Ignorance of Minimum Wage
Simple Math Evades People
As of now, some are freaking out about proposals to minimize the damage from minimum wage laws (https://nebraskaexaminer.com/2025/05/28/bill-weakening-nebraska-paid-sick-leave-passes-but-dems-stall-effort-to-slow-minimum-wage-growth/).
The vast majority of people have no idea of the purpose of a career ladder. Not everyone wants a living wage. Many want mere spending cash, while others want to go way above a “living” wage. How you value life and how you apply your talents will determine where you end up at. A 14-year-old teenager does not need the same amount as a 30-year-old father with three children. Yet, minimum wage merely assumes the wage is the only measure of how workers receive benefits and income.
Let me run a math problem for you. Which would you rather do? Work 50 hours at $13 an hour, or 30 hours at $15 an hour? More importantly, what do you think an employer wants to pay? Keep in mind, the employer pays about 7.6 percent above the wage for FICA benefits.
At 50 hours a week, you receive benefits and overtime pay. The total comes out to be $750. But $15 is better, right? Nope. At $15.00 an hour, you earn $450, and you have no benefits. Yet voters voted for $15.00 minimum wage.
And this becomes much more problematic with pay raises. At $13 an hour, a nice pay raise is easy, but not so much at $15.00 an hour. Think about this. At the lower wage, an employer can provide a higher promotion of 5 to 10 percent. But at the mandatory higher wage, these promotions trickle down to 2 to 5 percent and over a longer period of time. Realistically, the advocates for the minimum wage laws think they are trying to get you off a hamster wheel on wages when in reality, they are forcing workers on to it and speeding the wheel up. Instead of increasing wealth, the employee ends up being where they started at if not worse.
The tension between the two wages exists, although it may not be nearly as obvious. Some employers are proactive in reacting to minimum wage law changes, while others take a wait-and-see approach, and some employers ignore it and wait for the problem to hit them. Studies have difficulty measuring this, but they do know it hurts entry-level jobs.
There are other vicious ways employers have to deal with minimum wage jobs, such as effectively banning certain groups. Want to work ten hours a week for spending cash to pay off some bills or buy something fancy? With a hike in minimum wage, employers may only accept those willing to work 25 hours a week instead of 12 hours, previously allowed. You are a teenage boy, but the employer really does not want to invest in teenagers, unless you prove your ambition by working Friday and Saturday night, which would kill off social life for the vast majority of teens. End result, teens do not apply for the job, and the “hiring” sign remains on the business door.
People would be stunned by how many businesses make very modest profit margins. For such businesses, they do not want to upset employees, but they find they have to adjust quickly but modestly. The business may slightly raise prices on a few items, modestly change pay raises, and be more willing to provide downtime or unpaid days off.
These realities play out in the real world, and as much as people try to dismiss them or forget them, the pain is real. Our economy is narrowed and the career ladder is ruined by minimum wage and the hikes. People need to learn the realities.