Aibu to not want a £15 minimum wage?

[Israisingwagesworthit]

This morning I saw a post saying there are calls for a £15 per hour minimum wage.

I understand fully that the current minimum wage doesn't give people enough to survive on and something needs to change to ensure everyone gets a comfortable living wage, and I support this.

However by pushing up the minimum wage doesn't that just add additional costs for businesses, therefore increase costs to consumers removing any benefit of an increased minimum wage in addition to reducing the disposable income and pay gap of anyone above minimum wage.

Surely this only benefits the government with additional income tax?

Is this the best option in a time of potential 18% inflation, would this not increase it further?

Capitalism is the issue, rather than sharing the profit wealth, CEO's (of all levels of business, small and large) keep the profits for themselves and just raise prices when costs go up.

Am i being unreasonable to assume that in order for the £15ph wage to be successful, companies must accept lower profits rather than increasing prices in line with the wage increase otherwise its just pointless and daminging to all wage earners not just the minimum wage.

Won't the government have to threaten windfall taxes to those who increase prices to maintain profits to make it work and to actually benefit minimum wage earners?

I'll admit I'm a middle earner (£40k) civil servant (so no chance of a payrise anytime soon) so would be financially damaged by a raise in minimum wage if nothing is done to stop the subsequently price increases of products after a minimum pay rise. As a result my view may be biased, but am I wrong?

So enlighten us... what new business models are going to replace the huge number of employers whose business would no longer be viable? What jobs are all those people going to do when they are made redundant?

Also, I presume that you realise that, while people will have more money to spend in real terms, companies will push up their prices in order to recoup the increased costs, so people's actual buying power won't necessarily increase by very much at all?

Meanwhile, the people who lose their jobs while their employers go under will have less to spend than ever.

But why should Amazon be allowed to exist in the form that it does?

In theory i have no issues with huge corporations. I do have massive issues with:
a) a government that allows tax avoidance and offshoring on an industrial scale
b) a govenrment that doesn't get maximum utility from the taxes it does manage to collect
c) a government that invests so much of it's resources chasing benefit claimants vs what it allocates to tax avoidance
d) a government that rejects out of hand, instead of giving it a proper evaluation, UBI
e) a government, and society, that only considers success in terms of how much money an individual makes. That undervalues the public good that the NHS, the education sector, the care sector, carers etc do over and above the actual cost of what they provide
f) a government that sits by and lets privatised utilities and industries that should be in private hands (there is a good case to be made for including telecoms/post services in that list) rather than renationalising them and paying attention to efficiency
g) related to f, a government that does not understand what a natural monopoly is and how it needs to be regulated
h) a government that perpetuates the class war and allows the gap between the haves and have-nots to contiunally widen
i) a government that does not recognise the benefits of good industrial relations, and yes, that includes things like unions, workers councils and representation of minorities (and women - because let's face it, we are not a minority we are just marginalised for historical reasons) at board level

much much more though

I literally don't care which government it is - but these are basics for me.
(yeah - vote for me - i PROMISE i will be a benevolent dictator)

@Believeitornot is absolutely right. What the OP is pointing toward but maybe not quite reaching is saying that the entire system is broken and no, raising minimum wage does not automatically fix it for the myriad reasons pointed out by other posters. It’s akin to the way many employers worry about employees stealing and have double-validation systems, constant CCTV of their own employees, etc, in factories and professional workplaces, when the truth is that the biggest type of theft is wage theft committed BY employers TOWARD their employees, to the tune of £35 billion in the UK in 2019 alone. And that figure doesn’t even include the companies registered abroad who may be the most egregious offenders, and in addition, pay no taxes. Then you’ve also got between 300,000 and 580,000 not even being paid the National minimum wage by these companies: tribunemag.co.uk/2021/11/wage-theft-karl-marx-capitalism-workers-bosses-labour

We wouldn’t be having this discussion if the system wasn’t broken because the real issue is that people can’t live on what they’re being paid, and a minimum wage increase is a shoddy sticking plaster for that. Instead, maybe if all the tax loopholes were closed, and all the wage theft stopped, and everyone was given everything they earned, and windfall taxes were charged to companies that tried to raise prices for basic commodities like electricity beyond what people could afford while also claiming huge profits and fat CEO bonuses, people either wouldn’t need £15ph to be the minimum wage, or every wage could be set on a fair scale and people would still be able to eat and heat their homes, not just trying to fix a single set of wages at the bottom and not pretend like everything’s not broken top to bottom.

And no, the benefits system is not supposed to be there so that our taxes can cover corporate wage theft, not enacting windfall taxes on corporations when we should, not closing corporation tax loopholes to the tune of trillions, or to make up for higher prices caused by all those things as well as CEOs that all agree to pay each other more, etc (and yes, CEOs sit on each others’ boards of directors and approve each others’ large payrises). But sadly, yes, that’s what benefits have to be used for now, and that’s not the fault of benefit claimants. But it is the fault of the government at large. And they think a minimum wage increase will just shut everyone up. It comes down to this:

They wouldn’t offer this minimum wage increase unless it was cheaper for the Tories and their corporate masters than all the things they SHOULD be offering instead: windfall taxes on corporations, capping the amount energy companies can charge since that’s what worries people most at the moment, other limits on corporate profits, new tax regulations on foreign corporations, etc.

What is the solution? Nurses aren't paid minimum wage so raising the minimum wage isn't going to help. If anything it will increase the chance they will quit their jobs. If small businesses fold it's not going to decrease the amount taxpayers pay as those people will probably be unemployed.

And as wages rise, benefits such as UC and tax credits will fall (as they're income based), so people won't have as much increase in wages as they expect. So lots of damage done in terms of businesses closing down and public sector/charities making redundancies, but not as much increased spending power so more unemployment and those lower earners in work losing some of their benefits!

You have a guarenteed pension and other jobs perks such as holidays, in addition to a £15 phour minimum.

Most on minimum wage are on 0 hours and rarely get any perks

You are being rather 'I'm alright jack' in your attitude

People on zero hours contracts should still receive holiday pay. it's normally added onto the hourly rate.

I wonder how many more minimum wage jobs would disappear from Britain if the NMW were raised to that level.

Call centre roles are already heavily outsourced, mostly to India. With the massive increase in tech to allow WFH over the course of the pandemic, what is stopping any large corporation from taking all NMW jobs which can largely be done remotely and moving them abroad? Or replacing even more staff with machines, as is already happening to cut staffing costs?

Our school is part of a MAT. The first jobs to go will not be TAs - it will be HR, exam and admin staff, with one central person or small team overseeing the work that is normally done in individual schools. It's already happening, in part, as our HR person is only on site twice a week, as is the IT team, and any pressing issues need to be addressed with HQ in London (we are nowhere near London). So processes are less efficient, more mistakes are being made as no one knows anyone anymore, but in terms of staffing out MAT has saves a few £100k.

This would also be a heavy blow to manufacturing and almost guarantee that we, as a country, become even more reliant on imports.

the argument that business will go bankrupt and price will just go up and negate any ruse was the same argument that people used when the minimum wage was brought it. in actual fact neither of those things happened or at least happened in any significant way. Similar arguments have been made all thorough history whenever anyone proposed a improvement in workers rights or benefits. equal pay for women? madness! business won’t be able to afford it, and women will just lose their jobs! did it happen? no.

It did in the 70s I know coz I was there. The benefits buffer was much less then so it's an interesting experiment this time round

@Brefugee I see you've kicked off the crikey almighty/brefugee manifesto

If I can add to it

No person undertaking state medical/dentistry training allowed to go into the private sector for 10 years

Bring back DIYSO - shared ownership housing on the open market (not just new builds) via housing associations

Childcare subsidised at scandinavian levels for 9 months plus.

No company allowed to buy out another company by simply loading the new company with massive debt.

No CEOs of any public authority/service/charity allowed to be on over £250k a year

No private school to retain charitable status unless at least 10% of places are free.

there was increasing unemployment in the 70s but that is generally attributed to opec and oil price pressures. the equal pay act came in in dec 1975 and the actual rise of unemployment was less the year after. for example the unemployment increase from 74-75 was +1.1% the increase from 75-76 was less at 0.9%.

to be clear those figures are increase in the previous year not actual unemployment rates.

No person undertaking state medical/dentistry training allowed to go into the private sector for 10 years

God this. So much this.
I would also go for free school meals for all and that if uniform must be preserved, it is generic and widely available. If school badges are needed - to be provided by the school at cost as sew-on patches

All fees for uni to be abolished - bursaries (useful ones) for professions that have to do a lot of practical experience (nurses spring to mind)
Apprenticeships along German lines to be introduced - not just calling something an "apprenticeship" so you can pay 2.50 an hour

Not sure about the charitable status of private schools. However, am very keen on free places (didn't direct grants used to be a thing? I went to private school* and I'm sure some of the girls had direct grants which were abolished when we were in the 2nd form or something.)

*army brat. i hated it and was homesick for the entirety

No person undertaking state medical/dentistry training allowed to go into the private sector for 10 years

I would amend that to say that people can go into private practice at any time, if they so wish, but as soon as they do, they should be required to start paying off the full costs of their training. The total cost of that training should be calculated over, say, 40 years, and pro rata deductions could be made for any years in which they have worked full time for the NHS. The rest should be paid off in full, with an appropriate rate of interest applied. So medical professionals who stay in the NHS throughout their careers would not have to pay for more than the standard cost of a 3-year degree programme, whereas those who move to private practice at any point in their career would pay back what they owe, with interest, for whatever proportion of their career was worked in the private sector. Same if medics/dentists choose to leave the country to practice abroad, though I'm not totally sure how practical it would be to administer this.

But the welfare cushion was much less, I promise it was tough. Families living locally to each other were able to share the burden. The council I worked for treasurer department were flat out working on rent and rate rebates. The people we had to turn away. No family credits then. Unemployed queuing up for help from the job centre. If you owned a property as the mortgage rates rose you could be in a mess quickly. Pre selling off council stock we still couldn't house everyone who needed a roof over their head

i remember the 70s and 80s very well i promise you. my point is requiring businesses to pay women more did not effect the economy adversely in any significant way. generally speaking improving workers rights and benefits is a good thing in the long run.

Did you not notice all the industry closing down and the start of the offshoring craze to transfer call centre and back office jobs to India etc?

I wonder how many more minimum wage jobs would disappear from Britain if the NMW were raised to that level
This is exactly what would happen. I manage a gift shop and we sell a lot of products that are manufactured in the UK. They’re more expensive because of being made in the UK. But customers value that… to a certain extent.

I can sell a tea towel for £12 and people will buy it because it’s a good quality British product. But I wouldn’t be able to sell the same tea towel for £40. The “Made in UK” stamp is worth more, but not THAT much more. If the NMW increase pushed product prices above what the market will pay, I’d be forced to switch to selling tea towels made more cheaply elsewhere. Then the British textile factory workers would be out of a job.

Stupid idea. They generally do private work as well as an NHS work. Any that don't want to do NHS work will just leave en mass.

‘I understand fully that the current minimum wage doesn't give people enough to survive on ‘

were the 5th richest nation in the world. It’s disgraceful that people working in the U.K. can’t survive on the money they’re paid.

To be honest as well, when did 25 miles become an unreasonable commute? I know a lot of people who commute further than that.

But why should they be allowed to do private work without paying back the cost of the training? And would they really leave the NHS en masse if there was a huge financial penalty for doing so? Surely they're more likely to leave right now, when there is no disincentive for doing so?

That doesn’t make it right.