The Effects of Minimum Wage Hikes
July 1, 2008
Yesterday night I was grocery shopping at the local Meijer. When I went to check out, it dawned on me that they had replaced about a dozen more cashiers with self-scan registers. I will spare you another tirade about the so-far-imperfect technology: it’s nice to be able to check out without waiting in line for the two cashiers on duty at 10pm, but it’s a pain in the ass when the register gives you an error after every item. Even when there is nobody else in line, and I only have one or two items, I’m still not convinced that these machines are saving me time.
But I’m fairly convinced that these machines are saving Meijer stockholders a boat-load of wage expenses. Installing a dozen more U-Scan registers was probably a substantial initial capital outlay, but it’s also eliminating a number of low-wage employment opportunities. Because the minimum wage is in the midst of a 40% hike, which came as no surprise to anyone, a number of people who were making $10 an hour (plus incidental benefits, taxes, etc.) scanning groceries are now unemployed (or about to be unemployed) and watching a machine scan groceries that they can no longer afford to buy without welfare assistance. When the wages due to labor are held artificially high, a few lucky employees are able to reap the benefits, but the rest of them are out of luck as labor-substitutes like capital equipment are made artificially more attractive from a profit-and-loss POV.
Related posts:
- Illegal Immigrants to Sue for Minimum Wage Grievances
- Minimum Wage Legislation: The Gift That Keeps on Giving!
- Rent Seeking and Minimum Wage
- Real Democrats™ & Minimum Wage
- Who to Blame for the Big Three’s Epic Fail
Related posts brought to you by Yet Another Related Posts Plugin.
Comments
Leave a Comment
If you would like to make a comment, please fill out the form below.
Most Viewed
- It’s Not Voluntary, and It’s Not a Contract - 5,187 views
- All Your Property Are Belong to Uncle Sam - 889 views
- Paulson and Bernanke are Lying - 866 views
- Property Taxes are NOT “Rent” - 802 views
- The Cause of the Health Care “Crisis” - 693 views