Because people are leaving jobs and industries for better wages. You have people abandoning “essential” jobs for non-essential ones because they are never going to see a pay increase due to employers never giving raises and never seeing the government demand an increase.
Very few places pay the federal minimum wage, so we have sort of a de facto one of $12 an hour or higher in many states.
That wasn’t a big problem when people jumped ship from restaurants and retail to call centers. It meant small, redundant businesses might close.
But then you have big employers like Amazon paying $15 an hour — twice the federal minimum wage and a giant competitor for a majority of workers in the supply chain. You have people leaving trucking customer service jobs to work for Amazon customer service. You have delivery drivers leaving trucking to drive a forklift in the warehouse.
There is an enormous migration occurring in the workforce from lower paying jobs to higher ones. Employers who can afford to pay more get the workers.
Many times, those jobs aren’t essential. A gradual increase in federal minimum wage would have closed the gap and eased businesses into higher labor costs.
But when a company has 100 employees making $12 an hour and has to pay $15 just to retain those they have, that’s an increase of in payroll of $48,000 a month or $576,000 a year. If they pay $10 an hour, that’s a $960,000 jump.
It is a cash flow issue when delayed goods are affecting their earnings. It’s like if you have to absorb a $5 a week expenditure for a year versus a one time outlay if $2400 when you’re unemployed.
People would be less likely to job hop to places like Amazon (with a horrible reputation for treating workers) if they could get the same pay in their old job. But because the economy is fucked up, it’s easier to not fill the openings.
And that doesn’t matter when it’s one employer but when dozens do that in trucking, it fucks up the supply chain.
By raising the minimum wage, you slow or reverse the concentration of wealth at the top. That means lower jobs become more valuable. It also sort of “shock proofs” the labor market.
