Trade union and socialist coalition party

Trade union and socialist coalition party

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davepoth

29,395 posts

198 months

Saturday 18th April 2015
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loafer123 said:
Increase min wage, cost of goods/services goes up, less goods/services bought, less people employed, less tax received, more deficit.
Ah, but that's the thing. As it stands, minimum wage earners have to be propped up by the state. That means that there is a level of minimum wage, probably a bit higher than the current level, at which the reduction in state support to the minimum wage earners (and the tax burden that causes to industry) matches up with the increased cost of paying minimum wage earners more.

It's quite likely we could stick a quid an hour or more on to the minimum wage without any impact on tax or prices.

Countdown

39,690 posts

195 months

Saturday 18th April 2015
quotequote all
davepoth said:
Ah, but that's the thing. As it stands, minimum wage earners have to be propped up by the state. That means that there is a level of minimum wage, probably a bit higher than the current level, at which the reduction in state support to the minimum wage earners (and the tax burden that causes to industry) matches up with the increased cost of paying minimum wage earners more.

It's quite likely we could stick a quid an hour or more on to the minimum wage without any impact on tax or prices.
It would be a transfer of impact from "general taxpayers" to shareholders. It seems some think that it's ok to "redistribute" labour costs but not "income".

loafer123

15,404 posts

214 months

Saturday 18th April 2015
quotequote all
davepoth said:
loafer123 said:
Increase min wage, cost of goods/services goes up, less goods/services bought, less people employed, less tax received, more deficit.
Ah, but that's the thing. As it stands, minimum wage earners have to be propped up by the state. That means that there is a level of minimum wage, probably a bit higher than the current level, at which the reduction in state support to the minimum wage earners (and the tax burden that causes to industry) matches up with the increased cost of paying minimum wage earners more.

It's quite likely we could stick a quid an hour or more on to the minimum wage without any impact on tax or prices.
The point is that supporting part of income with benefits is beter than making people unemployed and entirely reliant on benefits.

Increasing the minimum wage by £1 would have a profound effect in some industries.

In hotels, c.40% of revenue goes to pay wages, so £1 would increase the wage bill by something like 10% (not everyone is on the min wage, but most are low skill, low pay) and room rates woukd have to go up by approaching 5%.

TwigtheWonderkid

43,248 posts

149 months

Saturday 18th April 2015
quotequote all
loafer123 said:
In hotels, c.40% of revenue goes to pay wages, so £1 would increase the wage bill by something like 10% (not everyone is on the min wage, but most are low skill, low pay) and room rates woukd have to go up by approaching 5%.
So those £29 rates promoted by Travelodge would rise to £30.45.

It may be low skill, but it's damn hard work preparing hotel rooms. The rates they charge need to be enough to make a profit after paying your staff a decent living wage. If a hotel can't achieve that, then go bust and let someone else have a go.

loafer123

15,404 posts

214 months

Saturday 18th April 2015
quotequote all
TwigtheWonderkid said:
loafer123 said:
In hotels, c.40% of revenue goes to pay wages, so £1 would increase the wage bill by something like 10% (not everyone is on the min wage, but most are low skill, low pay) and room rates woukd have to go up by approaching 5%.
So those £29 rates promoted by Travelodge would rise to £30.45.

It may be low skill, but it's damn hard work preparing hotel rooms. The rates they charge need to be enough to make a profit after paying your staff a decent living wage. If a hotel can't achieve that, then go bust and let someone else have a go.
I am sure you aren't stupid enough to think that most people pay £29 for a hotel room.

The point is more general than that, and hotels is just one example.

The point is people pay more for goods and services and therefore buy less of them, so less people are employed.

Or you being deliberately obtuse because the facts don't fit your dogma?

mph1977

12,467 posts

167 months

Saturday 18th April 2015
quotequote all
loafer123 said:
TwigtheWonderkid said:
loafer123 said:
In hotels, c.40% of revenue goes to pay wages, so £1 would increase the wage bill by something like 10% (not everyone is on the min wage, but most are low skill, low pay) and room rates woukd have to go up by approaching 5%.
So those £29 rates promoted by Travelodge would rise to £30.45.

It may be low skill, but it's damn hard work preparing hotel rooms. The rates they charge need to be enough to make a profit after paying your staff a decent living wage. If a hotel can't achieve that, then go bust and let someone else have a go.
I am sure you aren't stupid enough to think that most people pay £29 for a hotel room.

The point is more general than that, and hotels is just one example.

The point is people pay more for goods and services and therefore buy less of them, so less people are employed.

Or you being deliberately obtuse because the facts don't fit your dogma?
The fact that the low-end value of the yield managed price range for Travellodge is used in the example says quite a bit

TwigtheWonderkid

43,248 posts

149 months

Saturday 18th April 2015
quotequote all
mph1977 said:
loafer123 said:
TwigtheWonderkid said:
loafer123 said:
In hotels, c.40% of revenue goes to pay wages, so £1 would increase the wage bill by something like 10% (not everyone is on the min wage, but most are low skill, low pay) and room rates woukd have to go up by approaching 5%.
So those £29 rates promoted by Travelodge would rise to £30.45.

It may be low skill, but it's damn hard work preparing hotel rooms. The rates they charge need to be enough to make a profit after paying your staff a decent living wage. If a hotel can't achieve that, then go bust and let someone else have a go.
I am sure you aren't stupid enough to think that most people pay £29 for a hotel room.

The point is more general than that, and hotels is just one example.

The point is people pay more for goods and services and therefore buy less of them, so less people are employed.

Or you being deliberately obtuse because the facts don't fit your dogma?
The fact that the low-end value of the yield managed price range for Travellodge is used in the example says quite a bit
But these are exactly the kind of organisations that pay min wage. Bottom line is, if you run a business that needs to employ people, you need to factor in paying them a living wage into your business plan. It's not good enough to say "if I paid them a living wage, I'd go bust." Well fking go bust then and let a better business take your place.

I recall all these arguments trotted out before the min wage was introduced, that it would be carnage for business. It was bks and the world kept on turning.

I can even recall when I first started, business owners saying the cost of soon to be compulsory fire extinguishers would drive them out of business. Just seems ridiculous now, but back in the day, apparently fire safety was a cost that business couldn't take!!

I wonder what would happen if a law was introduced that said any CEO whose firm didn't pay £10/hour min was not able to earn above £100K, Once their lowest paid staff was making £10/hour, the CEO could be paid whatever the firm wanted to pay them. I'd bet you'd find companies would suddenly find a way of paying £10/hour min, so the CEO could continue on £500K/year plus bonuses and pension contributions.

thinkofaname

280 posts

132 months

Saturday 18th April 2015
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TwigtheWonderkid said:
I recall all these arguments trotted out before the min wage was introduced, that it would be carnage for business. It was bks and the world kept on turning.
The only reason that the minimum wage is sustainable is because it is low enough that it doesn't cause too much damage. And it is already quite high by the standards of the developed world. Your suggestion that "better businesses" are waiting in the wings to pay people a "living wage" is fantasy. Where are they now? They could surely attract those workers right now with the better wages that you imagine they can afford to pay.

mph1977

12,467 posts

167 months

Saturday 18th April 2015
quotequote all
thinkofaname said:
TwigtheWonderkid said:
I recall all these arguments trotted out before the min wage was introduced, that it would be carnage for business. It was bks and the world kept on turning.
The only reason that the minimum wage is sustainable is because it is low enough that it doesn't cause too much damage. And it is already quite high by the standards of the developed world. Your suggestion that "better businesses" are waiting in the wings to pay people a "living wage" is fantasy. Where are they now? They could surely attract those workers right now with the better wages that you imagine they can afford to pay.
plenty of businesses paying more than the NMW for their staff in bvaseline level jobs but not necessarily the living wage ...

Johnnytheboy

24,498 posts

185 months

Saturday 18th April 2015
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Increasing the minimum wage to that extent would just induce enough inflation to neutralise the benefit.

mph1977

12,467 posts

167 months

Saturday 18th April 2015
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Johnnytheboy said:
Increasing the minimum wage to that extent would just induce enough inflation to neutralise the benefit.
that is the fundamental problem that doesn't feature in the clause4istas minds , however there is a zero sum game to some degree in that everyone who gets a living wage reduces the tax take because they don;t need HB council tax rebate, tax credits etc etc etc.

thinkofaname

280 posts

132 months

Saturday 18th April 2015
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mph1977 said:
plenty of businesses paying more than the NMW for their staff in bvaseline level jobs but not necessarily the living wage ...
Good for them. But plenty of other businesses genuinely couldn't afford it and would go bust. I know that anti-business types have little problem with evil capitalists going out of business, but they forget that all public services and welfare spending is ultimately funded by profitable enterprise.

powerstroke

10,283 posts

159 months

Saturday 18th April 2015
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davepoth said:
JensenA said:
It's these 'low level' staff (you snobby tt) that keep the country going, look after people in care homes, recycle your rubbish, clean the streets, make the sandwiches that you buy, stock the shelves in he supermarkets, keep the hospitals clean (and your your nice air conditioned offices).
At the moment all these jobs are subsidised by the tax payer, why shouldn't the Employer pay the wage?
I agree. I know a lot of people who are on less than £20k, and they are degree qualified and doing quite technical work. The job market really is a little bit broken at the bottom at the moment and I can't help but wonder if tax credits have got something to do with it. Upping the minimum wage so that a "standard" family with two full time minimum wage earners doesn't need topping up seems to be quite a sane idea really - there's little point in having a minimum wage if it's effectively below the minimum.
Surely its just the symptom not the cause!! migration is why wages are depressed , until that nettle is grasped we will need tax credits...
L

JensenA

5,671 posts

229 months

Saturday 18th April 2015
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Businesses pay the minimum wage because they can get away with it. Its the minimum they can pay someone, so that's why they pay it, they'd probably pay less if they could, but they'd be breaking the law. If these businesses gave their minimum wage staff a 10% pay rise it would cost them an extra £25 per employee, and that would make the company go bust??
Remember these low skill scum of the earth people, are human beings who rather than sit at how. And take benefits, and probably be better off, have got off their asses and are actually trying to make a living, so give them some credit, and stop treating them as Human 'Resources'. - god how I hate that term.

mph1977

12,467 posts

167 months

Saturday 18th April 2015
quotequote all
powerstroke said:
davepoth said:
JensenA said:
It's these 'low level' staff (you snobby tt) that keep the country going, look after people in care homes, recycle your rubbish, clean the streets, make the sandwiches that you buy, stock the shelves in he supermarkets, keep the hospitals clean (and your your nice air conditioned offices).
At the moment all these jobs are subsidised by the tax payer, why shouldn't the Employer pay the wage?
I agree. I know a lot of people who are on less than £20k, and they are degree qualified and doing quite technical work. The job market really is a little bit broken at the bottom at the moment and I can't help but wonder if tax credits have got something to do with it. Upping the minimum wage so that a "standard" family with two full time minimum wage earners doesn't need topping up seems to be quite a sane idea really - there's little point in having a minimum wage if it's effectively below the minimum.
Surely its just the symptom not the cause!! migration is why wages are depressed , until that nettle is grasped we will need tax credits...
L
not with technically qualified roles - a lot of that is still the result of Labour's mismanagement of the economy 1997 - 2010

markcoznottz

7,155 posts

223 months

Saturday 18th April 2015
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Irrespective of the minimum wage immigration IS the main factor for supression of wages in hotels, hardly any british people work as cleaners etc in hotels now. Welcome to a service based economy.

mph1977

12,467 posts

167 months

Sunday 19th April 2015
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markcoznottz said:
Irrespective of the minimum wage immigration IS the main factor for supression of wages in hotels, hardly any british people work as cleaners etc in hotels now. Welcome to a service based economy.
far too much like hard work for the average member of the 'working class' ... the numbers of native britons cancelled off Agency work (by British bosses ) in various places bares that out ...

anonymous-user

53 months

Sunday 19th April 2015
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loafer123 said:
Increase min wage, cost of goods/services goes up, less goods/services bought, less people employed, less tax received, more deficit.
Sorry thats hopelessly simplistic. That money hasn't disappeared, those earning it will spend it right back on other goods and services.

What evidence is there that the minimum wage has anything to do with Europes employment woes?

anonymous-user

53 months

Sunday 19th April 2015
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thinkofaname said:
Good for them. But plenty of other businesses genuinely couldn't afford it and would go bust. I know that anti-business types have little problem with evil capitalists going out of business, but they forget that all public services and welfare spending is ultimately funded by profitable enterprise.
Its hardly a profitable enterprise if it relies on the taxpayer to subsidise its wages

hidetheelephants

23,766 posts

192 months

Sunday 19th April 2015
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V8covin said:
Dave Nellist
Any relation to Dave Spart?
alock said:
If they won, they would be the bosses for the entire public sector and hence become the enemy.

I've never understood why any political party with close links to unions should actually want power. The very justification for why a union is needed is destroyed if they become the employer.
They want to get a go at lording it over everyone else, it's a natural human trait; this is borne out by the number of Employment Tribunals there are for ex-Union employees with grievances about bullying, discrimination, pay, sexual harassment, and everything else under the sun.
wc98 said:
at the moment a lot of companies are getting their profits subsidised by the tax payer topping up the wages of their low paid employees. it works both ways.
Yet another marvellous bit of state subsidy for business that the workers' paradise party introduced, without much in the way of objection from any other party. Not only do we all pay for it, it's complicated and therefore expensive to administer.