Increase to minimum wage

Escapees

I came across the RTE news story below just now. While a rise in the minimum wage is good in one respect, I would think it makes life even more difficult for a lot of small businesses struggling to survive with all the other increased costs of late. It amounts to an almost 8% increase in one of their biggest expenditures, at a time when the government should be helping them.

In a way, it's the government making it illegal for such businesses to try to operate/survive as they have been doing, while at the same time gaining favour with employees on minimum wage and also gaining income from the extra taxes that will come in through Revenue. And the joke is, it costs the government nothing, i.e. no outlay or rebate involved!

I'm shocked to be honest and wouldn't be surprised if employers kick it back at them for what it is. But that's me, maybe I'm missing something?!!

https://www.rte.ie/news/politics/2022/0913/1322235-minimum-wage/

igCorcaigh

It's still a real wage decrease for those on the minimum wage.

Any business that cannot afford to pay that wage to their workers, are not a viable business, sad to say. I hope the workers of any business that does close can find employment elsewhere.

Timistry

This will lead to mass closures of businesses already facing a tough times ahead and will only lead to higher prices and an inflationary spiral

EOQRTL

Can see inflation getting completely out of control now worldwide. Incredibly bad numbers out of the US today also with the DOW down 3.9% on the day worst number since the covid crash. This will signal on exodus of small business closures here.

batman75

It's a bit simplistic to say if you can't afford to pay someone the minimum wage then you shouldn't be in business. Ultimately such a move favours big business as the costs of being in business forces smaller ones out which ultimately reduces consumer choice. Add in the cost of paying staff out sick and it all makes being in business increasingly hard.

Ultimately it will lead to higher prices for the consumer and possibly less employment as business try to cut manpower to counteract the increase in costs. The expectation is that at some point in the next year energy and fuel prices will ease off so business can hopefully absorb these until they do.

Geuze

Plenty of firms are very profitable, and can easily afford wage increases.

As well as hearing calls for wage restraint, I would like to hear calls for profit restraint.

Pharmacies, busy urban pubs, and loads of other firms are very profitable.

AAM has plenty of examples of small firms with 100k+ pa profits.

The cafe I go to increased the price of tea by 36%, so they can afford to increase the wage by less than 10%.

ittakestwo

The reality is you cant get staff at minimum wage . As said before if a Bussiness cant afford to pay this then they're not viable in 2022. Minimum wage came in in 2000. Since then it has not increased with even with what the average wage increased by in that period You would think in a first world country we be aiming to close not increase the gap between rich and poor.

Studies have always shown that an open door policy to immigration like Ireland's suppress pay in lower paid work more than high paid. lmmigration kept minimum wage increases lower here for the last two decades. Now because of the housing crises people cant come here to fill lower paid jobs as they're being priced out of accommodation by people on higher incomes. I actually this is great for unskilled workers providing they have a place to live. The cheap supply of inwards Immigration is not coming in now. Supply and demand of labour works in the same way as other things to determine its price.

Senature

Accommodation being unavailable and vastly overpriced is not fixed by increasing minimum wage. All this will do is increase consumer prices and push struggling businesses over the edge. Most businesses pay most people higher than the minimum wage already, this increase is useless to most, and akin to an instagram post that's fishing for likes.

Does anyone think an inexperienced 18 year old student living with their parents needs to earn this level of wage as they learn how to stack shelves in a local newsagent or are sweeping the floor at the barber? It's bananas.

MayoSalmon

The real minimum wage is 0

timmyntc

https://www.boards.ie/discussion/comment/119615411#Comment_119615411

The cafe I go to increased the price of tea by 36%, so they can afford to increase the wage by less than 10%.

When their energy bill has increased >70% I doubt they can afford any increases to wages at all

Red Silurian

I bought a 2L of milk yesterday in my local supermarket for €2.09, it was €1.49 last year. That's a 40% increase. Electricity and gas prices went up 3 times this year, most recently by about 40% also. That's 2 examples, there are many many more examples of double-digit % rises in prices of necessary goods

A minimum wage increase of 7.6% is actually laughable in that respect

Red Silurian

https://www.boards.ie/discussion/comment/119615941#Comment_119615941

There will be government interventions for that cafes electricity bill

rob316

https://www.boards.ie/discussion/comment/119616420#Comment_119616420

Your presuming every business is passing on the costs, they aren't I assure you. Its a considerable cost increase for a small business struggling already, roughly €1800 pa for a full time employee.

Sure big operators can afford it but what about a coffee shop or local shop?

enricoh

https://www.boards.ie/discussion/comment/119616420#Comment_119616420

Do u think 1.49 for 2l of milk is a fair price for it? I certainly don't it's about time dairy farmers got a fair price for their work.

If you put up a poll saying should the minimum wage be increased to E15 I reckon 80% + would vote yes. Then they'd complain about the prices in the supermarket n head to Newry instead!

rob316

https://www.boards.ie/discussion/comment/119616422#Comment_119616422

Many have trebled in costs, how much intervention can a business realistically expect? They are still going to be paying multiples of previous bills.

Wanderer78

good to see, but sme's need direct help, and fast, or it ll be dole for many employees and employers!

SAMTALK

https://www.boards.ie/discussion/comment/119616450#Comment_119616450

I work in a medium sized company and they are increasing costs constantly (cant say industry as it's quite small area) .

For every elec increase they have added to products, and they are making massive profits but yet majority of workers are on not much more than min wage.

I am sick of listening to them going on about all the increases, we are all facing increases yet my wages havent changed at all

Most coffee shops in my are have increased prices and to be honest it won't be long before cafes and restaurants get quieter

blanch152

https://www.boards.ie/discussion/2058263242/increase-to-minimum-wage

There won't be any gain in income from the extra taxes as those on the minimum wage don't earn enough to pay income tax.

Escapees

I was thinking USC rather than income tax, but even min wage earners can pay income tax if they work more than 40 hours in a week...

McGrath5

Every time there is an increase to the minimum wage employer's groups cry wolf.

I heard a piece on the radio this morning that some employers will reduce staffs hours to compensate, well I hope any staff that work in a place like would leave for a better employer if anyone tried a stunt like that.

Starfire20

https://www.boards.ie/discussion/comment/119615875#Comment_119615875

If the 18yr old is doing the same work as an older "more experienced" worker, of course they should get the full wage.

them living at home with parents is irrelevant. They're still giving the same hours of their life to the business.

people accept that the cost of materials etc rise and put it down to the cost of doing business but if the cost of labour goes up,thats unacceptable.

that kind of thinking has to change.

If I'm not mistaken, don't minimum wage workers account for 5% or less of the working population?

So could somebody explain to me how increasing wages by a mere 80 cent per hour in 5% or less of the population could increase inflation for the other 95% of the working population?

Escapees

https://www.boards.ie/discussion/comment/119616763#Comment_119616763

5% sounds like BS to be honest, but I don't know the actual figure off-hand. There's a large amount of folk working in retail and hospitality who definitely would be on the min wage rate.

Speaking of stats being quoted here, as a by-the-way, someone mentioned earlier that the average wage had risen at a higher rate than the min wage over the last 20 years. I looked into this afterwards and found it to be untrue, at least based on the rise over the last 20 years. The average industrial wage actually only rose by approx 30% in this period whereas the min wage rose by approx 60%, based on CSO figures! I'm not saying the min wage is adequate, but just that there are statements being made and figures bring given relating to the min wage which are totally untrue and misleading...

Sorry, I should have linked to the actual stats in my last post as of the end of 2019. The amount of workers earning the minimum wage or less stood at 6.4% according to the CSO.

https://www.cso.ie/en/statistics/labourmarket/lfsnationalminimumwageestimates/

eeloe

https://www.boards.ie/discussion/comment/119615411#Comment_119615411

the price of the tea has gone up 36%, but their energy prices have already gone up 2-300%.

Geuze

https://www.boards.ie/discussion/comment/119617814#Comment_119617814

The figure is around 5-7% of workers.

MW workers are concentrated among younger workers, students, etc.

Red Silurian

https://www.boards.ie/discussion/comment/119616698#Comment_119616698

Wages up 7.6% Vs ESB/Gas up 300%

They might be getting shorter hours if a premises decides to close early or open later in the day or not open on a particular day of the week at all... But that will have very little to do with the increase in the minimum wage I recon

Escapees

https://www.boards.ie/discussion/comment/119617848#Comment_119617848

Wow, my bad! Thanks for linking the source. I'm really surprised that it's that low...

jrosen

Will it have a knock on effect to other low paid workers? If suddenly now the junior staff member is earning 11.80 the person who's there 2 years is going to want more than that and so on.

Danno

https://www.boards.ie/discussion/comment/119616763#Comment_119616763

It's not that simple, businesses are shrewd - they know the rate of minimum wage and they know the rate of minimum Social Welfare and these rates set a floor on prices charged for goods and services. Hence in Ireland, the stuff you'd see in shops for half the price in say Spain is because these prices are calculated by what the market can bare. It's not necessarily the retailer or the sole trader setting these floor prices all the time - suppliers, distributers and manufacturers will all set prices along the chain knowing what money is "sloshing" around in the market and seek to capture as much of this as possible with an odd look over the shoulder at their competition.

A simple look at this is the The Big Mac index | The Economist

https://www.boards.ie/discussion/comment/119614848#Comment_119614848

Blatant "pay up or fook off" statements like this feed in to the hard-left way of thinking. Imposing harsh conditions on small businesses in particular and thus grinding them down to a situation where they're better off closed is a loose-loose situation. You put both the owners of the business and their employees on social welfare and instead of having a few, albeit small tax incomes - you now have a minimum €11K annual bill to pay out in welfare (€208X52) per employee.

But then again, the hard-left love big government and would rather all businesses were nationalised, and everybody was on UBI regardless.

batman75

The next 12 months will see a lot of casualties in retailing here. Spending has plummeted, costs are spiralling. We're most likely to see a recession next year.