Thursday, January 6, 2011

Biting the hand that pays us inadequately

Youth jobless rate soars to 19.4%

What I said—at comment #72 on the article, is—

@Will #21: "Set the minimum hourly youth wage slightly above what a weekly unemployment benefit works out as when divided by 40."

For the record, the weekly unemployment benefit is $180.74 gross for a single adult not living at home (it's less for adults aged 18 and 19 who still live with a parent). People under the age of 18 are, of course, not entitled to the unemployment benefit.

$180.74 divided by 40 works out to be $4.52 per hour. That is 35.47% of the current minimum wage. Living expenses are of course variable, but there is a limit to how cheap things get; for example, the cheapest room I can find as of today in Wellington is $75/week plus expenses of $20 to $25/week. A very frugal person could perhaps manage to keep their food costs below $25 or $30 a week.

What people continually forget in this debate is that many, if not most, of the people who earn minimum wage or close to it a) do not work full-time even if they would like the hours, b) do not have secure or stable hours, and c) are in fact invested in their source of income. It is this last that bears repeating: people rely on their source of income to sustain them.

If the income people earn through paid work is not enough to live on, the state will step in to make sure that the person survives. I think it would be a fair assumption that most of the people on the dole in our major cities also receive accommodation supplements or subsidised accommodation or a combination. If people are earning, through full-time work, only slightly more than what they would receive on the dole, then they will probably need additional income from the state.

... which effectively means that we the taxpayers would be subsidising employers who are too cheap to pay their staff a decent wage. Awesome! My tax dollars at work!


There's a lot more that could be said here. I'd expect most people replying to my comment (if anyone did) to talk about the market a lot, and how people wouldn't take jobs that don't pay them enough money, and to that I would say:

  1. Obviously there are far more people than there are jobs, hence the unemployment rate being so high (there are people who aren't working and who avoid being in paid work for whatever reason, but... not that many).
  2. The unemployment benefit provides an absolute pittance, but it may be useful in figuring out a bottom line of "the least amount of money a person can survive on".
  3. The minimum wage acts as an absolute bottom figure of what employers can pay their staff.
  4. It influences the wages above it, too - so if the minimum wage for young people falls (which I believe can only affect new hires), we can reasonably expect wages in industries where a lot of young people get hired onto the minimum wage to generally fall over time, or to not keep up with inflation.
  5. In this way, the minimum wage itself partly determines what the market rate is.
  6. You just have to remember that people have to have an income or they will die. Therefore in the absence of any state control as to the lowest amount that income is, they will take what they can get, because they have to have an income or else they will die.

Yeah, yeah, yeah, but that's what the unemployment benefit is for!

  1. ... yes. But I thought we all agree that generally it's better for people to be working in paid employment than being on the unemployment benefit?
  2. #6 is really more about the inherent disparity of power between employers and potential employees. People need jobs (largely) more than jobs need them.
  3. And if the market for a retail staff member in Wellington city is $13.50/hr, and you need a job, and the only jobs which you are capable of getting is in retail, then... good luck trying to persuade the boss that you're really worth $15. Like, maybe you'll get a payrise once you've been working for a while... but payrises are usually made in proportion to whatever the starting wage was (see #4!).

But people can upskill so that they can get better jobs in the future!

  1. That's not going to do much about their income situation now, is it?

But all my youth staff members EVER have been totally crap.

  1. Well, that's clearly not true of all youth employees ever over the entire country. Perhaps you need a better hiring process? Perhaps you're a totally crap employer (it could happen to anyone, really).
  2. There's also a lower minimum wage for people who have just entered into the job market, which should have allowed a bit of breathing space while you trained them up.

I was an apprentice in 1975 and I earned youth rates and it was fine. Kids these days. Don't know how lucky they are. Flat in a 3-bedroom house with insulation? LUXURY.

  1. Awesome, I'm glad you had a cool apprenticeship! A quick google search doesn't disclose to me any helpful statistics from 1975. Wouldn't you like to know how average youth rates stacked up against a) the unemployment benefit at the time, b) the adult minimum wage, c) the median wage, d) the average wage and e) some data about the cost of living? I KNOW I WOULD.

But we should incentivise employers taking on youth workers!
  1. Yes.
  2. I don't think we should create a situation where the behaviour that is incentivised is taking on young workers just because they're cheaper.
  3. I realise that taking on people who don't have a good employment history (or any employment history) is a risk.
  4. But taking on any employee is a risk. As the old adage goes, people rise to their natural level of incompetence. This leads to some awful dullards in senior and middle management (as I have myself experienced in all my previous jobs). It also makes for bad typists, engineers, machinists, teachers, neurosurgeons, baristas, barristers, and plumbers. Incompetence isn't limited to people in unskilled work! People in well-paying jobs aren't, on average, more intelligent or capable than people in jobs that don't pay well.
  5. The fact of that risk isn't a good enough reason to allow you to not pay people fairly. You want to work in a risk-free profession? Get a different job!


I kind of try, in my posts about politics, to keep calm and carry on. But underneath the bullet points and the attempts at well-formed arguments is a deep well of rage, and it goes something like this:

When you tell me that some people are only worth $2 an hour*, in a city where the cheapest flat I could find (on a cursory skim) costs $75 a week, plus expenses, plus food, plus transport and clothing and so on... when you tell me that, what you are telling me is that some people aren't worth being able to live in a house and eat until they are no longer hungry and have running hot water.

And when you tell me that, I don't have to listen to anything else you say: you're a worm, and yours is the sort of thinking that causes revolutions.

* As some disgusting fuckbag said in a comment thread one day...

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