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Wednesday, February 22, 2006

Minimum Wage Reality...

From: John F. Brinson
Sent: Wednesday, February 22, 2006 2:19 PM
To: PA General Assembly
Subject: Minimum wage

Dear Friends in the Pennsylvania Legislature:

An increase in the minimum wage would do great harm to PA business, especially small businesses such as mine. I employ over 300 part-time hourly workers, all of whom already earn more than the minimum wage. They are students, homemakers, and retired people who want to earn a little extra spending money.

Our average hourly worker earns $8.31 already ($5.25 for beginners, and as much as $13.00 per hour for experienced). If you mandate an increase of $1.00, my payroll will increase by 12%, because ALL hourly wages will be pushed up. An increase of $2.00 would increase my hourly payroll by 24%!

You would leave me with two choices: ... increase prices to cover the increased hourly wages, or ... lay off all workers who earn under $6.15 ($7.15)

I cannot increase prices enough to begin to cover the increase. Therefore, I would lay off all those under the minimum wage, and demand more from the remaining workers.

THERE IS NO FULL-TIME WORKER OUT THERE WHO IS TRYING TO SUBSIST ON $5.15 PER HOUR. YOU ARE TRYING TO HELP PEOPLE WHO DO NOT EXIST! The average household income of minimum wage earners is over $50,000 per year.


John F. Brinson, CEO
Lehigh Valley Racket & Fitness Club


Anonymous said...

What planet do you live on where there is no full time workers making $5.15 an hour? Just because no one you know is below poverty level, does not mean it does not exist. There are single mothers who are trying to raise their child because the father is too lazy to help out or for one reason or another the father is no longer around. They don't have money to go to your high and mighty "Fitness Club" aka Ripoff Club. I be your employees would like to see a raise in the minimum wage, instead of seeing some CEO rake in the big bucks while they do all the work. Open your eyes and look around. Poor people do exist!

Nathan Benefield said...

Dear Anonymous,

While your passion for helping children with single mothers and lazy father is evident, increasing the minimum wage is not an effective anti-poverty tool.

The facts are this:
Most minimum wage workers are under 24, almost half live with their parents, and less than 10% are a sole earner with children. Very few live in poverty, with a majority living in households earning over $35,000.

In those rare cases where a minimum wage worker is attempting to raise children on her/his own, that single parent will be eligible for thousands of dollars in Food Stamps, Medicaid, Housing Assistance, TANF cash grants, the Federal Earned Income Tax Credit, and other sources which target only poor households. The minimum wage does not.

The most important fact you ignore is that raising the minimum wage will cost jobs among those same workers proponents promise to "help". Businesses will have to pay for the additional costs, either by raising prices, losing profit (which for most small businesses is quite small) or by eliminating workers. While many workers may want a minimum wage increase, as you so eloquently argue, few would be willing to sacrifice their own job for one.

Anonymous said...

Again you are not living in the real world. $35,000 is not the norm for many workers in Central Pennsylvania. You are so worried about losing money out of your own pocket that you have lost touch with the truth.

Anonymous said...

Glad to see an argument using numbers regarding who is employed at minimum wage etc. I won't doubt their veracity without my own research. But,despite your assertion (which is always made when an increase is proposed)that an increase will only hurt those making it historically it NEVER has.