Why should "small businesses" be able to pay people less than a living wage?

[Duer 157099]

Jesus I'm tired of hearing this! "Oh, but what about the small businesses, the mom-n-pop shops, what about them?!!!

Right. Because underpaying people just so that you can be a "small business owner" is fair.

If someone works 40 hours a week, they should be paid a LIVING wage.

[el_bryanto]

1. and if the company goes out of business - or fires 3 to pay for the salary uptick

of the other seven? Not necessarily opposed to raising the minimum wage (i'm in favor of it) but truthfully the most difficulty will come in those small businesses.

Bryant

[Duer 157099]

2. Right. If a business cannot survive it goes out of business

That is the nature of business.

[HiPointDem]

3. unless it's wall street or a major corporation. then you get a bailout and a government-assisted

'bankruptcy' that lets you steal the pension and health funds. and cut wages and benefits. and hire cheap slave labor offshore.

[Duer 157099]

5. Right. That's bullshit too.

We need a great big overhaul. If big biz didn't get all those bailouts, then small biz would have a more level playing field and wouldn't have to underpay workers to survive and compete with walshitmart.

[HiPointDem]

8. but that's not happening. meanwhile, small business is dying and every nook and cranny

(including second-hand, traditional backwater) is being taken over by big business.

[cali]

14. wrong. there are some niches in which small business is thriving.

quite a few, in fact.

[Duer 157099]

19. Yes, true n/t

[HiPointDem]

34. the statistics say otherwise.

[cali]

46. not that you've provided any evidence for that claim.

In my state, small business employs 60% of the workforce.

http://www.wcax.com/story/21218856/majority-of-vt-small-businesses-have-no-employees

[el_bryanto]

4. Do you think it woudl be worthwhile to look at how many small busniesses would close?

or possibly set aside some help for those businesses who might go out of business donig this?

Bryant

[Duer 157099]

6. Absolutely.

Set up a fund that matches what was used to bail out Wall Street and other big biz over the years. Use that to compensate small biz during a "level the field" period.

[Lars39]

33. If we can subsidize farmers, we can subsidize the truly small business.

But pay people a living wage.

[PotatoChip]

55. Yes.

Government subsidies should always go to business' who truly need them; for the sake of common good. Not entities that can hire the best DC lobbyists.

[OceanEcosystem]

73. No, the small business might survive

But the newly unemployed workers would suffer.


A small business that pays each of its ten employees $30,000 a year pays a grand total of $300k a year in salaries.


The small business, if it trims its employee force to just six employees and then raises each of their salaries to $50,000 apiece, still pays out $300k a year in salaries, unchanged.



But the difference is that four people are now newly unemployed.

[starroute]

84. Where are you getting these numbers?

If the minimum wage was raised to $10 an hour, that would amount to about $20,000 a year for someone working full-time.

For a family of three people, that would be just barely over the poverty level -- and well under the 130% of the poverty level that will qualify you for food stamps or free school lunches for your children.

Even if you believe the government should be subsidizing small businesses to keep them afloat, that seems like an awfully inefficient way to do it.

[Yo_Mama]

89. Such a small business would not be affected

Or only positively, perhaps.

Since none of the current employees are making minimum wage, there would be no need to cut workers.

[robinlynne]

98. and that the business can not produce the same goods.

[Yo_Mama]

88. And also recessions

when businesses that cannot survive go out of business in large numbers, creating very high unemployment.

In general, making any sudden economic change will cause some economic disruption. If you are going to raise the minimum wage, doing it slowly should minimize increased unemployment.

[Capt. Obvious]

16. There must be a list of all the small businesses that went out of business in 2007

I bet there's a website (or several) of a certain bent that has them all cataloged.

[jeff47]

75. We've done tons of natural experiments on this subject

Lots of states raised their minimum wage while neighboring states kept the federal minimum.

Unemployment did not go up in the higher minimum wage states.

Higher minimum wage means more spending money, which means more business.

[Bay Boy]

78. I'm not sure how that would help my business...

...my customers are other small businesses. Joe Six-pack getting a raise isn't going to make use of my services. In fact I see a loss of business as my customers make cut backs.

[jeff47]

80. And when your customers make more money in their businesses

do they just shove it in their mattress?

Doesn't matter if minimum wage earners are not your direct customers. They're your customer's customers. Or your customer's customer's customers. And so on.

[LiberalFighter]

83. If they go out of business it will because the demand for their goods or services isn't there.

If they have to let some workers go it won't be because of the increase wages. It will be because the demand for goods or services isn't there.

Provided everything else is in alignment. If the owner(s) aren't pocketing excessive income or cooking the books.

[LanternWaste]

87. If a company is devolved enough to have the stark choice

If a company is devolved enough to have the stark choice-- pay employees a living wage or go out of business, forced onto them, then the business owner is too much of an idiot to own a business in the first place.

[davidn3600]

7. It highlights why the system may be beyond the point of no return

We have become an economy of big corporations.

The wealth disparity that exists between the rich and poor people also exists between the rich and poor companies.

[HiPointDem]

9. +1

[Duer 157099]

10. No doubt it is a serious spiral

but if left alone, it only contiues to go down.

[Cleita]

11. Many small businesses pay their employees more than the large corporations do.

They value good and loyal employees. I don't know where this meme comes from other than out of the ass of the RW think tanks. However, I was watching "Bar Rescue" last night and it was about a bar owner who didn't pay his employees and expected them to live off of tips. Beside this being totally illegal, as a bar manager myself at one time, I know it's an invitation for the employees to steal. He himself was having a hard time meeting the bills, so I'm sure his employees were taking their wages one way or the other.

He had convinced them that this way they didn't have to pay taxes. Really, as long as this goes on, it becomes a norm. The IRS or someone needs to crack down on these small businesses who aren't paying their employees. My last employer tried to pay me under the table. I insisted on getting a 1099 from him as contract labor at least. Imagine if you cracked down on all this under the table labor, we might not have a fiscal crisis in Washington after all.

[Duer 157099]

13. I support small biz whenever I can

even if it means paying more.

[cali]

12. My answer is in the links

These are all local businesses in my neck of the woods. All innovators. All socially responsible. My community is a better- much better-place because of these businesses.

http://www.cellarsatjasperhill.com/

http://www.highfieldscomposting.org/

http://buffalomountaincoop.org/

http://www.highmowingseeds.com/

http://caledoniaspirits.com/

http://www.hillfarmstead.com/main/

[Light House]

15. Do you have any idea what it takes to own a small business?

I have to follow all Fed., State and Local laws regulating a business, I have to pay all Fed., State and Local fees, taxes, there's alot of stress in owning and running a small business.
I would love to pay my employees $20.00 an hour but then I would be out of business PDQ.

What do you consider a living wage dollar wise?

[Duer 157099]

17. A "living wage" numerical value will vary according to location

A living wage, imho, is one where, if one worked for 40 hours a week at that rate, they could afford a place to live, transportation, food, medical/dental care, utilities, etc.

I would think that is obvious.

[Light House]

22. I misunderstood you.

I thought you meant a set wage no matter what the location is.
Then I agree with you and I do pay my employees a living wage for the location of my business.

[riverbenddem]

54. I disagree - I don't believe that every job needs to pay a living wage....

There are plenty of people just looking for part-time, supplementary jobs (i.e. students, retirees, house husbands / wives, etc.). My daughter, for example, is a student and is just looking for spending cash. I would not expect that her employer pay her enough for "a place to live, transportation, food, medical / dental care, utilities, etc.".

Basically, these are "starter" jobs that are not, and never were, meant to be a final career destination. They should not have to pay some arbitrary amount to fully sustain the people that work at them.

[Duer 157099]

59. That's how the slippery slope begins

first it is just "extra" income and then pretty soon, the employer can only afford to hire people at that rate, and then everybody is making the wage that someone who only needs "extra" income gets.

See how that works? We are now living at the bottom of that slope.

[white_wolf]

74. That may work in a strong economy, but...

when you have an economy where people who have worked at jobs for 10+ years get laid off and then are forced to work these "starter" jobs so support their families they should have to pay a living wage.

[riverbenddem]

77. But why is the responsibility for the bad economy turned onto the small businessperson?

The fact that the economy is bad should not mean that every small business should then have to pay someone who sweeps the shop enough so they can cover rent, food, health care, utilities, etc.

Some jobs just do not merit making a full "living wage".

[OceanEcosystem]

76. But of what level of quality are we talking about?

Many people can afford "a place to live" if we're talking sharing an apartment with several roommates, but not if we're talking about purchasing a two-bedroom house.


Many people can afford "transportation" if we're talking about taking the bus or riding a bicycle, but not if we're talking about purchasing a sedan from a dealer for $10,000.


Many people can afford "food" if we're talking basic, nutritious groceries, but not if one wants to eat much more high-quality fare.



Much of this still isn't/wasn't defined.

[nebenaube]

47. history is not on your side.

I have heard this continually all of my life and it's bullshit. Business had their chance, you've had the deregulation and the tax cuts. All the 'small businessmen' did was line their pockets.

[Light House]

51. Maybe you should read post #29.

[Kingofalldems]

49. Gee I thought you were a policeman

http://www.democraticunderground.com/10022385809#post77

[Light House]

58. I never said I was a cop.

You said I was commenting on posters knowledge of police procedures and I said yes I am, as in, yes I am commenting on posters knowledge of police procedures, not once did I say I am a cop.
Nice misinterpretation.
I happen to be retired and I started a small business.

Now be a good lad and go stalk someone else.

[datasuspect]

66. that kinda stuff is creepy as hell

what productive member of society has the time to do crap like that?

geez.

[Light House]

67. I don't know what I did to attract this persons attention.

I guess s/he fancies them self as some sort of protector of DU.

[datasuspect]

68. it's better to just ignore them

i feel for ya, this place can be a minefield of unhinged stalky types.

[Light House]

69. I'm really hesitant to put anyone on ignore

but if the stalking keeps up, I'll take your advice.
Thanks for the advice.

[Kingofalldems]

92. If you think I am stalking you, which I am not

Why don't you take it to the Admins?

[Light House]

93. I see no reason to take such a minor problem to the Admins.

But you seem to have a problem with me for what ever reason so I propose a solution, we just don't communicate with each other anymore and I'll start now.
Goodbye.

[Kingofalldems]

94. Ah, didn't think you would

[Kingofalldems]

99. Check Light House' profile now

Unhinged stalky types you say?

[ZombieHorde]

18. Interesting thread. nt

[YarnAddict]

20. What about the non-profits?

The animal shelter I volunteer at pays their employees minimum wage--$7.40/hr. and if they have to start paying the 6 or 8 workers nearly $1.50/hr. more, I'm afraid they will end up closing their doors.

[Duer 157099]

23. Yeah, there are some tricky exceptions

Non-profits might fall in that category where something else has to be done. I understand the issue.

[gollygee]

27. The good thing about the minimum wage being raised

is that it would raise for everyone on minimum wage, plus people currently making slightly more than minimum wage will see their wages go up a bit as well. If everyone has more money, more people spend more money, but also people will end up donating more money. When people don't have enough money to get by themselves, people donate less, and non-profits have a harder time.

[EastKYLiberal]

30. Minimum wage workers that work for nonprofit organizations should get a subsidy. nt

[Cobalt Violet]

36. Maybe if low income people were paid more they afford to be pet owners.

That might mean less in the shelters. I'm on my last pet ever since I can no longer afford vet bills. If I were paid a living wage I could do my part by owning 2 cats and donating to shelters. It's out of the question now. Very sad future for me without a cat.

[bemildred]

21. Because "owners" get all the money, everybody knows that. nt

[Light House]

24. That's not true at all.

Large corps., yes, but not small business's.

[Duer 157099]

25. Way to miss the point n/t

[cali]

26. Not true.

I know many small business owners who are passionate about what they are doing, who don't get rich off of their businesses and for whom money is not the primary object.

Please look at my post #12 in this thread

[Light House]

29. I'm one of those

and I care more for my employees than making a huge profit.
I'm retired, I have a pension so it's not like I'm struggling for money, I make sure my employees come first and then whatever is left over at the end of the month, I'll usually reinvest it back into the company.

[Duer 157099]

31. You are one of those doing it right

[Light House]

35. Thanks.

Appreciate it.

[EastKYLiberal]

28. They shouldn't.

If you can't run a business that pays well, then sorry about your luck... maybe you should put in longer hours yourself or go work for someone else.

Just like if you can't afford to tip, you can't afford to eat out.

[Light House]

32. Are you sure you're in the right place?

[Cleita]

38. I agree with you. I seldom eat out any more because I can't afford to tip.

I can't expect servers to have to share in my economic downturn. I also agree that you need a business plan that insures you can pay the help decent wages as well as the business taxes and expenses that go along with it. My DH and I had a mom and pop hamburger eatery for about eight years a long time ago. We worked 24/7 ourselves for the first eighteen months until we got established before we started hiring anybody. So I agree, if your business can't sustain decent paying jobs for your employees, you do the work yourself, go back to the drawing board to figure out a plan, or give up the business as unworkable. We eventually got out of the business when we ran out our lease and the landlord not only tripled the rent but decided he wanted a percentage of our profits too. We decided it wasn't worth it. We went back to work at what we had done before.

[kestrel91316]

39. Funny - that's really not a liberal viewpoint. It's actually very RW/libertarian/dog eat dog-ish.

How very odd. Makes a person wonder........................

I own a small (actually fairly micro) business. I have sacrificed a lot so that I could pay my employees a decent hourly wage compared to many of my colleagues.I know how to make more money (other than wishing for the economy to improve) - it involves lying, cheating, and stealing. Those are, increasingly, the only ways to get rich in America anymore.

[Cleita]

52. You have to blame our system, not the employees or the POV of this poster.

The system does not help out small business owners. It leaves them to a Darwinian system of dog eat dog. Large corporate behemoths OTOH get all kinds of tax breaks, loan opportunities, bypasses on regulations and many other privileges from the suppliers and governments involved that the single proprietor business owners can only dream of. Small business owners like to accept this state of affairs as capitalism and democracy. It's bull shit, yet small business owners have in the past been able to make money, AND pay their employees decent wages because they had some leverage with competition. There is no competition to be had anymore with huge corporate entities and this is why you don't see small stores very much anymore unless in a niche market.

Although as a veterinarian, which is what I believe you are, you aren't competing yet with the likes of the animal version of Humana you probably are losing some business to PetCo who have been offering inexpensive immunizations, neutering and other small services ordinarily handled by a vet. Also, in a large city like LA, you are paying more expensive rents, extra taxes and many other expenses that raise your bottom line. People are making less and aren't spending as much money on their pets as they would like. I know my poor kitty only gets the bare veterinary care he needs just like my car gets the minimum maintenance because my income has not gone up with the cost of living I am faced with.

[kestrel91316]

37. I've done the math and for most of the last 21 years I have actually made less per hour than

most of my employees. I have made HUGE personal sacrifices so that I can pay them a halfway decent hourly part-time wage.

But feel free to carry on with your attack on small business owners.

[Ikonoklast]

42. I could easily expand my operation, purchase more equipment, hire drivers...and take a pay cut.

I would end up working even more and personally earning less, while my employees made more money than I did...while I take all the risks of ownership.

Not even worth it.

[Duer 157099]

43. Advocating for a living wage is equivalent to attacking small biz owners?

Then you've misunderstood my point.

[Yo_Mama]

90. That's a common tale

I know so many small biz owners who weren't earning anything at all during the last recession - but they tried hard not to cut their employees.

Good employees are a necessity for most small businesses.

I think we should raise the minimum wage, but slowly. I think the hordes of fast food/big retail workers need the money.

But it's not a panacea, and if we tried to institute a "living" wage, we'd see millions of jobs destroyed permanently. You can substitute machinery for a lot of service jobs now. It's a bigger up-front investment, but the returns are there, and with the Fed making borrowing so cheap, you will see that money investment.

And then the healthcare legislation is going to raise per-employee costs anyway. If you raise minimum wage a buck an hour and combine that with the Obamacare mandate for larger businesses, the per full-time employee cost will go up 4K a year anyway next year. I expect all the retail chains to go entirely part-time.

Our problem is that people are not only earning too little an hour but that most of them can't get full-time jobs with benefits.

[MindPilot]

40. Minimum wage is the boss's way of saying "if I could pay you less, I would"

Minimum wage should not only be enough to live on, it should be regularly adjusted to the cost of living.

The only employers worried about minimum wage are the ones who already value their employees and their work so little that if they could pay less they would. Fuck 'em.

[gollygee]

41. Small businesses can't afford to pay a living wage when no one else is

but if everyone were earning a living wage, small businesses would make more money and would be on an even playing field.

Right now, if they did they'd go out of business. It's already very difficult for small businesses to compete. But if Walmart had to pay each of their employees a living wage AND mom and pop places had to as well, they should still be able to compete. Plus, people would have more money to spend and could buy more stuff, and be pickier about where they bought it.

It seems obvious to me anyway that the answer to our economic problems is that people have to have enough money to spend money. That means good jobs, and more jobs - or that "full time" needs to be redefined to entail fewer hours so it takes more people to do the same number of jobs - and then of course jobs need to pay better. The rich would even benefit from that, because when the 95-99% have more money, they spend it and it ends up going to the businesses owned by the rich.

Our economy is in trouble because the Republicans created a bad economy on purpose to create an excuse to cut spending. It is not in trouble because jobs pay too well or because people get too much in food stamps. It will not get worse if people get paid better.

Anyway, that's a tangent. The point is that I agree with you.

[bluestateguy]

44. I agree

Owning and running a business comes with responsibilities. Everybody has the right to try their hand as a business owner, but it is not the government's responsibility to prop you up with low regulations and lax oversight.

If raising wages by a dollar or two and hour is going to put you out of business, then your business is probably not all that strong in the first place.

[cali]

50. a dollar or two an hour would NOT raise wages to a living wage anywhere in the country.

there is a difference between raising the minimum wage to say, $10 an hour and a livable wage.

[we can do it]

45. They should not. If they can't pay someone properly they need to do the work their damn selves.

Mom/pop are no exceptions, if they have kids and want them to help out (NOT slave-labor type work) for less while they learn (especially if they are planning on handing the business over, it could be OK) otherwise-NO. I think part-timers need fair pay, too.

[cali]

56. gad.

that's fucking absurd. Yes, to raising the minimum wage but demanding that someone who has a great idea and limited capital pay everyone 16 bucks an hour is counterproductive.

[we can do it]

85. Who said $16? I thought we were talking $10, and a great idea shouldn't need an army of workers.

Unless its taking off.

[NCTraveler]

48. Small business owner here.

All of my employees get a livable wage. Most small business owners I know pay their employees a livable wage.

Many large corps do not. Fast Food for example.

"Oh, but what about the small businesses, the mom-n-pop shops, what about them?!!!"
I have heard this about taxes, not about wages. What are you referencing?

[Duer 157099]

53. I think your experience is typical

It seems that the right-wing likes to rant and rave about things that aren't real issues. This is one of them, that if business have to pay a living wage to employees, then the small biz owners will suffer. I think it's a bullshit premise, but even accepting the premise, I say it isn't an excuse for paying less than a living wage. That's all.

[NCTraveler]

65. See what you are saying and agree.

But I do think there is a big difference between elected members of congress and the real world on this one. Before I became a business owner, my best job and compensation was from a pretty far right winger. I worked pretty insane hours but I was well compensated. I made as much then as I do now as a small business owner. He was also very appreciative and fair. He believed that the compensation would get the most out of me and it did. I learned a lot and was very grateful for the experience. That was for a business that consisted of three people.

But in legislators across the country it is a left/right issue. It is clear that the elected righties don't really give a shit and don't mind people putting in 40+ per week and still not being able to afford simple necessities.

What I am saying is that in the real world of small business, compensation isn't about left or right. There can be very cheap people on both sides of the spectrum. Small business should never use minimum wage as a starting point to set wages. Should be that way in larger business but it is more understandable why they need to have a minimum target wage. That is why minimum wage must be brought up to a livable wage. It is the corps who have thousands of employees who use minimum wage as an excuse to keep themselves "competitive". If minimum wage was raised to a livable wage, their prices would go up, but not to the extent that their wages would be outpaced by the inflation it creates.

I am lucky to not have to concern myself with minimum wage when it comes to my employees. They are very valuable to me and need to know it. And lets be real, they are not here for their love of me. They are here to make a living for their families. And that is important to me.

[NCTraveler]

70. Small businesses are corporations.

I know you are aware of that I am just clarifying it.

I am so unfamiliar with how large corps pay taxes that I don't have an educated opinion on it. It does appear to me that large corps get tax loopholes that small business can't use, mainly due to size and how the tax laws are written. I don't feel my business is overtaxed. I am pretty much paying taxes on payroll and as as owner my distributions are taxed.

Many small business owners shit themselves over taxes and try to learn as much as possible about them. I take a different approach. I pay a payroll company to handle my weekly tax liabilities and a tax firm to do my yearly taxes. I just concentrate on growing my business. When they tell me to write a check, I drop and F bomb, and write it.

[Lint Head]

60. Less than a living wage is shortening lives.

[cali]

63. and the forcing of small business to pay a livable wage

would destroy my state which has one of the highest small business per capital rates, in the country. It accounts for 60% of the workforce here. We have a 5.1% unemployment rate. We have few environmentally damaging businesses. We need our micro businesses and small businesses.

[JCMach1]

61. business regulations are written by big business

And work to the favor of big business. Small businesses are not even an afterthought despite lip service on the right and left.

[cali]

64. Not at all true in my state.

[JCMach1]

96. in FL it is unfortunately

Small businesses have some insane requirements

[Third Doctor]

62. Realistically I doubt

many people would take a job that paid less the current minimum wage (which is too low) in this economy. It costs over $3.50 for a gallon of gas and imo I would not waste my time and cash traveling to the job especially if it was several miles away for chump change.

[forestpath]

71. K&R

[OceanEcosystem]

72. Depends entirely on how much "a living wage" is.

Are we talking $30,000 a year?

$45,000 a year?

$50,000 a year?

[Cleita]

81. I wish there was a formula.

Back in 1958, when I made $1 an hour, I needed a week's wages to pay rent or $40. That was half of $80, that I could get a one bedroom apartment with a roommate. If I didn't mind a one room studio, by myself, then the going rate was $60, less money for other necessities but you could squeeze it out. Back then there was a benchmark that your rent should be a quarter of your wages. Then the benchmark rose to a third of your wages and then a half of your wages as the years went by.

Nowadays, I don't think you can actually pay for a dump for all of your minimum wage, ergo why we have so many working homeless. I really don't know what an average one room place with bathroom and a hot plate costs today, but I don't think $9 an hour for a forty hour week cuts it. That would be $360. I haven't seen any rents that low advertised in my area.

[drmeow]

79. Depending on the type of business

a "Small" business (as defined by the Federal guidelines) can have as much as $35.5 MILLION in annual receipts or up to as many as 1500 employees.

[TygrBright]

82. I would be ashamed of myself if I cheapassed my staff.

I just would. I pay the best I can afford, and it's above both the local minimum wage (and ours is one of the highest anywhere) and the "living" wage. I wish I could pay more. I WILL pay more when I have better cash flow.

And if cash flow goes down, I will cut hours, but NOT the hourly rate. I would rather have my staff have a little more time to pick up work elsewhere as they can, than tie them up many hours for shitty pay. (In fact, when cash flow recedes, as it sometimes does, I try to find other temporary work opportunities they can access. I call around to friends and ask if they can use some help, etc.)

Here's what that gets me: Loyal, smart helpers who feel they have a real stake in how well we do.

I wouldn't trade it for a few more bucks.

irritatedly,
Bright

[Squinch]

86. If they don't pay people a living wage, the taxpayer has to pick up the difference in the

form of food stamps, child insurance assistance, etc. This means the taxpayer is SUBSIDIZING the business owner for his costs of doing business. (Because the business, obviously, needs workers who eat and have a roof over their heads.) If the business owner earns a profit while the employees need public assistance to make ends meet, that means the profit came out of the pockets of the tax payer.

Yes. They should have to pay a living wage. Study after study shows that it helps the economy, and increases the money coming to the small businesses.

[PD Turk]

91. I've owned and operated a couple businesses over the years

Any time I had to hire some help I never paid them less than $10 an hour, I wouldn't have felt right about it. I always figured if I couldn't afford to pay a decent wage I'd better get off my ass and do it myself.I never felt I was owed anything just because I happened to be the owner.

[libtodeath]

97. A living minimum income for all is a basic right.

[L0oniX]

100. Not to worry. US tax payers subsidize them with food stamps and free health care clinics.

The Wal-mart plan. "They get already get food stamps ...so we don't need to pay them more"

That's the big scheme of things in the US ...corporate welfare!

[dkf]

101. Compare the wage you feel people should get with an RFID system that can instantly tally your

purchases and charge your credit card.

Or a robot that costs $20,000 and can be used in manufacturing.

Raising wages makes an eventual changeover more likely.