New wage boost puts squeeze on teenage workers across Arizona

[Logan13]

I told you guys that this would happen, in fact I was dead-on. Now multiply this by 50 states and you are looking at a large increase in the unemployment rate.

New wage boost puts squeeze on teenage workers across Arizona
Employers are cutting back hours, laying off young staffers
http://www.azcentral.com/news/articl...nwork0210.html
02/10/07

Oh, for the days when Arizona's high school students could roll pizza dough, sweep up sticky floors in theaters or scoop ice cream without worrying about ballot initiatives affecting their earning power.

That's certainly not the case under the state's new minimum-wage law that went into effect last month.

Some Valley employers, especially those in the food industry, say payroll budgets have risen so much that they're cutting hours, instituting hiring freezes and laying off employees. advertisement

And teens are among the first workers to go.

Companies maintain the new wage was raised to $6.75 per hour from $5.15 per hour to help the breadwinners in working-poor families. Teens typically have other means of support.

Mark Messner, owner of Pepi's Pizza in south Phoenix, estimates he has employed more than 2,000 high school students since 1990. But he plans to lay off three teenage workers and decrease hours worked by others. Of his 25-person workforce, roughly 75 percent are in high school.

"I've had to go to some of my kids and say, 'Look, my payroll just increased 13 percent,' " he said. " 'Sorry, I don't have any hours for you.' "

Messner's monthly cost to train an employee has jumped from $440 to $580 as the turnover rate remains high.

"We go to great lengths to hang on to our high school workers, but there are a lot of kids who come in and get one check in their pocket and feel like they're living large and out the door they go," he said. "We never get our return on investment when that happens."

For years, economists have debated how minimum-wage increases impact the teenage workforce.

The Employment Policies Institute in Washington, which opposed the recent increases, cited 2003 data by Federal Reserve economists showing a 10 percent increase caused a 2 percent to 3 percent decrease in employment.

It also cited comments by notedeconomist Milton Friedman, who maintained that high teen unemployment rates were largely the result of minimum-wage laws.

"After a wage hike, employers seek to take fewer chances on individuals with little education or experience," one institute researcher told lawmakers in 2004

Tom Kelly, owner of Mary Coyle Ol' Fashion Ice Cream Parlor in Phoenix, voted for the minimum-wage increase. But he said, "The new law has impacted us quite a bit."

It added about $2,000 per month in expenses. The store, which employs mostly teen workers, has cut back on hours and has not replaced a couple of workers who quit.

Kelly raised the wages of workers who already made above minimum wage to ensure pay scales stayed even. As a result, "we have to be a lot more efficient" and must increase menu prices, he said.

While most of the state's 124,067 workers between the ages of 16 and 19 made well above $5.15 per hour before the change, the new law has created real-life economic opportunities.

Liliana Hernandez brings home noticeably more under the new law. The 18-year-old, who attends Metro Tech High School in Phoenix and works part time at Central High School, is saving the extra money, maybe to put towards buying a used car.

Hernandez said she deserves the raise just like any other Arizona worker even if she still lives with her parents.

"I'm doing the best I can and working hard like everyone else," she said.

In the months leading up to last November's vote, advocates of the new law maintained that it would help Arizona create a "living wage" for some of the poorest workers.

The Economic Policy Institute estimated that 145,000 Arizonans would receive a pay raise. That was how many made $5.15 to $6.74 per hour.

At one press conference, a mother described how she was unable to afford basic school supplies for her son.

Opponents, however, said there was little talk about teenage workers. "Everyone wanted to focus on the other aspects of the minimum-wage campaign," said Michelle Bolton, Arizona state director of the National Federation of Independent Business.

An Employment Policies Institute study determined that 30.1 percent of affected workers in Arizona fell between the ages of 16 and 19.

"Workers affected by the minimum-wage increase are less likely to be supporting a family than the typical Arizona worker," it stated. "For example, 30.4 percent of the workers are living with their parent or parents, while only 7.6 percent of all Arizona workers are in this category."

John Weischedel, a senior at the East Valley Institute of Technology in Mesa, knows he is lucky to be making $8 per hour at an auto dealership and learning technical skills. So are most of his friends who make $9 or more per hour while still attending high school.

After the minimum-wage law went into effect, "a couple of my friends got laid off - they worked in fast food," he said. "They're going to wait until they're out of high school to find other jobs."

[DTBusta]

Proves that Bush's economy isn't anything to brag about. Thanks to the inflation since 02, we now see the obvious when it happens. I said this was going to happen, because while our economy may look strong its extrememly fragile.

[Logan13]

Proves that Bush's economy isn't anything to brag about. Thanks to the inflation since 02, we now see the obvious when it happens. I said this was going to happen, because while our economy may look strong its extrememly fragile.

Seriously, you are lost DT. How can you conclude that from this article. Do a little research, your personal opinions do not equate to proof in my book. The economy is actually kicking ass, sorry that you missed it. This is simple economics.

[DTBusta]

bro when the economy can't support a simple wage increase its not kicking ass.

http://www.msnbc.msn.com/id/16302964/


please don't insult me when experts say it is a fragile economy!





The fed is having a hard enough time controlling inflation let alone growth. Compare us to Chinas growth and we are def not kicking ass.Your not the only one that has a view on the economy or politics for that matter Logan, so get a hold of your self.

[DTBusta]

Add a possible war with Iran, and if Iraq gets worse and we will be kicking even less ass.

[J.S.N.]

lol with the margins on pizza, if you can't cope with a wage increase of under $2 an hour you are a retard. places like mcdonald's aren't profitable per store because the franchise ****s the owners. the kid that makes $6 a hour can easily sell that much in product in 30 seconds.

[Kärnfysikern]

I think its kind of ridicilous to raise minimum wage for teen workers. The raise should only apply for adults.

[Logan13]

I think its kind of ridicilous to raise minimum wage for teen workers. The raise should only apply for adults.

My left-leaning counterparts campaigned on this. Problem is the vast majority of those actually making minimum wage are high school and college students. I do agree with your idea of this applying to adults only, but then you will have certain individuals screaming that the wage increase is discriminating against them. Seriously, who doesn't want their fellow citizens making as much money as possible. But when the general public does not have an idea as to how a business is run, you get comments like "how can they not just absorb a $2 increase per hour per employee. Again, simple economics. This wage increase amounts to a 39% increase in wages, per employee. Not to mention that labor is most likely his/her largest expense already. Any sane business person is not going to simply "absorb" it, he will either decrease the workforce and have them all do more work and/or he is going to increase his prices on his goods or services. Since minimum wage is going to affect mostly those in small businesses(sole proprietorship and general partnerships), not big corporations (remember almost all of those fast food places out there are franchises owned by local individuals), it is your neighbor who is going to have to fork out the extra cash for the local college students to do the same job that they did last year, but now for 39% more money. Again, this goes beyond what makes you feel good DT and JSN, this is the real world.

[Logan13]

Add a possible war with Iran, and if Iraq gets worse and we will be kicking even less ass.

perhaps you should just move out than, since it is apparent that you are not happy here.

[singern]

please don't insult me when experts say it is a fragile economy!



.

Its always a fragile economy.... you cannot name one single presidency that didnt have to deal with an economic issue crisis of some kind. The economy is cyclic and inherently unstable.

Even the .COM boom of the 90's that Clinton had, was a temporary phenomenon. But I dont see anyone blaming him for its collapse.

[Logan13]

Its always a fragile economy.... you cannot name one single presidency that didnt have to deal with an economic issue crisis of some kind. The economy is cyclic and inherently unstable.

Even the .COM boom of the 90's that Clinton had, was a temporary phenomenon. But I dont see anyone blaming him for its collapse.

just throw facts at them and they will crawl away...........

[DTBusta]

right ok, I said it was fragile and he said it was "kick ass".Thankyou for the agreement.A soft housing market, soft manufacturing, a falling dollar, rising inflation, recession on the way, negative savings rate, increasing debts, an aging baby boom population, peak oil and, the granddaddy of them all, global warming? Clearly, none of this matters or the Dow wouldn't be at a record high.

[DTBusta]

you can only run away from reality for so long.If we were doing so well than we wouldn't have had to secure oil militarily. Now its backfiring, Bush now finally admits war isn't going well. Problem is 130,000-600,000 dead people died for either a mistake or on purpose and its about time that question is answered.The only thing you got me on is the cost and in effectiveness of alternative energy. So expensive to build yet we have the cash to wage an endless war. When will this country start profiting from the Iraqi oil?when the war is over?Oh yeah right I forgot"mission accomplished"

[Logan13]

you can only run away from reality for so long.If we were doing so well than we wouldn't have had to secure oil militarily. Now its backfiring, Bush now finally admits war isn't going well. Problem is 130,000-600,000 dead people died for either a mistake or on purpose and its about time that question is answered.The only thing you got me on is the cost and in effectiveness of alternative energy. So expensive to build yet we have the cash to wage an endless war. When will this country start profiting from the Iraqi oil?when the war is over?Oh yeah right I forgot"mission accomplished"

see, I knew that you could not stay within the topic...........

[DTBusta]

Because its one administration. Its one economy. The Iraq war for better or worse has changed both. I will try harder to stay focused on the topic by itself in the future....I was on topic two posts ago, that applies to why we can't handle wage increases.


I don't want to move out. I want to see us succeed in Iraq(Isn't that off topic?), I am a registered republican, I used to be pro war, until I saw how they took advantage of misleading intelligence. Thats the american way I guess but still want to see this thing get finished and us get out. If the oil helps keep our economy going then good for that.I just think its pothetic to see hundreds of thousands die for no justified reason. This "war on terror" has opened pandoras box don't you atleast agree with that?

[singern]

right ok, I said it was fragile and he said it was "kick ass".Thankyou for the agreement.A soft housing market, soft manufacturing, a falling dollar, rising inflation, recession on the way, negative savings rate, increasing debts, an aging baby boom population, peak oil and, the granddaddy of them all, global warming? Clearly, none of this matters or the Dow wouldn't be at a record high.

Like I said, there is always some form of economic issue. But why dont you
recognize that the stock market is at an all time high, or that unemployment is down, job creation is up, and the housing market is stabilizing rapidly.
There is always a dark side, but likely at this point in time there is also a very bright side.

[DTBusta]

Intrest rates will mostly be hiked again in the coming months. The housing market is beginning to stabalize, but many in the market place say a recession is near. I agree 100% now, better to look at the bright side.There will most likely always be a doomsday senerio to this war and economy hope they still have our intrests at hand is all.

[J.S.N.]

Like I said, there is always some form of economic issue. But why dont you
recognize that the stock market is at an all time high, or that unemployment is down, job creation is up, and the housing market is stabilizing rapidly.
There is always a dark side, but likely at this point in time there is also a very bright side.

the economy is doing better on paper recently, however, we still haven't recovered the jobs lost since bush took office, and in reality when the median HH income is falling, stock market increases don't mean much except to the relatively few people who own alot of stock.

this talk about protecting adults' but not teens' income is dumb. teens can have children and families, can they not? they perform essential tasks for our economy but should only be entitled to 5$ an hour? that's ****ed. no wonder people steal out of the registers.

[Logan13]

the economy is doing better on paper recently, however, we still haven't recovered the jobs lost since bush took office, and in reality when the median HH income is falling, stock market increases don't mean much except to the relatively few people who own alot of stock.
It would be naive to think that 14 million illegal immigrants in this country are not effecting our hh income, as well as our poverty rates(which is still at a lower rate than poverty rate of the 80's and 90's)The unemployment rate averaged 5.8 percent in 2002, which accounts for the $500 drop in median hh income between 2001 and 2002. Unemplyment is now a full percentage less, which explains part of the increase in median hh income in 2004, 2005, and 2006.
this talk about protecting adults' but not teens' income is dumb. teens can have children and families, can they not? they perform essential tasks for our economy but should only be entitled to 5$ an hour? that's ****ed. no wonder people steal out of the registers.

how much would you pay them, what figure would be fair in your eyes.......?
$10, $20, maybe $30/hour?

[Kärnfysikern]

the economy is doing better on paper recently, however, we still haven't recovered the jobs lost since bush took office, and in reality when the median HH income is falling, stock market increases don't mean much except to the relatively few people who own alot of stock.

this talk about protecting adults' but not teens' income is dumb. teens can have children and families, can they not? they perform essential tasks for our economy but should only be entitled to 5$ an hour? that's ****ed. no wonder people steal out of the registers.

Most teens are high school kids working over the summer to be able to buy a a b-box. Those teens that do have a family probably get help by other means. I dont se why a small minority of teen parents should set the wage level for everyone.

[biglouie250]

Logan13 is correct. this is an issue we agree on. raising min wages is a horrible idea under the current conditions. unemployment has risen....more claims for unemployment wages.... its simple economics, when you create a price floor(min wage) above the equilibrium you create a surplus of demand for labor but decrease the supply of labor...... hence unemployment goes up. it has nothing to do with having a fragile economy. the market has done well the past year. you really had to try to lose money in the market last year. ive done 30 tax returns thus far and none had capital losses from short term investments ....

[J.S.N.]

how much would you pay them, what figure would be fair in your eyes.......?
$10, $20, maybe $30/hour?

$18 is generally agreed to be a living wage in america, so that.

[Kärnfysikern]

$18 is generally agreed to be a living wage in america, so that.

So a 15 year old wiping the floor of the local church to get some cash during summer should earn 18$/hour?

Im a big advocate of minimum wage. But I dont se why it should involve teens and kids. If it does high school kids wont be able to find any work during summer break anymore.

[Logan13]

$18 is generally agreed to be a living wage in america, so that.

Maybe in a socialist country. Our economy is market driven, and that level will NEVER be met with 14 million illegals willing to work for $6/hour here in the states. That is counter intuitive. Tell us when you own a business, I'll send my kid over there for $18/hour to wash dishes. After doing that, let me know how your bottom line looks..........So if your entire staff was making $18/hour in a restaurant, does that mean that a burger and fries will cost me $36? Who wins with that scenario? When you increase costs, you must also increase the sales cost to your customers. Everyone gets raked in your scenario.

[DTBusta]

Logan I just realized this but I was saying the same thing basically. Horrible conditions to higher these specif wages, however it is fair game to also point out an economy that can't handle such raises as not completely kick ass.?

[Logan13]

Logan I just realized this but I was saying the same thing basically. Horrible conditions to higher these specif wages, however it is fair game to also point out an economy that can't handle such raises as not completely kick ass.?

no, it's not. It has nothing to do with the stability of an economy. Would you like to wake up tomorrow to the headline that gas is going to be $4.50/gallon until they decide to raise it again. Could you handle such an increase?
You cannot increase costs by 40% and expect a small business owner to just absorb it. Could your budget handle a 40% across the board increase in the cost of goods and services, tomorrow?

[Kärnfysikern]

4,5$ gallon. Bah thats nothing try 5,5$-6$/gallon that is the price in sweden.

[J.S.N.]

So a 15 year old wiping the floor of the local church to get some cash during summer should earn 18$/hour?

yes... or the priests themselves can do it or they can find volunteers.

Im a big advocate of minimum wage. But I dont se why it should involve teens and kids. If it does high school kids wont be able to find any work during summer break anymore.

kids in america have to pay for college(or our parents do). why should a kid whose parents can't afford it have to incur debt that may last them years after they graduate? you can't sit there and distinguish for every given person how what they need to live. when that's the case every time you see the people who need jobs the wrost being passed over for cheap labor. the unfairness comes from having to compete with cheap labor, not from the lack thereof. too many people want shit done for unreasonably cheap prices. is it one's right to have one's lawn ladscaped for some ridiculously low price because poor ass mexicans who've been pwned by NAFTA are willing to do the work for crap compensation? that's a really ****ed situation.

Maybe in a socialist country. Our economy is market driven,

the "free market" is purely rhetorical. there are all kinds of restrictions placed on our economy and govenment control backed by institutional violence to make people participate. why can a state like finland, austria or japan provide such a great living and america can't? because we're the postindustrialized world's dumping ground. when you want cheap labor, you come here. that sucks.

[DTBusta]

No I'd be just getting by.However my employees deserve an increase, this new minumum wage initiative would put me back 5 % my accountant and I came up with.However It doesn't effect me since any employee who works for me makes 10-30 an hour.


Although my goods and services offered are a talent and a bakery. I'm not taxed on the baked goods.

[Kärnfysikern]

But there is still the fact that if the church floor wiper has to be paid 18$ hour he wont get hired. So the high school kid doesnt get his new x-box game. Paying teens that high salary seems kind of ridicilous. Id say the avarage salary for teens doing crap jobs over summer here in sweden is around 7$.

I consider someone a adult when they pass 18 so it would not effect university students working on the side while studying.

How can 18$/hour be considered minimum. Id say that 11$ is a more reasonable limit. I could live on 12$/hour when I worked as a personal assistant for disabled. That is the avarage salary for people in early 20's over here.

Seems like a lose lose situation.

[J.S.N.]

But there is still the fact that if the church floor wiper has to be paid 18$ hour he wont get hired. So the high school kid doesnt get his new x-box game. Paying teens that high salary seems kind of ridicilous. Id say the avarage salary for teens doing crap jobs over summer here in sweden is around 7$.

I consider someone a adult when they pass 18 so it would not effect university students working on the side while studying.

How can 18$/hour be considered minimum. Id say that 11$ is a more reasonable limit. I could live on 12$/hour when I worked as a personal assistant for disabled. That is the avarage salary for people in early 20's over here.

Seems like a lose lose situation.

you have to keep in mind that the government's role is to provide services for it's populace. why make an economic system where people choose between being poor as **** and having nothing? i don't know as much about life in sweden, but here in america (**** yeah) we have huge surpluses of food, materials, land, etc. the problem isn't that kids working shit jobs like mcdonald's employees make too much. they are actually performing a service. the problem is hat there are certain members of society who contribute nothign or close ot nothign but are allowed to make lots of money based on having money to begin with. say you own alot of stock in mcdonald's (like $30million) you don't do anything but own the stock. it's backed by dollars which are pieces of dyed paper worth about $.00002 in real value. you as a stockholder don't have to do anything to make money off your money whereas the guy the franchisee, the kid who warms the food and takes your order, the the argentine rancher, the meat processor, the truck driver, all these people are actually making the food come together at mcdonalds, yet you as a stockholder are taking in a large amount of money simply based on an abstract claim to mcdonald's profits.

why is john q. stockholder allowed to control these resources? what benefit does it bring society? the market is supposed to be a resilient economic system where demand stimulates sectors to satisfy the demands, but when resources are allowed to be tied up by people who don't do anything, it doesn't function properly. i don't advocate a completely free market, because there are things people want that can affect the rest of us in an extremely negative way, but i don't like a system where people are allowed to horde resources and hegemonic power for the benefit of their very small section of the population.

[Logan13]

you have to keep in mind that the government's role is to provide services for it's populace. why make an economic system where people choose between being poor as **** and having nothing? i don't know as much about life in sweden, but here in america (**** yeah) we have huge surpluses of food, materials, land, etc. the problem isn't that kids working shit jobs like mcdonald's employees make too much. they are actually performing a service. the problem is hat there are certain members of society who contribute nothign or close ot nothign but are allowed to make lots of money based on having money to begin with. say you own alot of stock in mcdonald's (like $30million) you don't do anything but own the stock. it's backed by dollars which are pieces of dyed paper worth about $.00002 in real value. you as a stockholder don't have to do anything to make money off your money whereas the guy the franchisee, the kid who warms the food and takes your order, the the argentine rancher, the meat processor, the truck driver, all these people are actually making the food come together at mcdonalds, yet you as a stockholder are taking in a large amount of money simply based on an abstract claim to mcdonald's profits.

why is john q. stockholder allowed to control these resources? what benefit does it bring society? the market is supposed to be a resilient economic system where demand stimulates sectors to satisfy the demands, but when resources are allowed to be tied up by people who don't do anything, it doesn't function properly. i don't advocate a completely free market, because there are things people want that can affect the rest of us in an extremely negative way, but i don't like a system where people are allowed to horde resources and hegemonic power for the benefit of their very small section of the population.

It sounds as though you are not a good fit for a capitalistic society. That invested money comes from somewhere, go out and earn some yourself. Try it, you may like it.

[J.S.N.]

i have plenty of money thankfully, although i haven't really done much to earn it. i wish i were born with millions upon millions though. then i could really do something. almost anything, in fact.

actually i should say i've done the wrong things to earn it. i created alot more wealth working summer jobs in college than i've done with any real job.

[DTBusta]

Im with the overwelmingly conservative Lou Dobbs on this one and against Bush mainly for this reason. Bush and his "war on terror" hasn't even made it seem like he wants the borders closed. Hes the one that would have support behind him from the conservatives if he did this. He should throw those people a bone every now and then and do something that they want on their agenda. And its not like its un founded. Bush himself says alqueda and drug lords are packing drugs and weapons over the border. My guess is they need the black market in this country as far as drugs go, so thats why they aren't bothering to enforce it with either a fence or the right amount of man power.Yes the illegal immirgrants are flowin g over here and bush wants to keep them illegal for cheap labor. Problem is which is also not unfounded the dems for the most part want to legalize them.If they do this it wouldnt make sense because now they have to pay them min wage and health insurance. Why do this? there is no clear answer but to stop them at the border for once and for all and stop draining the natural resources out of mexico.