Min­i­mum-wage hike helps busi­ness rev­enue

Orlando Sentinel - - OPINION -

The Jan. 11 ar­ti­cle about the eco­nomic out­look for 2020 (“Econ­o­mist pre­dicts strong 2020, but wary of wage amendment”) over­looked the ba­sic fact that seems to es­cape all com­menters. When a wage in­crease — say, to $15 – is im­ple­mented, the cost for each item of pro­duc­tion or sale, a ham­burger or clean­ing a room, is very slight. That’s be­cause the hourly cost of salaries is spread over many units. How­ever, the full amount of the work­ers’ take-home pay is con­trib­uted to the econ­omy in the form of in­creased spend­ing power of the wage-earn­ers.

The cries of eco­nomic dis­as­ter com­ing from busi­ness groups are shal­low logic. Ev­ery dol­lar paid to our work­ers, par­tic­u­larly the low­est-paid, will be re­turned to the econ­omy in the form of in­creased rev­enue across the board for all busi­nesses. Yes, some sec­tors will see more ef­fect in in­creased prices; for ex­am­ple, in our se­verely lim­ited rental hous­ing mar­ket, a greedy land­lord will see the chance to in­crease rents. But that’s a prob­lem that ex­ists re­gard­less of cur­rent or pro­jected min­i­mum-wage rates, and it calls for its own so­lu­tion.

At the bot­tom line, we need a min­i­mum wage that pro­vides a de­cent life for all our cit­i­zens, and we need to have com­pres­sion to re­duce the dis­par­ity be­tween the top and the bot­tom of the wage scale. The in­crease at the bot­tom need not au­to­mat­i­cally gen­er­ate a cor­re­spond­ing in­crease at the top. Gra­da­tion of increases across to or­ga­ni­za­tion would be fair to all and ben­e­fi­cial where it’s needed to most.

Bill Thomp­son Apopka

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