Even though I have young adult children who only earn minimum wage, I was not too fast to fight for the $15 wage increase. I've made everything from minimum wage to six figures in my lifetime. And, I think the fast-food workers are missing an extremely important piece of the fast-food economics puzzle. A lot of commentators have been talking about how increased wages would lead to higher costs. Most people don't want to pay $15 for a cheeseburger meal. But I haven't noticed anyone talking about the tax implications of higher wages.
Earning more means earning less
I learned early on in my career that a higher salary did not translate into a higher take-home pay. If fast-food workers were to make $15 an hour, they would most likely see most of their extra money eaten up in taxes. People who make minimum wage are part of the 43 percent of Americans who don't pay federal income taxes. According to a recent piece by CNN, 67 percent of the people with zero tax liability earn less than $30,000 a year. In addition to federal taxes, higher earners pay state and local taxes. I personally think fast-food workers should be pushing for a minimum wage of $10 an hour.
Being able to hire fewer people
With all of the technology at their disposal, most companies can replace human workers with robots and other technological tools. If fast-food workers are going to demand $15 an hour, it's likely someone will invent a robot that is less expensive and does twice the work of an actual human being. During the recession, I noticed a lot of retailers hired half as many people. It seemed like it would take forever to find anyone who actually worked at the stores.
Looking at Canada's minimum wage
In Canada, the minimum wage ranges according to each province. Workers make a general wage of anywhere from $9.95 to $11 an hour. Some Canadians complain their minimum wage is too low. When I visited Canada this past year, I noticed the food prices were extremely high. Real estate is also astronomically high in Canada compared to prices in the states. As a consumer, I'm afraid I'll have to deal with higher food prices, more expensive home prices and overall inflation if workers get paid $15 an hour. As a parent of sons who make minimum wage, I'm more concerned about their higher tax burden.
I do feel empathy for people who have to make it on minimum wage. I worked as a waitress while in college. However, it was the low pay and grueling work that motivated me to keep pushing for higher goals. Just because college-educated people have no other job prospects other than working at a fast-food industry doesn't mean they deserve double the wages. Senior citizens need to bow out of the workplace. Then, teenagers and young adults can take back the entry-level jobs. Young adults and middle-aged workers can slip into managerial and executive positions. The answer isn't to double wages for entry-level jobs, but to increase their wages by a few dollars. Then, motivate senior citizens to retire already.
More from this contributor:Six Figures but Living Paycheck-to-Paycheck
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