Minimum Wage

 

Those arguing for a sharp rise in the minimum wage claim you can't live on $7.25 an hour. They're right. You're not intended to live on $7.25 an hour. That's what you pay teenagers who are still living at home. That's what you pay the part-time clerk who just wants to make a little extra money.

 

Any employee worth his salt won't stay at the minimum wage long. He'll be promoted, or he'll build on his experience and find higher paying jobs, or he'll use his ingenuity and come up with a money-making plan. Failing that, he'll moonlight in order to make ends meet.

 

Did you know that the average McDonald's employee generates $2500 a year in profit for the franchise? Do the math. If that worker puts in 20 hours a week, and the wage is raised to Obama's goal of $9, the franchise will have to pay that employee $1820 more a year, not to mention the increase in Social Security taxes. That means he makes only $680 in profit from the labors of that worker. If the worker happens to be full-time, the franchise is out $3640 -- a net loss on that employee of $1140. At what point does the franchise owner say, "It's not worth it. I'll just eliminate that employee."

 

As I've pointed out before, how much are you willing to pay for a Big Mac?

 

"Is it time for a raise? Minimum wage hike a thorny issue." The Dallas Morning News; March 7, 2013; p. 1A.