of higher skill level work, they you will probably stay their your whole life. Don't look down on the person who is willing to work 12 hours a day to get ahead. Don't look down on the person who travelled where the job took him. That person may be a Service member. I wanted a better life for my family so I moved to where my job took me, my family followed. Now that I raised my family, have grand kids and a quality life, don't look down on me. God Bless America.
What are the specific actionable steps (not political rethoric) that we want for the OWS movement to meet our goals?
Wow. So, you--or someone--has the right to determine what a company should make in profit? FRIGHTENING.
Also, there is no such thing as standard profit. Please please dont post about business if you've never run one or know nothing about it. Profit margins vary SIGNIFICANTLY by company, product, market, region...etc. "Standard" is non-existent, and setting a maximum is downright scary.
Here we come, Greece...
I'd like to interject a few realities I feel have been overlooked. First and foremost I'd like to point out that Mr. reactor operator, making $45 an hour, no matter how stressful his working conditions are, makes an annual wage which allows him to live a comfortable life, a very comfortable life if he is even moderately frugal. The suggestion that a Taco Bell position is stress free by comparison is as laughable as it is ludicrous. Positions of this nature have traditionally been held by the young, and are a legitimate testing ground for an individuals potential. The very real reason these have been positions for the young is that there is always another young "cog" just waiting to be inserted and thus the mistakes and dalliances with youthful indiscretion, of which teenagers are notorious, have little affect on the day to day operations. For adults who find themselves compelled ( through no fault of their own ) to take these positions there are myriad stresses that someone making $45 an hour has never had to experience from the social stigma of being seen as too lazy to take a more adult position, to the fact that even a managers wage is a dismally small wage for anyone ( not living with mommy ) to try to live on. Secondly. We need to face a simple but very real truth that our society will always and forever have abundantly more low or no skill positions needing to be filled than at the higher end of the pay scale. For some reason we have gotten away from recognizing the worth of those who fill these positions and certain sectors of our society even go so far as to say that people in these positions deserve no better. Shouldn't we instead return to the idea that pride comes from a job well done, and having a job, any job, labels you a productive member of society, valuable and worthy of decent treatment and a living wage? Sorry, but any argument against a living wage for all comes from that mindset which we are all here to protest. Simply stated we need to evolve our thinking away from the tired diatribe " I went to school so that means I deserve more than anyone else" Instead we need to keep our focus on the fact that with existing wage disparities the 99% too often are neglected and live lives filled with the constant sense that impending doom is only an unexpected high dollar expense away. Thirdly. Though I agree that wages must be increased for the 99% to have some modicum of the quality of life that should be available to those of us in the USA, reality is that wage increases alone won't fix anything. If wages are increased the cost of everything goes up proportionately. Thus it would take wage increases and temporary price freezes combined to have a stimulating effect. I know what you're thinking. That this would be a recipe for further recessions as companies would make less profits, and therefore would hire fewer people and perhaps even lay people off. Rubbish. High taxes, unions, and workers benefits have never stopped anyone from getting rich, it just takes a bit longer to get there. Finally, Though we desperately need much higher minimum wages, there are many smaller businesses that just couldn't take that kind of increase in their monthly expenses so there would need to be some kind of subsidy, given directly to the employees of smaller companies,which would bring their take home up to living wage levels. If we can pay oil companies subsidies to explore for oil ( something they would do even without any subsidies ) than we can certainly afford to subsidize small businesses that their workers can share a better life.
"there are myriad stresses that someone making $45 an hour has never had to experience"
A bit presumptuous don't you think? You have no clue what others have gone through to get where they are. I can very comfortably say I know my job is far more stressful than working at Taco Hell. I did after all live through my 20s. Yes, I do live a very comfortable life outside of work, but I've earned it! My point is simply that if I can maintain my standard of living with a much easier job why wouldn't I?
I guess it all depends on you and your perceived pride in a job well done, and the self esteem you garner from your contribution to society. My point, which you obviously missed entirely, is that sure you might deserve the money you make, but it seems that somehow your "right" to make such a salary equates to millions of people who don't deserve a living wage so you can feel comfortable in your superiority. If cash is your sole driving force and reason for living than buddy I think it is the Tea Party you should be hanging with. They are all about me, me me, mine, mine, mine, and screw anybody who gets in the way.
You really need to do a cash flow analysis and you will see that your numbers are WAY off.
Yay everyone can go get the new Porsche 911! I support this plan.
Keep that Socialist shit in Europe...it will NEVER happen here in America.
Do you realize just how much profit you would overnight give to "big oil"?
While the numbers they report are huge, their margins are more along the lines of 6-8%.
I would love that, but then again I own several of the oil companies stocks.
Really though, this kind of thing is just plain silly. How did you manage to come up with it, without seeing the immediate massive harm it would cause, not only to the USA but the rest of the world?
Absolute absurdity. 20% across the board? Rather than fill an entire page pointing out the veiled attempt at "cure all", please consider that business owners have bills which must be paid beyond your simplistic simple salary to margin scenario. I have insurance, lease/mortgage payments, taxes, bonding costs (in some cases), advertising/marketing, electric/gas/water, professional associations, contingency fund, equipment costs/repairs...........................the list goes on, ergo, margins evaporate. I have not even discussed current market conditions relative to the product/service, competition...........
The ironic part about all of this is that I don't think it's a bad thing to pay people more, since we have many things in abundance. If you were to give people a one-time stimulus of 1000 dollars, they will probably blow it, but if you give them 50,000 dollars, they will actually be frugal and plan better for the future. I know a girl who inherited about 50,000 dollars from her grandparents and still works a full time job to keep the money stable. Of course, I don't think this would work without a new way of providing income to people that doesn't depend on the profit that corporations generate, since that is how capitalism works. I also think that if people were to only have to pay a much smaller percentage of their current mortgages, they would devise plans to pay it off much more quickly, but to only have a marginal rate of discretionary spending each month doesn't really justify blowing that on paying down on mortgages. The same goes for student loans. If the loans were 500 dollars or so per semester, then I assume that people would be paying it off rather quickly, but to have it at its current rate justifies people's decisions to put the repayment off. I think this is a sound argument. It would definitely pay to give many people a large bonus, just because, and then it would help tremendously to reduce stress and add to each person's sense of responsibility and proper life management instead of just forcing people to take whatever comes along. And also, if people are to spend these days, they would likely spend on technology, giving more revenues to big companies like IBM or whatever, letting them then use the money to further research and development. They should just be handed money for this sake anyway, since not doing so hinders progress. Of course, the one problem that one inevitably foresees is the releakage of money from the developers and thus to society and then out of the country, which increases national debt. I keep saying this, and I really do mean it, but there needs to be a national currency and an international currency that prevents this from happening and which allows us to focus on our own domestic problems without creating greater international ones. We shouldn't let our progress be hindered by worrying if the money we spend will leak out of the country due to "free trade." I despise free trade.
You are joking right? I earn about $45 per hour (base straight time) as a nuclear reactor operator. If the minimum wage goes to $25 per hour I'm going to need a huge pay raise to put up with the challenges of my job. That means the price of electricity will have go up to keep people doing the hard jobs. If the price of electricity goes up, I'm guessing the price of manufacturing will go up, taxes will go up for street lights... do you get the idea? Please, if you can have a $25 per hour minimum wage and not cause rampant inflation DO IT... I'll go flip burgers for that and live with a lot less stress!
Can I run an extension cord from your place to my house?
IxIxR losses would make that unfeasible!
That's funny. My comment to mynameiscurly on I square R losses is at -3. I wonder if the people hitting "dislike" even know what I square R losses are.
You'd take a 20 dollar per hour paycut to flip burgers? What does a nuclear reactor operator do, sit and watch a nuclear reactor operate? Besides, your job would be obsolete if this country devoted the appropriate resources to solar and wind.
BTW... I can't even begin to describe what I do in terms you would understand. Not insulting you... I'd be using a lot of technical jargon specific to the industry. Reactor operators do not simply turn it on and watch it. While we do have occasional slow days, in general it's much more involved than that.
YES... remember the guy making $25 per hour is now at the bottom of the earning scale. So in our quixotic world of socialism that worker pays no taxes, but the tax slave breaking his ass for $45 per hour pays 1/3 in taxes, so it's only a $5 per hour difference! what a deal.
I hate to burst your bubble, but solar and wind can not make the power this country uses. That's sad, but it's true. I'd love to see more solar power. Wind not so much... bad for birds... unless a bird safe design could be built on a large scale. There are some helical designs that are promising on a small scale. Over the next ten years climate change is going to make my job very very secure... that's also sad but true.
You're right, the people at the bottom pay no income taxes because they are at the bottom, not because they make so little they can barely survive. And those people do pay taxes, every day, they just don't pay income taxes. They don't pay property taxes either, because they don't own property. You probably think their microwave should be taxed as property, that way millionaires could keep a little bit more of their ill-gotten gains. Your distorted worldview is born of your own self-importance and ego. Now go sit and watch that nuclear reactor operate. Must be exhausting.
No I don't think microwaves should be taxed. Please, if my job is so easy.... apply to be a reactor operator. You have no idea what the job involve so pleas don't comment in ignorance.
"The standard profit is 20% for worldwide industries."
Where does that figure come from? My understanding is that profit margins average somewhere between 5% and 8%, with some outliers depending on the particular industry. But if you have better data I would be interested in seeing it.
Just imagine going to a movie and discovering the staff who sell you pop corn are making $52K?
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Technocratic Government
Would you VOTE for it?
A new government that is against capitalism.
Do you know what it is?
Would you be for it?
OSW find a solution for capitalism.
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You're not looking at this right at all. You're using you company's profit margin to justify how much you should be paid? Really? Does the work you do directly affect how much money your company makes? Doubtful. Most jobs are just interchangeable cogs in a machine and if you quit, oh well they'll just get another cog. The price of cogs is based on what the market is willing to pay for that type of cog. So if you're a secretary in Chicago, you can expect to make about $10-$12 an hour and it does not depend at all on how profitable your company is. The job is worth $X and that's what it's worth. That's like saying your car is worth more because you, the driver, work for X company. It doesn't work that way.
If you want to make more, get a skill that commands more in the market place.
agreed.. if you want profit margins, start a company
if you dont want the risks that come with owning a compnay (ie: profit margins can mean losses as well) then get a job working for someone else who is willing to take the risk
its not that hard of an analysis.. jeez, what is it with everyone on thsi board who feels they are 'entitled' to something. you guys are too soft and your parents must have encouraged you too much for achieving the minimum.
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how about we don't ask big brother to get involved and regulate anything? :)
let's let the post office close down
IF there is a demand for paper mail delevery, then some bright young team of fresh minds will take over. how? by paying their employees a reasonable wage. YES that would be about minimum wage.
am I crazy?
Maybe I am. the Post office wouldn't be going broke if it wern't for the unions and the Enormous cost of what is it? 30 million dollars an hour in labor?
well. option 2? let the government subsidize the post office and it comes out of greater taxes and we just keep finding a higher cliff to jump from. (this sounds way too much like obama and I'm against it)
post office crash is just an example but, seems to me that 200 years ago you picked a simple minded honest person you could trust to carry mail around town. it's not rocket science. why are they making $17/hr and up? other businesses will follow, the cost groceries will fall when the corporations don't have to pay $20/hr to Union joe nose picker to stock a shelf or drive a truck. it just may be each individuals own greed that has us where we are today.
if i'm wrong i'm wrong. just seems to me the only way out
Liberals could save the union post offices if they would only sell their computer and buy postage stamps.
Huh? What's your point?
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I didn't say $50 per hour because that would be dishonest. It's within pennies of $45.
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And why do you say that?
Funny how inflation is never a problem in these garage theories. ;-)
I wonder what a frupafreakycuppachino will cost when the kid behind the counter makes $75 per hour.