On the eve of the scheduled start to the state legislative session, Governor Dan Malloy was in Bridgeport Tuesday afternoon to propose an increase in the state’s minimum wage. From Mark Pazniokas, CT Mirror:
Gov. Dannel P. Malloy wants Connecticut to be the first state to commit to meeting President Obama’s goal of a $10.10 minimum wage, proposing a series of increases Tuesday that would reach the mark on Jan. 1, 2017.
Malloy’s election-year proposal would renew a debate that seemed settled in Connecticut, where legislation he signed last year increased the minimum to $8.70 this month and calls for a boost to $9 next January.
But the governor’s proposal would amend next year’s increase to $9.15, then commit the state to hitting $9.60 in January 2016 and $10.10 the following January.
“There is a debate happening across our country on how to tackle the growing income inequality that is detrimental to our middle class families and those who aspire to be middle class in our country,” Malloy said. Part of that debate, he said, is ensuring “a good and decent wage.”
Full story here.
*** $10 an hour minimum wage should be passed by July 1st 2015, what’s the big holdup already? ***
The holdup is always the Republicans. Ask David Walker where he stands on the minimum wage.
Jeez, were the Republicans on the Grassy Knoll too?
I am a Democrat. Just for reference’s sake.
The last time I checked, gridlock takes two parties. One that wants its way, and one that is not letting the other party get its way. I wish there were no perennial Party pissing match. The sad reality is many from both parties in our State Senate and house as well as US Congress think their job is to block the other party. This includes Democrats. Do your job, folks. Represent the People, not your Party.
I should create the “Why Can’t We All Just Get Along Party.”
Speedy question! At what point is a minimum wage no longer a minimum wage? Whatever that point is in your opinion, can you convincingly argue your point?
For the sake of argument, let’s make believe I’m the owner of a company that manufactures and sells Godiva2012 (where’s my best girlfriend by the way?) Chocolate. I have six employees: Mojo Momoney, Steve Ourbank, Hector Diesdolares, Lennie Greedmoney, Follow D. Money, and Dollarbill Finch–working for me. Everyone at some point does the same work at different pay levels according to how long they’ve been working for my company. Hector, Lennie and Follow are paid $10.10 per hour and the rest are paid the minimum wage of $8.10. The economy is bad, the business is barely making payroll, the owner hasn’t drawn a paycheck in four months. All the employees are thankful to have a job.
One day, State Representative Eaziersaidthandone Santiago comes up with the idea of raising the minimum wage from $8.10 to $10.10 in two years. The National Economy continued to drag along in the same direction as the prior four years and the full minimum wage law kicks in. Mojo, Dollarbill and Ourbank are now earning the minimum wage of $10.10. Hector, Lennie, and Follow are still getting paid $10.10 as I just can’t afford to pay them more. Two years before the minimum wage increase forced upon me by the state, I had 3 employees earning minimum wage. Two years after the minimum wage increase and giving 3 of my newest employees raises in order to comply with state law, I have 6 employees working for minimum wage.
Now I have 3 employees demanding a raise because they are working for minimum wage. It really broke my heart when I had to call Dollarbill Finch into my office and hand him the pinkslip in order to give Hector, Lennie, and Follow a pay raise.
What he said!
Joel’s private-sector example doesn’t comply with his City of Bridgeport job history. In your dreams you fired the mayor. In reality, you gave him “maximum wages” during his last campaign in order to keep your job.
I may not be in agreement with this example, but I do agree no matter how convoluted people “in the know” and armchair economic “experts” try to make it, it is SIMPLY NOT THE RIGHT ECONOMIC CLIMATE for a minimum-wage increase. The more control government takes regarding how much businesses pay employees, the fewer employers there will be. The minimum wage should be increased, just not now when we are desperate to keep small businesses in business.
It’s counter-intuitive. Not complex. But then again, it is an election year.
Joel, what you described is known as wage compression. When an employer experiences a sudden increase in payroll cost with no significant performance improvement, the result is usually a reduction in the workforce. Then the busy owner gets blamed for being greedy and Democrats try to concoct some other way to pander to their voter base.
What he said!
Most people earning minimum wage are barely making it and are frequently on SNAP or other government programs. I find it hard to feel sorry for employers who don’t care if their employees are living in abject poverty. Without these employees, they wouldn’t have a business.
No company HAS to pay a livable wage, they have to pay the Federal Minimum. If a certain job requires very little skill, you get paid MINIMUM. Instead of the people who make $8 an hour while working 35 hours a week whining about a livable wage, maybe they should get another part-time job and work say … 50 hrs per week. Most people who make a decent wage, say $45-55k a year try to get as much OT as possible and work about 50 hours a week. Just like our parents and grandparents have done, WORK!
I’d rather have sandpaper scraped across my knuckles than hear about wage compression. In 2014, the best way to achieve your maximum wage is to create your own job. Here’s the exciting part: there’s nothing minimum about it.
Joel, in a perfectly elastic economy where everything is subject to strict supply and demand, then your example may prove true. However, that is not the way our economy works.
The reason most businesses complain about minimum wage is they know a portion of the increased wages is going to come from profit. And they don’t like that.
In your example above if half your employees are being paid minimum wage, you have a poor business model to begin with.
But given your numbers and assuming all employees are full-time, this works out to $240 a week. If you are a successful LLC you are probably being taxed at around 38%. This means federal and state income taxes underwrite this increase somewhat, after taxes your weekly cost is $149. Why is your only solution to this dilemma firing people? And if you fire Dollar Bill you save $404. So while complaining about the increase in minimum wage, you have managed to increase your profits. Well done, Joel!
So what is your solution? No minimum wage at all? No OT? Go back to the days of the sweatshops?
Bob, I have to go to work and will answer your question tonight. One point I was making is raising the minimum wage is a solution that creates other problems. A solution that creates other problems is not a solution.
Joel,
Most solutions will create new problems either seen or unintended. If in order to institute a solution you had to guarantee no new problems then there would be no solutions.
The true test is does the solution help more people than it hurts. If it does then it is a solution.
So Joel, every time Dunkin Donuts raises its price of coffee, their employees are getting a raise? Please.
Part of it goes to an increase in product cost, part to operating costs and to the owner as an increase in profit.
Bob,
Joel provided a real-life example as a model to consider. In it he indicated the owner (in your example he will be the LLC member who becomes taxable) has not paid himself for four months. In private businesses the owner is the last to be paid so that situation is not unusual when the economy in general or an industry specifically is going through a downturn.
Such an owner is not sitting around listening to the politicians posture and the legislatures create new mandates. That person continues to battle for opportunities to sell his goods or services in a competitive economy at a price and cost that will leave something available to him and his family (and other working owners) at the end of the day. It is not easy. It is not guaranteed. Many people fail, but the challenge remains. Legislatures do not routinely vote their constituents to prosperity, do they? Time will tell.
And he will benefit if the business succeeds and the employees in many cases are still struggling to get by. And I find it hard to believe a Micky D’s franchisee would go out of business if they had to pay their employees $10 an hour which in CT is not a huge income.
Bob, going back to sweat shops does indeed seem to be the goal of many conservatives. What is really almost criminal is the same people who want substandard wages for fast-food workers are also against food programs like SNAP for the same people. Go into any supermarket in this country and a huge number of the people using SNAP cards are gainfully employed, if you can call being paid starvation wages “gainfully.”
Well then, John,
Half of his employees are a minimum wage.
Hasn’t paid himself in four months.
His problem isn’t minimum wage.
His business is going under unless he figures out the root cause of his problems.
And I would argue PART of the root problem is government has moved from stepping in to stop real social injustice where it was appropriate–and now wants to be seen as Robin Hood and redistribute all of our money, or wealth as it is now being worded, it seems to have become the beast that cannot be satiated. Granted, there are many tax loopholes that need to be closed. Off-shore tax havens for corporate profits is a major one Our congressman Himes is on a committee that has the muscle to move closing this loophole forward, yet it does not happen–why? Putting the burden on small-business owners to pay more than they can afford, and punishing them financially for making a profit or breaking even just does not seem either fair and is punitive to the type of business that makes our middle class expand. While there are no easy or one answer that will work 100%, any burden imposed by our government must first pass the least-punitive test.
We are subsidizing low-wage employers like McDonalds who rarely even give their employees benefits such as health insurance or enough of an income for a decent diet without needing SNAP. Sorry if your hamburger might cost a little more.
And furthermore Henry Ford who was certainly no liberal raised the wages of his employees to the consternation of other local businessmen and actually made more money as his employees and those of competitors and even other businesses had more money to spend … on all sorts of things … such as automobiles.
Yes Dave, and to your point, he did it because it was good business practice for him and his business, not because it was a law.
I would hardly classify McDonalds as a small-business owner. However, I am saving loose change for my next Big Mac Attack just in case. 🙂
Bob,
Most wise of you to understand paying 38% income tax rate as you originally suggested was not one of his problems. But I guess you know that already, no? Time will tell.
How about we make the minimum wage voluntary? But if the business owner decides not to participate then they must make full disclosure of the salaries paid to business owners and their families. They must make full disclosure of the value of benefits they receive for themselves and family members as well as the average benefits paid to low-wage-earning employees. And while they are at it they can disclose capital disbursements paid to owners et al.
Watch how quickly they will howl and then increase wages to their lowest-paid employees.
Bob, last I checked this was not a socialist state. BTW how many of these fast-food workers are second incomes for their families while the other spouse is the main income worker?
Just wondering if anybody who has posted a comment on the step increase of the minimum wage to $10.10 per hour over the next three years works or lives on the State of Connecticut minimum wage of $8.70 per hour now??? Just wonder what it’s like to live on $8.70 an hour.
You know they all make more than minimum wage. They posted on this site. They can all read and write. BTW–McDonalds and Walmart both pay more than minimum wage. It is the mom & pop place that is going to get hit. Not big corporate chains. Find one big corporate chain that pays minimum wage. Look on their web sites. Underemployment.
*** IT’S NOT A MATTER OF MINIMUM WAGE AND HOW MUCH; IT’S A MATTER OF BEING ABLE TO PROVIDE “SIMPLE BASIC NEEDS” IN AMERICA! ***