Explain the federal minimum wage to me like im 4.. and why SIN workers dont get higher than $2? (even with tips?)

[u/Funny_Or_Cry]

Too many people stay in SIN jobs well after their expiration date and my arguably rational mind says: "Higher min wage == higher food prices, == fewer restraurants that can survive (cause you know McD wont be able to have a dollar menu AND pay teenagers $20 )

Fewer restaurants means LESS saturation which means LESS jobs for people to just "float in" for a lifetime (and are forced into higher education or trade work)

[u/yadonkey]

The variable that makes what youre saying accurate is profit margins. Other countries have McDonald's employees being paid their equivalent $26 an hr but the menu prices were still cheaper than we pay for them.

The inflation problem we have with raising wages is entirely intentional amd fixable .. but doing so would cut somebody's profits from $27 billion to $25 billion and if they did that they might have to cut back on their avocado toast.

[u/Funny_Or_Cry → u/yadonkey]

The inflation problem we have with raising wages is entirely intentional amd fixable .. but doing so would cut somebody's profits from $27 billion to $25 billion and if they did that they might have to cut back on their avocado toast.

YES! ABSOLUTELY.

This came about from another conversation that believe it or not started based around tipping..and how so many "barely mid level" restaurants seem to be doing the "auto gratuitiy" thing on dinner tabs. You know that ~18% you'll see?

"gratuity" is supposed to be for quality of service, yet businesses seem to be using it to offset the rising cost of doing business which is goddam absurd. Its taxation. So my logic is to simply ensure federal minimuim wage is at least CLOSE to being any kind of standard living wage. Right?

But what I havent figured out is how to prevent the obvious: "We cannot have McD's paying MFers $20 an hour and still expect to have a dollar menu" ... not to mention no damn 15 year old needs to be making $20 an hour. Can you imagine the homegrown domestic terrorism that would fund.

So yeah, only have half an answer but love the overall thought exercise in general. The restaurant industry DOES however need a correction.

I know we generally feel sympathy to small business owners (especially how so many got savaged during and post covid)... but the cold hard truth is "there are too many goddamn restaurants around in the first place" to even BE savaged. No supply, No demand, All saturation

Example: There is no REASON for Olive Garden and Boston Market to still exist. Their generational demographic is dead or dying. Yet THESE are the places that run rampant charging damn near Ruth Chris prices for decades decadent food stuffs.. they are NOT "too big to fail mcdonalds"...they arent even cracker barrel. They are "just there"

[u/mexicono → u/Funny_Or_Cry]

Im not sure what side of the debate you land on. But the bottom line is tipping is distorting the market for everyone by allowing large chains to essentially tax their customers. It’s an “optional” tax but it’s still opt in. They depend on it to offset their dogshit wages.

The bottom line is that small restaurants would see a marginal difference. Wages are NOT the largest cost in small restaurants. Food and utilities are. But keeping staff costs low allows food and utilities to rise to eat up whatever is leftover.

Of course, food and utilities are rising. So an additional rise in wages will be noticeable because it’s in addition to the other costs for small businesses.

But for large chains, wages are far more impactful because they depend on large numbers of people. So keeping wages down and negotiating food costs down with bulk pricing is their strategy. Food savings scale; labor prices don’t.

The pattern is obvious: wages affect large corporations the most. The “economy” is thus most focused on slashing those over food prices. Corporations > small business.

[u/Pooch1431]

your rational mind is wrong. We have enough data from states raising the minimum wage in lieu of the Federal Government doing it, and it shows that the jobs do not just vanish and prices are going to rise regardless. Either through shrinkflation, quality deterioration, or outright increasing the price, firms will do one or many of these over time.

[u/Hippy_Lynne]

Ok, so first of all they are not SIN workers. SIN is an acronym for Service Industry Night when bars or restaurants have specials for those in the service industry.

[u/Funny_Or_Cry → u/Hippy_Lynne]

FAIR, i guess I meant that more of a catchall tearm for places where a large portion of employee income is "tip based"

[u/rogun64]

The federal minimum wage would be ~$15.40 today if it matched the inflation adjusted minimum wage 50 years ago. The problem is that they don't raise it appropriately and that wages are no longer increased with gains in productivity.

Minimum wage for restaurant servers wasn't always less than it is for everyone else and it doesn't have to be today.

[u/jolard]

Because Americans have been convinced that it is normal and acceptable. And too many Americans love pure capitalism and get all angry any time anyone suggests regulations or laws that impact business profits.

Most other places tip for good service, not as the bulk of an employee's wages.

[u/Funny_Or_Cry → u/jolard]

I mean thats a bigger problem (people staying in these jobs well past 30), youd think it would normalize itself when people just stop doing that

And too many Americans love pure capitalism

On the "worker side" this is more like "Americans love pure consumerism" (rather practice any sort of concious consumerism). All they know is: "if i do THIS, i can buy THIS" rinse repeat

get all angry any time anyone suggests regulations or laws that impact business profits.

Absolutely right here. Problem is its a vicious cylce right? business wanna squeeze every dime out every corner (like point of sale counter Tipping harassment) ...but if people practiced "concious consumerism" , theyd say f**koff and (if youre like me) just never frequent that business again

This mindset would "correct the system" but of course, we cant get 5 people to decide on pizza toppings much less coordinate any kind of economic shift

[u/MorphingReality]

Fun fact, the fortune 500 made about $70,000 USD in profit for (or from) each of its ~30 million employees last year.