Minimum Wage

We had an interesting after dinner conversation last night. Yet another new Super Walmart is moving into town and we were discussing if they were good or bad for the local economy. The majority of the room was in favor of Super Walmart saying it would bring cheap goods and lots of jobs to the area. While I agree it will bring cheap goods and lots of jobs to the area, I believe it will replace small businesses and higher paying jobs with minimum wage jobs.

Minimum wage jobs are evil. Not only can you not live well off a minimum wage job, they rarely come with paid time off, sick time off or benefits. So any accident or health problem kills you, financially speaking.

Let’s just play with some numbers here. Minimum wage is $5.15/hr. Take that for 40 hours a week, 52 weeks a year (who needs vacation?). Subtract 10% federal tax and divide by 12 months. You come up with $803/month.

I challenge you to come up with a budget that allows you to live off $803/month without any help from others. Average rent for a one bedroom apartment in my hometown is $550/month! Even with a roommate, you’d have a hard time affording a car, gas, food, utility bills, phone bill, etc. And I’m assuming you don’t have any kids, medical bills or credit card debt.

And yet I was told last night that I should be glad Super Walmart only paid minimum wage because that’s how I get cheap groceries and goods. Personally, I can afford to pay a few dollars more on my weekly grocery bill if it means the kids across town get to eat well too.

[6/11/04 Modified to take out social security as earnings under $11,640 are exempt.]