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Saturday, October 25, 2014

Raise the wage??? More money or more worries?

A lot of people are jumping up and down and cheering at the thought of raising the wage to ten, and sure, it sounds good, but what are the costs of a  nationwide raise. It probably wont apply to small businesses of course, and it may only apply to full time wage earners anyway, but big business didnt get big by being dumb. Many of you out there know that if a large company has to pay you more, they are going to find the money to do it with the way they always have. Say, a big company called Scrooge and Marley, Inc., was to be forced to give them a 3 dollar raise next month... How would they do it? Well, you see, companies succeed by keeping their overhead low, which means they would have to cut labor costs by hiring less people and laying off some. Also, they would put the workers they have on part time status to cut overhead and improve profit margins. This is inevitable of course, but I write it better from a maybe they wont have to point of view.

Anyway, when all their workers or wage earners as they are also known, are on part time, the company will have more profit, and the share holders like profits a lot. Also, since part time workers are not required to receive certain benefits that full time workers receive, the company will be even more interested in cutting hours and staff size. What will this mean for John and Mary Employee? Well, now that there is less help they will be required to do three times as much work or else. Also, one of the benefits that workers lose is their full time health coverage which part time workers do not get. #passTHEbuck

Of course, with your hours cut you will have more time to spend at home, assuming you still have a home since cost of goods sold and cost of living and gas prices and retail prices will all HAVE to go up to pay for the raise you were jumping up and down about before. Hopefully, paying your mortgage will not be a problem while you are struggling to keep gas in the Caddy.

Then again, they may not cut everyone's hours. Some may still get to work 40 a week, and get the big check, but since inflation has to go up to cover the raise, will they really be making more??? Well, we can always hope and watch and wait.

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