Slugger O'Toole

Conversation, politics and stray insights

Could raising the minimum wage hurt NI?

Tue 21 January 2014, 5:49pm

Last week the Tories did do a masterful job of combining their message of a growing economy with fairness by arguing that the minimum wage should rise from £6.31p to £7 per hour.

As the IMF pointed out today prospects for the British economy are looking better but we have to remember that Britain is hardly enjoying a balanced recovery as most of the job creation still goes on in the South-East of England.

In Northern Ireland, where we currently have lower wages than the rest of the UK anyway, the minimum wage rise was generally welcomed by political leaders but have we stopped to think about the businesses, most whom are small businesses who will have to pay an increased wage?

In his view from the chair column in the Newsletter today the Chairman of the FSB in Northern Ireland, Wilfred Mitchell puts the case forward arguing that

The minimum wage should be just that – a safety-net level of payment that ensures workers are not exploited, but it should be not set at such a level as to see it destroying jobs and businesses. If the south east of England is experiencing a boom as the economy bounces back – something we should all welcome – we should rely not just on regulation but also on the market itself to play its part in finding the right level of wages for employees.

He went further arguing that we need to be cautious about hurting the recovery

If we lift the safety net higher, without regard for the economic health of the least-well performing regions, we will snuff out much of the tentative growth in those areas and see further centralising pressures driving more economic activity to the south east, further weakening the other regions.

This piece did give me some food for thought today as I watched this debate over the past week-governments can help in raising the minimum wage but at the same time I think about my local shops who are not exactly rolling in cash who will have to pay this.

I would love to see people enjoy higher wages but then again wanting something and making it a reality are two different things.

Maybe there is something I’m missing here?

 

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Comments (66)

  1. notimetoshine (profile) says:

    I would suggest you are missing something…try living on minimum wage, the cost of living crisis isn’t some labour invention it is real and it doesn’t show any sign of abating.

    “we should rely not just on regulation but also on the market itself to play its part in finding the right level of wages for employees”

    The state is subsidising low wages with the working tax credit, because the market has failed to increase wages looks like state intervention is the only thing keeping wages at (a barely liveable) level. I would suggest Mr Mitchell is living in cloud cuckoo land.

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  2. IJP (profile) says:

    The counter to that point (re topping up minimum wage with tax credit) – although it’s well made – is that if you raise the lowest hourly rate paid by a company, inevitably those further up the scale will also demand a pay rise. This would surely causes difficulty to local businesses, used to operating in a low-wage economy.

    That said, there is a serious question to answer about whether our local businesses should be allowed to get away with operating as a low-wage economy, or indeed whether it is in their interests to do so.

    Northern Ireland wages are not, in fact, lower than the rest of the UK’s – except in the private sector. I do wonder – only wonder – whether now is the time to say to local businesses: “Frankly, if you can’t may £7 an hour, you probably shouldn’t be operating anyway – just go bust and we’ll see if you get replaced by a higher value company paying proper money”.

    In short, I don’t know the answer to the question whether NI would be harmed by a £7 minimum wage! On balance, I suspect it wouldn’t be.

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  3. notimetoshine (profile) says:

    @IJP

    “That said, there is a serious question to answer about whether our local businesses should be allowed to get away with operating as a low-wage economy, or indeed whether it is in their interests to do so.”

    Completely agree with you there, but I think that government has alot to answer for in encouraging this as well. One only has to look at the businesses that Invest NI has supported, reams upon reams of call centres, the sweat shops of our age. Having worked in one such office the pay is low conditions terrible and the position insecure.

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  4. Neil (profile) says:

    Gideon’s masterstroke: 6.31 per hour, approx 10k a year, soon to be untaxed. So top those wages up and every penny of that raise will get taxed and he gets a few quid back into his books, all the while being lauded for helping the poorest in society by giving them a below inflation pay increase amounting to around 10 – 15 quid a week (after tax).

    Also, I’m with notimetoshine, we shouldn’t be subsidising very profitable multinationals with benefits so they don’t have to pay people enough to survive. Linking pay at the bottom to pay at the top would be a good idea but the Tories will never go for that as that would mean hurting the wealthy in order to help the working poor.

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  5. FuturePhysicist (profile) says:

    In short, I don’t know the answer to the question whether NI would be harmed by a £7 minimum wage! On balance, I suspect it wouldn’t be.

    The Institute of Fiscal Studies have shown no real correlation between introduction of the minimum wage on employment figures and claimed there was no evidence that a lower minimum wage intensifies employment.

    I suspect the bottom line for employers is not about pay but about getting returns, and too low paid a worker would have detrimental impacts in terms of production if basic standard elements such as dress code, hygiene, health and morale are expensive for the worker to obtain or be provided for.

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  6. FuturePhysicist (profile) says:

    Linking pay at the bottom to pay at the top would be a good idea but the Tories will never go for that as that would mean hurting the wealthy in order to help the working poor.

    I certainly believe the public sector should lead with this one, politicians should be paid proportionate to the average public sector worker or indeed budget. If public sector workers are expected to make efficiencies with lower wages, so should politicians.

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  7. DC (profile) says:

    something we should all welcome – we should rely not just on regulation but also on the market itself to play its part in finding the right level of wages for employees.

    Except a lot if not most of the non skilled work in NI is open to European workers and this helps to keep wages down unfairly imo, it is open because the ability to speak English is not that important as it is not relevant to the work needing carried out or job role, the market in this sector is a European one.

    Whereas the jobs that require a higher standard of English written and spoken are protected from this market due to the bias towards quality English skills, which tend to favour the better educated who can compete and see off other would-be European contenders and job applicants.

    Neoliberal markets cause inequality (think financial markets, CEO bonuses and bank bailouts) and neoliberal labour markets likely do the same in terms of pushing down wages for those in non skilled work, it is fair to say that a cleaner’s job in NI is open to all of the EU to apply for whereas a civil service manager post is technically open likewise but in practice never receives the same level of competition.

    On that basis the case for immigration and EU open labour markets is not self-evident.

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  8. SDLP supporter (profile) says:

    Given that 62% of our local economy is public sector generated, that is ultimately paid from the UK Exchequer, a local administration could put a cap of say £100,000 (maybe less) being paid to anyone who is paid out of the public purse. That goes for politicians, senior civil servants, hospital consultants etc. The money saved should be put into a Social Solidarity Fund.

    I have no problem whatever with the Minimum Wage (MW) being raised, indeed I would support the concept of a Living Wage. I am very sceptical of employers’ bodies saying stuff like “we can’t afford it”. I seem to recall someone like Digby Jones, a rotund well-fed gent then Director General of the CBI, gurning on about the harm raising the MW would do.

    Someone then pointed out that, say he worked 60 hours a week-a generous estimate-he personally was getting about £80 an hour and was whingeing about some poor sod getting £4. Collapse of stout party.

    The dignity of work needs to be recognised. A recent report pointed out that 85 individuals in the world are getting more than the 3.5 billion poorest in the world=that 3.500,000,000. Is there anyone who thinks income inequality, however miniscule in comparison, doesn’t seep down to this miserable little corner of the world.

    As for people like Goldman Sachs, don’t get me started…

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  9. motoguzzi (profile) says:

    NOTIMETOSHINE
    I agree with your main point as anyone living on NMW simply exists – once they pay housing and travel to work costs they may as well be on JSA. I worked for over a decade as a benefits adviser and regularly met people who genuinely wanted to work, quite often with decent qualifications, who saw no real change in moving from JSA to full time work.
    The principle of tax credits was fine but in reality it exacerbates the gap between those in low paid work and those in well paid jobs – when a single person with no dependents earns the minimum wage and is handed a tenner a week in wtc (if their p60 figure from the previous year is low enough they may receive 40-50 quid a week, but, the following year will end up with a tenner a week). Bear in mind that a single person with one dependent earning 40k p.a. will receive 10quid p.w. ctc and around 20quid p.w. child benefit, not to mention maintenance payments being disregarded. Do the ‘powers-that-be actually believe that the difference in income between the person on Nmw and the single parent on 40k is not enough to feed and clothe a child? I saw this scenario many times – the only explanation i can think of is that across the water the person on 40k p.a. is considered a ”middle earner’ while here (with an average salary not much more than half the uk average ) they’re relatively wealthy. Of course none of our politicians could identify this anomaly? I have a friend who works for one of the local supermarkets who, along with his 10guid p.w. wtc, takes home 187quid p.w. and by the time he pays to get to work and pays housing costs he has less than a tenner a week more than he has on jsa (he works from 7am-3pm, 35 hrs p.w and gets out of bed before 5.30)
    Consider this: 15 years ago the ”earnings disregard” for a single person with no dependents was £4 p.w., today it’s £5 p.w.?? and the pampered -unelected (by anyone here at least) millionaires in westminster preach constantly about making work pay.
    The answer’s simple – direct tax credits where they are genuinely needed the most, but, when we are ruled by these chancers in London, trying to curry votes from ”middle-earners” in their own country, there’s not much hope of change. I worked in a SSA up until feb 2013 in Belfast and remember a woman in her late 50′s literally crying when she realised she worked 10 hours in Christmas week (a temporary nmw xmas job) and it cost her £2 because she spent £7 on bus fares over the two days and had everything she earned, minus her £5 ‘disregard’, deducted from the following weeks JSA – it really is perverse. We have the largest number of reps here, with no power over anything important, who have nothing to say on any of these matters. Kinda sums Stormont up?
    I watched Sammy Wilson being interviewed on a Sunday morning political slot some time ago when it was put to him ” Well Mr Wilson, it wasn’t a very good budget for N.I”? His reply? ” Well it was a good budget for the film industry, our fastest growing industry” – not a word about slashing wtc thresholds for people on nmw and an almost simultaneous tax break for millionaires. (To think he has just trousered another £100 P.W. to add to his two – or is it three – salaries)
    The very next week on the same programme up pops Nelson Mccausland and he is being questioned about the obvious negative, disproportionate effect of welfare reform here and he twice mentioned the ”important concessions i have negotiated for people here” (he was talking about the fact that people here will receive their pittance fortnightly, rather than monthly, as proposed for GB) This chancer has been dining out on these ‘important concessions’ for a couple of years now.He actually had the gall to mention the ”important changes to the social fund” (maybe there will be one less form to complete when someone needs to borrow money to buy a pair of shoes for their child – he is an absolute disgrace.
    I used to vote, more fool me, but never again – we have all these so called politicians who simply pay us lip service, refusing to challenge or condemn westminster politicians we dont even elect. Finally, since the ceasefires we have more fuel poverty (one of the highest rates in the world and we are supposed to be part of the fifth richest nation on earth), more child poverty, more peace walls and, as recently reported, N.I average earnings dropped by 0.1% over the past year while Uk average earnings rose by 2.1% over the same period. Along with all this i remember stormont politicians, on the eve of the last elections promising 20,000 jobs over the next couple of years, we lost almost as many jobs (this claim was made when we were deep in recession so they cannot blame a downturn in the economy) but they pocket another £100p.w.
    My view is that stormont is pointless – it has delivered nothing for the general population, only politicians and paramilitaries seem to have benefited from this farce – us tax paying mugs are probably going to have to pay for the UDA to go on holiday again this summer (remember the beano inCardiff last year) and these people still paralse their own communities and are still armed to the teeth.
    God help this place – im genuinely glad i dont have kids as, what sort of a sick society are we living in here.

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  10. Am Ghobsmacht (profile) says:

    Is there any business owners/managers in the house?

    Just wondering as I have no clue about economics and business yet the first thing that pops into my mind is the long list of pubs and business premises for sale.

    There’s a list of reasons why pubs are feeling the pinch but surely this could be a straw that breaks the back of these drink bearing camels and smaller businesses?

    Dunno, just a thought.

    Business owners, the conch is yours….

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  11. DC (profile) says:

    Yeah Am Ghob, away and ask Moy Park the most profitable business in NI about how it is doing on the min wage migrant workers front. People working in the food chain sector paid buttons thanks to an EU-wide labour market keeping wages down.

    I was disappointed that the proposed chicken shit incinerator at Glenavy was knocked back, arguably if that had been Okayed perhaps it could have reduced the cost of energy to businesses and businesses benefiting from that should have been encouraged to lift wages a little as a result of government action on energy?

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  12. mr x (profile) says:

    notimetoshine

    Deutsche Bank are creating 700 well-paying jobs in Dublin

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  13. David Crookes (profile) says:

    Leanne Wood (now leader of PC in Cardiff) did a brilliant investigative job on fat cats in Wales. I wish we had someone like her over here.

    We need a revolution. Why should any public employee get more than six times what the lowest-paid employee gets?

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  14. Am Ghobsmacht (profile) says:

    Well DC

    I was thinking of the wee businessman not the wealthy ones at the top.

    BTW, I think there was a proposal for a cow-shit generator at the old mills in Sion Mills.

    A lot of opposition but I thought it a good idea…

    So again, if there’s any business owner’s here I’d like their insight.

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  15. notimetoshine (profile) says:

    @ Mr X

    but that is Dublin, not Belfast!

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  16. Ruarai (profile) says:

    SDLP Supporter,

    “a local administration could put a cap of say £100,000 (maybe less) being paid to anyone who is paid out of the public purse.”

    Damn straight. We often hear – and they mean it – counter-arguments based on, “you know, I could earn much more in the private sector.”

    My experience of such people and of the private sector is that these guys would often struggle to find executive level employment, period, in the private sector (save for the legal corruption that is revolving-door lobbying).

    But here’s where it’s interesting. If our public servants earning more than $100,000 (and it’s really far, far more when we include pensions, paid sick days, and bundles of perks) really could earn more in the private sector, then, great: the NI private sector desperately needs such people.

    “Forcing” them out be inserting a cap would either:

    a) help create more private sector activity – yay! for all
    b) prove definitively that they were never worth anything like an executive level salary in the first place -cue more savings all-round.

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  17. The Raven (profile) says:

    “We need a revolution. Why should any public employee get more than six times what the lowest-paid employee gets?”

    How many of them are there? Just wondering if there’s enough to generate that revolution. I know that in our local council, the Chief Exec gets paid around five times as much as the binman. Of course, the binman doesn’t have any of the responsibility of the top dog. What would *you* suggest?

    “Business owners, the conch is yours….”

    It doesn’t really count, but I have a small part time business that I am hoping to expand in a couple of years beyond my usual day job. I wouldn’t take on staff. But not because of the minimum wage – because of the regulations on health and safety, the insurance costs, the NICs costs, the eternal threat of litigation if you forget to buy milk for the tea and so forth. Arguments about minimum wages are usually generated by the CBI and FSB. The same organisations that argue against maternity leave increases.

    Frankly I have no problem with public sector pay and pensions. Surely it should be down to the private sector to elevate themselves to a par, rather than lowering the standards of others.

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  18. notimetoshine (profile) says:

    While I agree of course that the public sector is too large and bloated here, big cuts in public sector numbers and budgets won’t help. The private sector simply doesn’t have the capacity to pick up the slack in any sort of immediate/short term period. The only way to rebalance is to encourage private sector growth and allow the public sector to atrophy through attrition, allowing the private sector to slowly pick up more of our GDP.

    Obviously this could achieved without any shrinking of the public sector if we see high sustained economic growth, which in an advanced economy such as ours isn’t at all likely.

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  19. DC (profile) says:

    ‘cow-shit generator’

    Did you mean a cow shit incinerator energy generator?

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  20. looneygas (profile) says:

    Duh, a cow-shit generator is just a cow.

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  21. BluesJazz (profile) black spot says:

    Osborne talked of ‘regional pay’ last spring. And an end to civil service ‘increments’(annual pay rise for sweet fa).
    That would be fair. The minimum wage is good for NI, but crap for London.
    In short, a freeze on minimum wage in NI for 5 years (as well as benefits). And a rise in the productive SE of the mainland.
    Civil Servants in NI are actually paid better than those in London. Not Nurses or Doctors, just photocopiers on £25k plus. (And a superb pension at 50).
    But the NICS is the willy wonka golden wrapper. Money for nothing.

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  22. tmitch57 (profile) says:

    “The Institute of Fiscal Studies have shown no real correlation between introduction of the minimum wage on employment figures and claimed there was no evidence that a lower minimum wage intensifies employment.”

    @Future Physicist,

    I have also seen this claim by economists in America. This just means that the minimum wage reflects the market wage for low-skilled workers. If it exceeds the market wage then companies compensate by finding ways to reduce the number of employees and thus keeping their overall labor costs constant. Talks of raising the minimum wage to $15 per hour in some American states would result in serious rises in unemployment. The main value of the minimum wage is giving legal protection to some very marginal low-skilled workers who have no savings and so would be willing to take work for less than the market rate.

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  23. The Raven (profile) says:

    “Mary had twenty years of reckonable service, including 5 years transferred in from another scheme. Her final pensionable earnings were £36,000. She has bought £1,000 of added pension. Her pension will be: (20/80 x 36,000) + (1,000) = £10,000 a year”

    Am I – as your ordinary common or garden taxpayer – alone in thinking that if every pensioner was on £10k a year – which is taxed of course – that the world would be a better place?

    Would I also be right in thinking that if your average photocopier on £25k has that applied it works out at £6250? Is that a “superb” pension? You’re also presupposing that people stay 20…30 years. The younger generation in now, I am led to believe, average out at about 12 years at most.

    I’m not having a pop – I’m just wondering if the truth and the Daily Mail are two things we’re all getting mixed up… I’ve probably missed stuff about lump sums and State pensions and other things too, but isn’t your average “photocopier”, an Adminstrative Assistant or officer or something on about £16k? Yields a pension of around £4,000 over 20 years? Perhaps someone who knows for sure could comment.

    Anyway…back to the actual topic…

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  24. notimetoshine (profile) says:

    @Bluesjazz

    “In short, a freeze on minimum wage in NI for 5 years…”

    Are you serious?

    The minimum wage is barely enough to live on as is, if you freeze it for five years assuming inflation at 2% you are looking at what 10% maybe more reduction in real wages? And with a freeze in benefits the working tax credit (flawed system though it is) would further reduce that wages spending power.

    The minimum wage is not ‘good for NI’ its crap for NI and the citizens struggling to get by on it. We can’t afford not to raise the minimum wage.

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  25. BluesJazz (profile) black spot says:

    The NICS had a big review 3 years ago, which meant an Admin Assistant (photocopier) moved several grooves up the ladder (plus pension) to £22k, those above moved up ad hoc. (plus free pension).
    Trebles all round ….

    A basic grade in the NICS (yes they still have them years after PC’s meant they had no function) pays more than a registered Nurse.

    Welcome to NICS land. Also most are allowed to move to EO/SO and PO (salary £40k plus) fairly easily.
    No actual job, but moving A4 sheets of paper about “meetings”. Lovely Jubbly

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  26. Am Ghobsmacht (profile) says:

    DC and Looneygas

    OK then, a ‘digestor’ – http://www.bbc.co.uk/news/uk-northern-ireland-22565518

    Gawwwddd……

    Anyway, back to the topic.

    On one hand Tesco, Sainsburys, M&S, Moypark et al could probably take a ‘hit’ like this.

    But the smaller businesses, well, I’m not so sure.

    On a related note, is there any truth in the rumour that McDonalds are exempt from paying minimum wage? (Can’t remember where I heard that, is probably mumbo-jumbo)

    If so, well, should they not be forced into paying min wage and we could see how it affects them?

    If not, then back to square one:
    People need money but they also need jobs, increasing one might lead to the loss of the other? (In my great experience as someone who knows nothing about economics or business and spends too much time on the computer…)

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  27. Harry Flashman (profile) says:

    The problem about talking about a “living wage” is that one is looking at a hugely complex situation (people not having enough money to get by) involving innumerable economic, political, geographic, educational, social, historical, medical and countless other factors and then deciding that the solution is a simple one: force employers to pay more to their staff, tada! problem solved.

    Do we really still look at life and decide that all the problems in the world are caused by greedy capitalists, with their big top hats, cackling maniacally over their ill-gotten gains yelling “Mine! Mine! All mine! Hahahaha!” as they twirl their waxy moustaches?

    Deciding that it is the role of employers to solve a multitude of societal problems not of their making certainly appeals to sixth-form students, NGOs, trade unionists, academics and lefty journalists, you know the sort of people who have never actually run a business, or had to meet a payroll and make the books balance at the end of the week, but it doesn’t actually help in the real world.

    Look, you have to face facts; there are types of jobs that are only worth a certain amount economically and if you artificially hike up the value of this labour you might get a thrill of Mrs Bountiful self-satisfaction but you haven’t actually changed the value of that work. You have merely eased your own conscience by forcing someone else (the employer) to pay for your largesse.

    You cannot look at, say, a father-of-four who is struggling to get by on a minimum wage in a deprived area and say the solution to his problems is that his employer, one of the very few employers in the area, should give him more money. The fact that the man’s employer only has basic, entry-level, unskilled work to offer is not the cause of the worker’s misfortune and nor is the employer to blame for his worker’s situation.

    And yes I did run a business employing people for 12 years. No longer, I wouldn’t go back to that again. Now I have a business that employs nobody, while I work for a large corporation. Trust me anyone who tries to open a small business employing people today is a complete mug, he will be the object of eternal abuse and interference from people who of course have never run a business themselves but know so, so much more about employment and economics than he does and who believe that at heart he is the cause of all the world’s ills.

    Cue the cries of “What about the banks and the fatcats?” none of which bears any relation the the value of entry-level work in deprived areas.

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  28. notimetoshine (profile) says:

    @Harry Flashman

    You are missing the point. No one is saying employers can/should solve our myriad of socio-economic problems, and the living wage isn’t going to solve them but it certainly will go a long way.

    Do you expect people to live on less than what is required to survive and participate in our society?

    People have to earn enough to live, and the fact is the minimum wage is not enough.

    Give your spiel about the complex problems causing poor pay to someone on a minimum wage and see the response you get.

    And don’t forget, we will for the foreseeable future still require a large body of unskilled labour for much of our economy. Tell me how do you propose we fill those positions if their pay continues to lag behind the cost of living?

    Simply put wages have to meet the basic standards of living required in a modern society or the entire economy will be up the swanee.

    I feel sorry for business people who may struggle with this, but what about those for whom unskilled labour is likely to be all they can achieve? Let them starve?

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  29. Harry Flashman (profile) says:

    “Do you expect people to live on less than what is required to survive and participate in our society?”

    No, but their inability to find better-paying work is not the fault of the person offering low-paid employment.

    The business of an employer is to run his business, it is not the role of the employer to change society. If there is a lack of good-paying jobs in an area and too many of the residents of that area are dependent on low-skill work that is not the fault of the employer who offers that work. Telling him to raise his wages to an arbitrary higher level will not change the society one iota, it simply pushes the blame for society’s ills on to a handy scapegoat.

    I know what I am saying here comes across as some sort of crazy, lunatic speak in a society that for generations has been taught to believe that employers are the definition of mean, nasty people who are behind all the problems in society but the fact is you cannot blame a hamburger seller for the fact that he does not require nuclear physicists to man his cookers and counters. It is not the fault of the employer that the only work his employees can find is flipping hamburgers.

    Increasing the minimum wage is merely a nice placebo that makes people who will not have to meet the cost of that solution feel good about themselves.

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  30. derrydave (profile) says:

    As much as it pains me, I do have to agree with Harry in this instance. Small business’s should be not forced to take the hit for the ill’s of wider society. People should be incentivised to start a business and create employment and should not be burdened with the need to provide inflated levels of pay for basic entry-level employment. Peoples expectations in Europe are ridiculously unrealistic – having a bog-standard job should not necessarily put you in a position to be able to afford to bring up 4 kids in a impressively-decorated house with a car, satellite TV, and a foreign holiday every year !

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  31. Am Ghobsmacht (profile) says:

    With regards to giving incentives to encourage people to start businesses, is it true that the rates in Belfast are ridiculous?

    If so, then why are they so high and how much does this compound the stifling of the private sector?

    If I have this right, then after paying rent, rates, bills, insurance, wages, (protection money) tax and wot-not then how much would a wee business in the city centre have to turn over in a single week just to stay open?

    If you had 3 min wage staff working 30 hrs a week each and then this wage hike comes in then that’s over 3k that the owner has to fork out over the course of the year.

    Wee business man can then:

    a/ Take the hit

    b/ Reduce the hours of some of the staff

    c/ Fire one of them

    d/ Pay some one cash in hand (risky?)

    e/ Close with the loss of three jobs. Four if you include the owner.

    This would probably have a knock on effect for suppliers of said business who may already be struggling with the pay increase too.

    So maybe even more people on the dole queue?

    Just a thought, never owned a business so don’t go mental…

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  32. notimetoshine (profile) says:

    @Harry Flashman

    You missed the point of what I am trying to say, the simple fact is that the minimum wage is not longer equal to what it was worth say 5 years ago, 10 years ago due to inflation etc. Therefore the minimum wage (which hasn’t kept pace with the inflation in the economy and our currency) must rise with it.

    This is no panacea to our economic woes but a simple economic fact, if there is inflation, wages must rise to meet that inflation otherwise the employee is being paid less in real terms as the buying power of his/her pound is reduced.

    Our currency isn’t a fixed immutable object, nor is our economy. We have had significant inflation for quite some time now, our pound buys less therefore wages must comply with this otherwise we really are doomed.

    And @Derrydave

    “aving a bog-standard job should not necessarily put you in a position to be able to afford to bring up 4 kids in a impressively-decorated house with a car, satellite TV, and a foreign holiday every year”

    Don’t be so utterly ridiculous, even the proposed raises in minimum wage would not even come close to achieving these things. The minimum wage discussion is about the bare minimum needed to survive and participate in this economy, I think people aren’t being ‘ridiculously unrealistic’ they simply want to be paid the correct price as it were for their labour. And as a pound is not worth what it was obviously wage increases are needed.

    Those awful bog standard workers eh? How dare they presume to be paid adequately for the labour they have provided!

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  33. derrydave (profile) says:

    notimetoshine,

    With all due respect, you are the one who is being so utterly ridiculous ! The minimum wage is way more than ‘the bare minimum needed to survive and participate in this economy’ – I’d suggest you need to get out a bit more and have a look around the world if you think that anything you see in NI represents less than the bare minimum needed to survive ! What we see as poverty in Europe represents a standard of living which in reality is relatively comfortable.

    If you put all your nonsense to one side you will see that I agree that people should be paid adequately for the labour they have provided – I just disagree as to what that level of pay is. Having done many ‘bog-standard’ jobs in my time (pub, factory, security guard, Betterware ffs :-)) at a time when there was no minimum wage, I never struggled to survive in any way – I may not have had enough money for stuff that i wanted, but then again that is one of those things that drive you on to work harder and earn more ! Well, either that or whinge and expect that the world owes you a living !

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  34. derrydave (profile) says:

    ps notimetoshine, go to any working class council estate in NI (not sure if you’ve actually been in one as you sound like a middle-class lecturer who has only read about such places in a book) and what you will find is that the majority of residents are hardworking people, many of whom work in jobs paying minimum wage or not much more. Most people in this category have kids, live in well decorated houses full of modern appliances, with flat-screen TV’s, Satellite Dish, Car, and most people do head off somewhere abroad once a year. Real poverty is extremely rare and usually goes hand in hand with other issues, usually alcohol abuse.

    And before you start trying to spout BS and trying to contradict me, you might pause to consider the fact that I spent all my life in NI living in one of those estates, it’s where I come from, it’s where all my friends and family come from, and unless our estate is a complete abberation and exception then I expect it’s much the same in working class estates all over NI !

    Argue all you want about wanting to increase the minimum wage to keep it in line with inflation, however don’t talk about it equating to the bare minimum needed to suvive as you risk making yourself look a bit of a plonker who knows nothing about the subject you are talking about.

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  35. aquifer (profile) says:

    When some NI businesses would rather mistreat their employees than make real money the minimum wage can be a real bonus, especially for increasing numbers of people working part-time or on zero-hours contracts. And there are lower rates for young people to give them a start.

    Should encourage employers to invest in automation and training also. Will lose a few of the routine jobs but increase output and future-proof the businesses.

    There would be jobs lost, but we need to think about how to grow the private sector anyhow and we cannot easily compete on low labour costs with eastern europe.

    The state should support people becoming self employed (many are self-exploited) by doing the tax and NI calculations for people who can collect money for what they do, using online systems. i.e. By using an online system to bank receipts and deduct expenditures and automatically deduct the tax etc due (and pay the supplementary benefits payable). This would keep people up to date with their tax payments, and could enable the increasing numbers of people on part-time contracts to also start wee businesses that may grow.

    Though expect opposition from middle-class accountants.

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  36. Harry Flashman (profile) says:

    notimetoshine

    I understood your point perfectly the first two times you made it.

    It is your contention that the wages paid for labour agreed between an an employer and an employee in an open market should not actually reflect the monetary value of that labour but should meet a price for such labour as set by government officials because you feel the market price is currently too low.

    I have to tell you government workers trying to fix a market in anything has never proven very successful in the past, it’s not like it hasn’t been tried before you know. Government workers have always believed that they know better than businesspeople, whose livelihood depends on such matters, what price should be charged in the market and, without getting everyone’s bristles up, as Margaret Thatcher said, you can’t buck the market.

    I work alongside a colleague who is a young single girl in her twenties who lives in cheap rented accommodation in the student district, her biggest costs are going out with her mates for a drink on a Friday night. I on the other hand have a wife and kids to support, a house to look after, a car to keep on the road, health insurance and school fees to meet, and a healthy appetite for the finer things in life including food and booze, sometimes it can be hard keeping up with the bills.

    My colleague and I are paid the same salary by our employer because we do the same job. And rightly so, however, by your reasoning I should demand my employer pay me more because I need the money more than my colleague. I disagree, my family circumstances are my own concern and are not the fault of my employer.

    Both my employer and I agreed before I took the job what the remuneration would be, if I find it insufficient to meet my needs the onus is on me to negotiate a rise or find better work. I do not expect the government to intervene to order my employer to pay me more because I’m not earning enough to meet my domestic expenses. They are my problems, not my employer’s.

    Just to clear up any doubt, I loathe abusive employees, I am appalled by “zero-hour” contracts, I fully support the right of a worker to be as safe as humanly possible in his or her workplace, I support the idea of workers banding together in a union to collectively negotiate the value of their labour (provided of course that workers have the choice of not joining a union and negotiating individually if they see fit) and abhor slavery or indentured labour. Does that about cover it?

    Let the market decide the going rate, a worker in London should earn more than one in Newry because the Londoner’s labour is more expensive and scarce, and if the government stops trying to manipulate the market this is what will occur naturally.

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  37. Harry Flashman (profile) says:

    “I loathe abusive employers” obviously.

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  38. BluesJazz (profile) black spot says:

    http://www.theguardian.com/commentisfree/2014/jan/21/truth-is-we-are-all-living-on-benefits-street

    Money for nothing.

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  39. Doug (profile) says:

    BluesJazz (profile) says: 22 January 2014 at 1:10 am The NICS had a big review 3 years ago, which meant an Admin Assistant (photocopier) moved several grooves up the ladder (plus pension) to £22k, those above moved up ad hoc. (plus free pension).
    Trebles all round ….

    ———————————————–

    Actually an A.A. is on £16,300 – £17,620 dependant on where in their salary band they lie. Still more than I earn, but nowhere near the 22k you’ve mentioned above.

    http://www.dfpni.gov.uk/2012-13_and_2013-14_proposed_pay_scales_2.pdf

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  40. quality (profile) says:

    Businesses don’t want to pay their employees more, shock horror. Presumably they also want to pay less tax.

    Let’s raise the minimum wage, christ knows it’s needed. It’s then up to businesses, particularly local ones rather than multinationals, to ensure their offer is good enough for the money to be reinvested locally. Which in turn creates jobs.

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  41. quality (profile) says:

    Maybe businesses and trade organisations could lobby the Executive to lower rates as a trade off, rather than bleating about paying workers more.

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  42. David McCann (profile) says:

    Harry Flashman hits the nail on the head.

    I used to ask my parents who had buggar all academic qualifications how they made a good living and they always told me about somebody who gave them an opportunity to work, upskill, so that they could move on to a better job later. Small businesses are the people who actually take the punt on people like this and give them opportunities.

    I think when we think about employers we think Tesco, banks and huge multi nationals but remember most people in the UK are employed by small businesses not big companies. The thing about the minimum wage is you actually need to be in a job to get it.

    I think there is a debate to be had about perhaps lowering the rate of Nat insurance that employers pay to facilitate a higher rate or as quality says lowering rates.

    Also, once upon a time Britain had wage controls and they were a disaster-similar policies were pursued in New Zealand, Canada and Australia and all were abolished and have never been seen again.

    The trick is to train people in the right sectors early enought to lure these higher paid jobs-that is what Australia has done and has enjoyed 22 years of unbroken growth and while middle class incomes have stagnated here they have risen by over 20% in Australia. That’s how you get growth and real opportunities for people and it’s not all down to the mining boom.

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  43. quality (profile) says:

    David McCann

    “The thing about the minimum wage is you actually need to be in a job to get it.”

    There’s also a point that if a business who employs, say, 10 people at the minimum wage can’t afford to raise their salary by 69p/hour they aren’t a viable business. Offsetting it with NI contributions or rate reductions may sweeten the pill.

    Businesses will act (rationally) to oppose such increases. The Conservatives opposed it at the time on the basis it would add to business costs and lead to job losses. To my knowledge, that didn’t happen. A Government should base its decision on the wider benefit. In this case, it’s clear.

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  44. Harry Flashman (profile) says:

    “There’s also a point that if a business who employs, say, 10 people at the minimum wage can’t afford to raise their salary by 69p/hour they aren’t a viable business.”

    Says you that probably never had to balance the books in a business in your life.

    Fine, raise the wage 69p an hour and close those unviable businesses down. Next year raise it by 57p and hour and shut down some more businesses. The year after raise it 48p and hour and some more businesses close.

    At the same time of course you will be adding more and more employment regulations, increasing taxes and rates (while allowing multinationals evade similar taxes and rates), cracking down on car parking and garbage disposal, making more VAT audits, and more and more “unviable” businesses go to the wall. At the same time as bailing out those banks who certainly don’t employ too many minimum wage-earners.

    Of course more and more public sector employees get taken on to make sure those evil, unscrupulous businessmen aren’t exploiting their staff or using the wrong lightbulbs or have installed the correct disability ramps or have the correct size of signs.

    Or you could tell the government to back off for a wee while and let small businesses get a breather and try to keep their heads above water.

    Nah, stick the boot in to the employers, the filthy capitalist scum.

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  45. cynic2 (profile) says:

    The rise proposed is around 10% so with holiday pay etc that will gross up to a labour cost rise of 12%. It all then depends on what % of the price you pay for something is the labour element.

    If its something like a takeaway meal you are looking at a price rise of say 4% on which the Government will add another 20p vat in the pound so say almost a 5%. If its something where the staff input cost is much higher eg security or cleaning or some retail you could be looking at a price rise of 8% to 10%

    So the bottom line is do you mind paying an extra £1 for that curry or £2 on your taxi fare then that’s fine

    Of course the interesting little side effect is that as prices rise so too does the chancellors take. From a 10% rise in the minimum wage he will pick up a 2% rise in income tax receipts + 1.38% on National insurance + say 2% more on VAT = 5.38% of the wage bill in the low pay sector. This is on top of whatever he saves on lower benefit costs.

    Nice little earner George

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  46. FuturePhysicist (profile) says:

    Who am I to believe the Institute of Fiscal Studies or a PhD historian?

    Just because an employer could pay someone £5 an hour, doesn’t mean they would employ 2 for £10 over 1 for £7, indeed having the ability to employ people for £3.50 does not mean an incentive to employ even 2 for £7. But the theory says oh generous sensible employers are going to fork out a lower share of money with the goal of employing more, and desperate potential employees could solve their problems by lowering their demands, way down at the bottom rate.

    The problem is, is that there is no reality in the job market according to the Institute of Fiscal Studies

    A minimum wage had no negative impact on employment, evidence trumps theory. How many surveys did you carry out David or are you resorting to theories I.e. guesswork.

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  47. JH (profile) says:

    Hmm, it’s a tough problem and there are no absolutes IMO.

    E.g. Someone brought up the high pay public sector workers get relative to the large portion of the private sector that depends on minimum wage.

    On the face of it the solution would appear to be to cap public sector wages and allow others to catch up. The problem is that per capita spend would go down disproportionately and hit a lot of those employers; shops, bars, restaurants etc, effectively reducing the capital available for employment. On the other hand it’s those higher wages that are keeping prices relatively stable here, buoying the cost of living and thus exacerbating the divide.

    I don’t know the answer but I know it’s more complicated than just a gut feeling. Throw into the mix that a lot of those on minimum wage are on zero-hour or so-called ‘matrix’ contracts and it muddies the waters further. These people probably won’t be any better off as they’ll just lose an hour here or there to make up the difference in a MW increase.

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  48. quality (profile) says:

    Harry Flashman

    I’m all for letting (small to medium) businesses breathe – cut regulation where applicable, offset it by lower rates/taxes/NI contributions for small businesses.

    However, given the state picks up the bill for low wages in a variety of guises, the state should intervene to ensure people are paid appropriately. Those wages aren’t spent in a vacuum, they’re re-invested.

    The argument that businesses would go to the wall was used to oppose the minimum wage in 1999. Businesses will (rationally) oppose increases in their overheads (see Tesco et all suggesting placing a levy on large retailers would mean less jobs, less investment etc). Self-interest is an essential part of business That doesn’t mean that such a policy isn’t worth exploring.

    To drive down the benefits bill, you have to increase wages and lower rents (sanctions and cuts aren’t sustainable longer term). To allow smaller businesses to pay more wages, they need to be incentivised (with reductions in overheads elsewhere). Less tax/NI contributions from smaller businesses are in turn covered by a smaller benefits bill and more in take in terms of VAT etc due to a working population will more disposable cash.

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  49. David McCann (profile) says:

    FP-It’s the Federation of Small Businesses who represent over 7k small businesses in NI.

    My evidence comes from my parents running small businesses-who in their early years struggled to make ends meet-remember NI has an economy that has 60% of output from the public sector-there is not a big pie for smaller enterprises to compete.

    Why in a recession when we have nearly 25% youth unemployment would you make it dearer for hire people? How does that make any sense at all?

    I also laugh the same people who lambast corporations are the same people who laud policies that put smaller ones out of business.

    I have no problem with raising the minimum wage but if you are going to do it-small businesses in NI particularly need more support to offset those costs.

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  50. quality (profile) says:

    “there is not a big pie for smaller enterprises to compete.”

    Of course there is. Procurement. Getting on the NICS gravy train should be priority number one for a lot of small to medium businesses.

    Obviously opening up tendering can always be improved, but they should absolutely be seeking to access that ‘pie’.

    “Why in a recession when we have nearly 25% youth unemployment would you make it dearer for hire people?”

    You don’t just make it dearer for people to hire people. You offset it (in a different way to just paying tax credits and housing benefit). Putting more money in people’s pockets is never a bad thing.

    The minimum wage is just that, the minimum. It has to stay relevant to other costs or else it is essentially pointless.

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  51. quality (profile) says:

    Re: offsetting I believe the GB Labour party have proposed something of the like for living wage employers. Now, they’re hardly intellectual giants but it’s certainly worth exploring.

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  52. looneygas (profile) says:

    Capitalism produces lots of stuff. It’s great at generating wealth. It’s in the area of dividing the spoils which capitalism fails. You can con people off with the “entry-level” bullshit for so long, but when people realize that these middle and upper tier jobs are far fewer in number than those that would seek them, they will start to picket outside fast-food joints like they’re doing in the U.S. now.
    I worked mostly at low-skill/low wage/high back pain jobs. Most people I worked with were sour on unions in large part because they’re stupid uneducated white folks with a frontierist attitude and little capacity for trust or ability to act as a group. (I grew up in a smallish Wonder-bread town.)
    In the States, the prison system is over capacity, so they can’t just lock up all people of colour on drug charges.
    It’s people of colour who are willing and eager to join service sector unions and demand higher wages because they have more capacity to bond with their fellow workers than the fearful, well-behaved, thank-you-sir-may-I-have-another, individualistic white folks I worked with.
    They also are less easily baffled by bullshit arguments about entry-level work and knowing your place and waiting your turn and boo-hoo poor small employers trying to get by.
    Their way of looking at it is, I’m doing a job that needs doing. I have to pay rent, eat, etc. I can’t do that on what I’m paid. Yeah, some of us might move on to something bigger and better, but most of us won’t. Some of us will take out loans to take a post-secondary course and up back here deeper in debt. Maybe I haven’t read Brave New World, but we Gammas, Deltas and Epsilons do not exist so that the Alphas and Betas can enjoy their electro-magneto golf clubs, feelies and gyro-copters.
    Sooner or later, the rabble will be roused. People will realize that life in a capitalist system is a crap shoot and the odds suck. They will then start flipping tables like an angry Jew outside a desecrated temple.
    Metaphor Mixmaster 3000 on sale now. Act fast. Supplies are running out.

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  53. cynic2 (profile) says:

    When we level the Minimum Wage up can we level the civil service wage down in real terms. Currently for many jobs civil servants get 40% more pay plus pension and benefits

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  54. Neil (profile) says:

    The pension’s what gets me Cynic. I pay in about 10% with the gratefully received contribution from my employer. I do this for 40 years and can expect about a fifth of a public sector pension.

    Spare a thought for the lowest of the low (employment wise) who get to contribute a whack of tax every month to pay for a pension that’s not their own, no, when they retire they’ll have no pension having spent a lifetime paying for someone else’s.

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  55. Billy Pilgrim (profile) says:

    Am Gobschmacht

    ‘There’s a list of reasons why pubs are feeling the pinch but surely this could be a straw that breaks the back…’

    One of the biggest reasons pubs are struggling is because there are so many working class people who can’t really afford to drink in pubs any more, because they are paid so little

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  56. Billy Pilgrim (profile) says:

    Harry

    ‘Do we really still look at life and decide that all the problems in the world are caused by greedy capitalists, with their big top hats, cackling maniacally over their ill-gotten gains yelling “Mine! Mine! All mine! Hahahaha!” as they twirl their waxy moustaches?’

    No, the problem is governments that refuse to use the powers of the state to protect wealth creators (ie workers) and instead collude with the parasites you so accurately describe above.

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  57. Billy Pilgrim (profile) says:

    ‘…I have to tell you government workers trying to fix a market in anything has never proven very successful in the past…’

    Ideological bunkum, totally divorced from the reality of how every successful economy in history has worked.

    I presume you typed that post on a computer? Well the only reason you have a computer is because of governments fixing markets – indeed, through lavishly wasteful procurement of goods (ie early computers) for which there was no market.

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  58. Billy Pilgrim (profile) says:

    Incidentally, people shouldn’t make the mistake of regarding business and capitalism as synonymous. Most small business owners I know (shop owners, tradesmen, service providers – maybe even Harry?) aren’t capitalists, even if many of them think they are.

    ‘Capitalism’ is the name of a very particular economic system, and your local corner shop aint an example of it. Goldman Sachs is.

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  59. The Raven (profile) says:

    “Welcome to NICS land. Also most are allowed to move to EO/SO and PO (salary £40k plus) fairly easily. No actual job, but moving A4 sheets of paper about “meetings”. Lovely Jubbly”

    Really, I know this sort of thing isn’t on in Keyboard Warrior land, but I’m gonna have to ask for some empirical evidence…like something more than stories and “I once knew a man”.

    Is there not around 35,000 civil servants in NI? To absolutely contradict myself against what I wrote above – I do know quite a few, and I’m damned if I know many of them that moved from the basic grade to the grades you’ve mentioned, “fairly easily”, if at all…

    Neil – if your pension after 40 years is a fifth of £6250….can I suggest seeking some prudent financial advice?

    Also in general – can I even suggest that more than quite a few of us either take our jealous-heads off, put more towards the pension, (I do), or just simply wait for an opening in the Civil Service? My understanding from some of the comments here is that it is “fairly easy” to get to forty grand in a short period of time from being a photocopier…

    :-/

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  60. Coll Ciotach (profile) says:

    I run a small firm.

    There is a dilemma here. It is who pays/

    There are people with very few skills who can, to put it bluntly, be replaced with little effort. Therefore they will attract less wages than people who have greater skillsets

    I do not subscribe to the Manchesterian liberalism that many subscribe to, Dickens dealt with that cruel philosophy in the last century, that the market decides. It will and its decision will not be acceptable as it does too much damage to society.

    People need to live, and live does not mean survive. Live means have enough to feed, clothe and shelter your family as well as the release of being able to afford entertainment and diversion from everyday life. You need to be able to participate in society. This requires money.

    So do you force the employer to pay or do you subsidise his low wage business by handouts?

    As a business man I do not want to be penalised for the failures of the capitalist system. Why should I be paying over the odds? On the other hand if society, meaning govt, pay why are they subsidising my business?

    There is the dilemma.

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  61. looneygas (profile) says:

    CC,

    As you seem to be a small businessman with sense of decency and concern for others, I have sympathy for you.
    I have no sympathy for the greedy bastards and their PR jackasses(Kevin O’Leary in this country, I’m sure you have your own) who perpetuate a grossly unequal system in which the poor/weak become ever weaker and ever less capable of functioning on a higher than menial level.
    Having worked in low-wage factories and warehouses, some of them quite large, employing as many as 2000 people on a long-term basis, I’ve seen what it’s like for people to try to raise kids with only enough money for the cheapest shoes and clothing, no money for sports equipment or registration fees to play organized sports, no money for trips or outings, never being able to eat in a restaurant other than a fast-food joint. Not great for the self esteem of the kids or their parents.
    The people I worked with consoled themselves with the fact that “ay least I’m not on welfare.” Ahh, the wonders of not being on the VERY bottom. Anything is endurable as long as someone else is worse off.
    The invisible hand is great for ensuring that low-cost products will always be available. Unfortunately, the cost of labour is also driven relentlessly downward by the invisible hand. Oddly, the invisible hand seems, for some unknown reason, to drive executive compensation upwards. Strange World.
    As others have said, gov’t. wage and price controls don’t work. If gov’t. give low earners an extra nickel, employers figure that’s one less nickel they need cough up(zero sum).
    There was a time when owners of large businesses felt some civic responsibility and had some sense of fairness regarding wages. That was before the days of people like Carl Icahn who gloriously decided that he had a duty to shareholders to take over companies and reduce their labour costs, thereby increasing value to shareholders.
    These days when Warren Buffet says he wants to pay higher taxes because, after all, in the 1950′s taxes were much higher on the rich and everything was fine and dandy, he’s ignored.
    Anyway, here’s hoping that the proles will become conscious/rebel/cease happening. And/or that the greedy -top hat-wearing-mustache-twisters will grow a heart.

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  62. Coll Ciotach (profile) says:

    just another thought, you aske whether this would hurt NI?

    If NI cannot afford to give people a decent standard of life you need to ask why and what should be done. The history of the region has been one of continuous decline since partition. From going from being the industrial and economic capital of Ireland, being on a par with Dublin in terms of population and so on, it has seen steady decline as its economy was wed to the priorities of the south east of England. This dependency has increased over the years. I would liken it to the addict who started of in self deceiving control of his habit until he is now out of control, in the gutter and shooting every subvention into his economic vein just to feel normal but when the effect goes the reality sadly suffers.

    That was the price of the union.

    Now you ask if a low wage economy such as the north would be hurt if all control over low wages is removed?

    Maybe it would kill the junkie, maybe it would cure him of his addiction, but the cold turkey being applied by the govt, (centralisation of the CS, see Motor Tax and Taxi bureaucracies heading to Cardiff), is not going to help either.

    What do you think?
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  63. IJP (profile) says:

    David

    It’s a really tricky one that, though.

    I run a small business. But I wouldn’t dream of paying anyone under £7/hour – indeed, I wouldn’t dream of paying anyone under £10/hour. This isn’t out of some great social conscience; it’s simply because I want good, motivated people working with me!

    However yes, as a consequence of that I don’t and haven’t had as many people working with me.

    Yet I suspect that route – fewer people employed but earning more – is the way we’re going to have to go. Quite what that means is anyone’s guess.

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  64. Charles_Gould (profile) says:

    “Yet I suspect that route – fewer people employed but earning more – is the way we’re going to have to go. Quite what that means is anyone’s guess.”

    Surely it does not require guess work.

    One curious thing is volunteering. Was wandering around the V&A and asked an attendant to show me the way to King Henry VII’s desk. She pointed me the way. I saw her badge: VOLUNTEER.

    So, some people are on £0 per hour. Because they like the activity.

    This was a great thing in the Olympics too.

    Go figure.

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  65. FuturePhysicist (profile) says:

    FP-It’s the Federation of Small Businesses who represent over 7k small businesses in NI.

    My evidence comes from my parents running small businesses-who in their early years struggled to make ends meet-remember NI has an economy that has 60% of output from the public sector-there is not a big pie for smaller enterprises to compete.

    Why in a recession when we have nearly 25% youth unemployment would you make it dearer for hire people? How does that make any sense at all?

    I also laugh the same people who lambast corporations are the same people who laud policies that put smaller ones out of business.

    I have no problem with raising the minimum wage but if you are going to do it-small businesses in NI particularly need more support to offset those costs.

    Small businesses are not tied to minimum wage legislation if they are below a certain size, I’ve worked in a few myself. Have you? Family businesses are not tied by many regulations either, having worked in my own family’s business this is true. This 10 people business thing is being used by companies that employ 1000.

    Secondly, many of the problems facing some small businesses do come from a bad business model, as do with some corporates. There’s been complaints about skills shortages by businesses who really have no clue what so ever what these skills are.

    There’s a school of thought that tax cuts to reduce education investment and wage cuts to cut personal investment does not practically provide the investment to let companies grow to their business owner’s fantastic expectations.

    If The Federations of Small Businesses have businesses that are being pounded by the markets having, wishing they had a £4 an hour workforce that doesn’t get sick, and is willing to plough a lot of their own human capital in terms of skills, wills and extra thrills for next to nothing isn’t going cut the mustard.

    Look at the pathetic Research and Development tax credit uptake, for example. Britian and Ireland both have culturally conservative retail cultures and the two came bottom of a list in terms of commercial University output, and yet Northern Ireland is by far the worst area between these islands for this disease,

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  66. freemarketcapitalist (profile) says:

    A higher minimum wage costs jobs and puts existing jobs in jeopardy especially in a time of economic difficulty. It also forces many businesses to increase the cost of goods and services that they provide to customers therefore increasing the cost of living. I come from the South and the introduction of the minimum wage in 2000 resulted in the cost of living increasing quite substantially from 2000 onwards which eroded economic competitiveness. Cameron’s proposals to increase the minimum wage to £7 per hour by the 2015 election is a populist vote buying stunt, It also shows that under Cameron the Tories have become a centre left social democratic and socially liberal party far removed from Thatcher’s beliefs in free market economics.

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