
Amazon’s Minimum Wage Will Change How Americans Think About Work - petethomas
https://www.bloomberg.com/view/articles/2018-10-02/amazon-s-15-minimum-wage-will-change-how-americans-see-work
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hashberry
An interesting tidbit on minimum wage:

> According to the Pew Research Center, when adjusted for inflation, the
> federal minimum wage in America peaked at $8.54 in 1968. If the federal
> minimum wage had kept up with increases in worker productivity since then,
> in 2012 it would have been $21.72 an hour.
> [https://www.forbes.com/sites/timworstall/2015/09/07/there-
> is...](https://www.forbes.com/sites/timworstall/2015/09/07/there-is-
> absolutely-no-reason-why-the-minimum-wage-should-track-average-labor-
> productivity/#37da2fc14afa)

~~~
JohnCohorn
I know nothing of economics, but I’m curious how relevant comparing against
our own historical productivity actually is. For example, shouldn’t the
comparison also be against productivity and productivity/wage growth in other
countries we’re competing with? Is productivity even something that can be
measured in such a way that useful comparisons can actually be made across
time periods?

~~~
derefr
> Is productivity even something that can be measured in such a way that
> useful comparisons can actually be made across time periods?

[Inflation-adjusted] GDP is held to represent the productivity of an entire
country in a way where one can make historical contrasts.

Therefore, [inflation-adjusted] GDP per capita (a.k.a. PPP, Purchasing Power
Parity) _could_ be a valid measure of average individual worker productivity.

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jngreenlee
$15/hour in some cases is enough to move above the maximum for Medicaid (133%
of FPL for various family/household sizes).

Many low-income workers DO NOT want to lose Medicaid as it is a big benefit,
works well, esp. for large families (consider a grandma that has adopted three
of her grandchildren and needs to care for them, I talked to one last week).

I own a small business with a few part time employees, and I run into people
asking for less pay but more in other benefits (PTO, holidays, etc.)

Will be interesting to see the impact of this.

~~~
itsdrewmiller
Do any of them ask for less pay with no compensating benefits? If not it seems
like this is still a good result, if not perfectly optimized to take advantage
of benefits for those with low income.

~~~
Consultant32452
Just to add another anecdata.. A close friend of mine owned several Subway
franchises. This was always a double edged sword for trying to figure out how
to reward the best employees. Virtually every single time a person was given a
significant raise, they asked for fewer hours. They were comfortable living on
$X/wk and now they could make that working fewer hours. This is perhaps good
for the worker but obviously bad for the store. The best employees are working
less and less, decreasing the quality of work done in the store. This may or
may not have had anything to do with qualifying for benefits of some sort. But
it is a very difficult problem a lot of small business owners face.

~~~
b_tterc_p
That’s an interesting problem because social support systems are thus actually
pushing people into continued poverty rather than helping them get out.

~~~
Consultant32452
I think it's more difficult than that. They are happy with their current
living situation. In over a decade of owning Subway stores not a single person
took their newfound wealth/leisure to improve their lot in life. When they
left it was always to other Subway-esque jobs. Nobody took night classes or
anything of the sort. Sure, some people took a job at Subway while they were
in college or whatever, but what I mean is that getting that big raise was not
a deciding factor in taking the steps to improve their financial situation.

From there I get a lot of mixed feelings about projection. Who am I to tell
someone that they should increase their income if they're happy with their
lives? Or perhaps they don't understand/see a path from here to greater
economic success? If that's the case, we have a different problem. I really
don't know, it's very confusing. It's hard to consider public policy in a way
that doesn't project my own sense of values on others.

~~~
brokenmachine
_> getting that big raise was not a deciding factor in taking the steps to
improve their financial situation_

How big a raise are we talking here? It's a fast food job. I doubt we're
talking CEO-level bonuses.

The raise is not going to be enough for them to move from being workers to
being owners.

~~~
Consultant32452
>How big a raise are we talking here?

We're talking on the order of several dollars an hour, which is a lot when
you're making minimum wage.

>The raise is not going to be enough for them to move from being workers to
being owners.

I feel like this is intentionally obtuse. It may not directly make them an
owner, but if they leveraged that raise it could put them on the path there.
They could take management classes at a community college or something. Even
without the classes they could double down on the behavior that was returning
a good benefit and learn those management skills "on the job." Instead they
reduced their hours to maintain the same weekly take home pay. Of course
there's a nearly infinite number of options unrelated to Subway they could
have spent their new money/time/leverage going towards. But not one time did
it happen in ten years and across several stores.

~~~
brokenmachine
_> I feel like this is intentionally obtuse._

There was a bit of exaggeration for effect there, but my point is that a few
dollars above minimum wage may be a big percentage rise in your opinion, but
is still not a good wage. They go from "hardly able to afford food" to "maybe
able to not live paycheck to paycheck - until something unforeseen happens".

 _edit: offtopic because you said they wanted less hours but I 'm leaving it
there:_

Maybe they wanted to enjoy spending some of their newfound discretionary
income on something other than rent and bills. Or maybe they wanted to go from
a shitbox car that needs repairs to a slightly better shitbox car. Or a
million other things they've been waiting until they have the cash for.

I feel like you may be a bit out of touch on how close to the edge someone
living on slightly over minimum wage actually is. There's a thousand things
they might need to spend that extra cash on. It costs more to be poor.

 _back on-topic_

I know you said they wanted to reduce their hours but from my own experiences
when I was doing shitty jobs I honestly felt that I wasn't being paid enough
for my time so as long as I can earn enough to eat and pay the rent, I'd
rather just have the time to do what I want, because (at least to me), that
free time is really what makes life worth living at all.

So, at least in my case, an incremental raise to a sandwich workers wage
wouldn't be enough for me to still want to exchange my time for that money.

Now I'm being paid well so I have enough incentive to keep me from wanting to
reduce my hours because I can see progress being made, but only just... Maybe
I overvalue my time but at the end of the day, time is all we have, and it's
limited.

A few extra dollars per hour isn't going to change someone from a sandwich
maker just above the poverty line into some trust fund baby that has the time
and spending money to do extra courses and start being an entrepreneur.

I know what you're saying about them having (slightly) more of an avenue to
success with a raise but there's always more that any of us can do to improve
our lot in life, if we have the energy. Arguably poor people have more demands
on their time, so I feel that looking at the poorest workers and saying, "why
don't they do better" is a bit unfair.

Also, how do you know what they did with their extra time?

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yitosda
Calling it "minimum wage" seems like a marketing gimmick. I believe Amazon
finds themselves needing to raise wages because the other large employers are
as well.

In other words, the unemployment level has finally dropped far enough that
employees start to feel the benefits of competition. This is good news for
lots of people, but not really a paradigm shift.. ?

~~~
tvmalsv
And, from what I've read, Amazon is supporting legislation of a higher minimum
wage. Which, seems to me, would be more of a burden on their competitors than
themselves, thus giving Amazon a competitive advantage.

~~~
AjithAntony
Just like when they lost the sales tax battle. They flipped their position to
lobby for sales tax for everyone.

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hashberry
I had many summer warehouse jobs doing picking and shipping/receiving. I
busted my ass off with lots of manual labor and strict timetracking. But my
co-workers were not exactly the brightest of the bunch: alcoholics, ex-cons,
high school drop outs, poor English, etc. There's an entire bottom rung of
society that most people ignore. Higher wages are for attracting and retaining
better workers. If $15/hour ever becomes minimum federal wage, I bet Amazon
would up their own minimum wage as well.

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nerdponx
Why do minimum wage discussions almost never take cost-of-living into account?
Minimum _livable_ wages vary widely.

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HelloFellowDevs
I don't think the shift to $15/hr will make as much of an impact as this
article theorizes. It's not barely enough to live off but the buying power
still isn't substantial. So giving workers more 'freedom' because of the hike
to $15 won't make much of a debt imo.

~~~
ericd
If you go from $12/hr to $15/hr, that might not seem like a large difference,
but it might mean going from a net income of -$50/week to +$50/week, which is
a massive difference - one means a debt spiral, the other means building
savings. Or $20 to $120, 6x the disposable income.

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da02
What's it like to work for Amazon?

~~~
brianwawok
IT or warehouse? Two very different experiences.

Warehouse has always paid well for the educational requirements. Many people
don’t love walking a few miles a shift, nor not having time to use the
restrooms. Others obviously thrive in it, they have a lot of workers and can’t
all be turned over every month.

~~~
da02
Thanks for the info. Have you worked at an Amazon warehouse?

~~~
brianwawok
No just read a lot. There’s a lot of first hand reports.

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prolikewh0a
$15/hr is not a lot of money, regardless of how positive and mind blown these
media websites are. Nobody's "moving cities" for $15/hr. It's still barely
above poverty in anywhere that's not rural. $15/hr in Seattle is poverty or
living 2-3 hours away from work.

~~~
ProfessorLayton
I'm not going to argue that 15/hr is a lot of money, but as someone who didn't
grow up with much, it isn't terrible either.

That translates to ~30k/year, which doesn't sound like much, but for a dual-
income family a $15/hr min wage (Something Amazon is lobbying for) becomes
60k/year — Pretty much the median household income in the US [1]

Just putting some perspective.

[1]
[https://en.wikipedia.org/wiki/Household_income_in_the_United...](https://en.wikipedia.org/wiki/Household_income_in_the_United_States)

~~~
throwaway2048
keep in mind 15/h is radically different from when you grew up, especially in
a city that anyone wants to live in. Over half your wage is going towards
rent, even with the shittiest conditions.

~~~
tcbawo
Many people are choosing where to live based on income/expense differential
instead of just income. Talent is choosing not to relocate to high cost of
living areas, so many companies are opening up offices in these middle-tier
cities.

