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4 Big Ideas to Look Smart: The $15 Minimum Wage

If you watch Fox News or MSNBC, I already know how you feel about the prospect of the $15 an hour minimum wage:

-Fox News Viewers - It's Jobs or CPI armagedon!  Small businesses are going to fail!  The business world will have to pass along costs to consumers! Min wage

-MSNBC libs - This is a living wage, people. Let's take a stand against income inequality.

The truth, as always, lies somewhere in the middle.  Here's 4 big ideas to keep either of the extremes at bay (arch conservatives or liberals) when this topic comes up.

--A one size fits all minimum wage nationally doesn't make sense.  $15 an hour means different things even within California.  In LA and SF, that minimum wage might make sense, but it's well above the median wage in inland California counties.  Likewise, what makes sense on the coast doesn't make sense in states like in the South.  Finally, those who tout the $15 minimum wage don't care much about Alaska, but you'd need more than that to make a dent in Anchorage, where $15 per hour is just 67% of the median wage.

--There's no doubt the minimum wage is need of an adjustment.  A wildly diverse group of economists signed off on a $10.10 minimum wage in 2014 as being good for the economy without having a large impact on jobs.  There's no such consensus on $15 per hour.

--Has no one thought about compression?  What about the inside sales rep currently earning the equivalent of 35K per year if you make the minimum wage 30K annualized?  No soup for for anyone else?  The recent moves at Gravity Payments in Seattle make for a nice case study in the unintended consequences of raising the wage floor beyond what the market truly bears.  

--Here's a nice compromise.  Raise the national minimum wage to $10.10, and let cities and states figure out the rest.  The smart play is for individual cities, not states to make the move past $10.10.  See notes above on Cali for the cliff notes.

Have a take on the topic of the $15 minimum wage.  You're an HR Pro, dammit.



I've always been a little puzzled by the minimum wage concept. I get the idea that there are less-than-altruistic business owners, who will try to screw their employees. But I've never worked for a company where anyone but the most entry-level employees received the minimum wage. Even those places gave minimally acceptable performers increases when they learned new skills or demonstrated value. If you're not being paid what you're worth, leave. If the market says you're not worth more, learn to do something the market values more. The Gravity Payments example frightens me.

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