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What the minimum wage means at work

Waitresses prepare to deliver breakfasts to customers in Emeryville, Calif. Upworthy has tried to shine a spotlight on minimum wage jobs and so-called 'workonomics'.

President Obama was barely into his post-State of the Union road trip today when House Speaker John Boehner poured cold water all over one of the key economic items in the speech. The president proposed raising the minimum wage to $9 an hour. Boehner said it would hurt small business and kill jobs.

Economists disagree about whether raising the minimum wage helps by putting more money in the hands of low-wage workers or hurts by encouraging employers to eliminate jobs. A raise from to $9 an hour, from $7.25 an hour, would add about $3,600 to a minimum wage earner's annual income -- and a business's payroll.

Many minimum-wage workers are employed in the restaurant business, although their wages are often supplemented by tips. At the Marmalade Café in El Segundo, Calif., employees like 32-year-old food runner Alejandro Serbin earn California's $8 minimum wage, plus about $35 a day in shared tips.

Serbin, an immigrant from Mexico City, says a dollar raise would help. "It's so much different for me. Because I have a family I have to support. The rent is high. I have to pay bills, insurance."

Serbin and his wife, who works as a cook, have a 3-year-old and pay about $1,000 a month in rent, not unusual for Los Angeles. He's hunting for a second job and says most of the minimum-wage workers he knows have two or even three jobs.

Selwyn Yosslowitz is one of the Marmalade Café's founders. The restaurant employs about 600 people in nine locations in southern California. Yosslowitz says a dollar increase in the federal minimum wage would likely force him to raise prices or cut labor costs.

"It wouldn't be layoffs," Yosslowitz says. "But maybe you make the hours more efficient. There's lots of people who come in at 9 o'clock right now. I would make sure they come in at 9:30 and cut off half an hour across the board to be able to afford the increase."

Serbin and a co-worker from Peru say their hours are sometimes cut when business is really slow and management sends them home early.

If Congress raises the minimum wage, that ultimately may help boost all the wages at a place like the Marmalade Café, including the better-paid cooks in the kitchen.

About the author

Sarah Gardner is a reporter on the Marketplace sustainability desk covering sustainability news spots and features.
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If raising the minimum wage to $9 is a good idea, why not $10, or $25? At $25 an hour you make the poor earn $52,000 a year working full time. No more poverty!!! Just think of the savings on welfare hand outs!

or would it mean less working hours and less jobs? And why stop at $25, why not $100 an hour!

Isn't the minimum wage a major driver of inflation?

Sarah Gardner's story about the minimum wage left out one huge factor affecting workers and taxpayers and that is the fact that labor and capital are interchangable. If you make labor artificially expensive, and at the same time the cost financing labor saving capital equipment artificially cheap, you make it more and more lucrative to automate all kinds of low skill jobs. So we have a time when there are lots of people with no jobs, we're giving business the price signals to automate and eliminate jobs. There is no such thing as a "living wage", the wage you earn is the value that customers place on that skill set. You don't have a right to work any job, no matter what it is, and expect to support a family. A lot of these low skill jobs were meant to be temprary jobs for teenagers while they were learning more valuable skill. Now you have people fleeing poverty in their home countries expecting to support a family doing a teenagers job.

The people supporting their families "doing a teenager's job" are not just "people fleeing poverty in their home countries." In fact more of our college-educated citizen workforce is underemployed since the most recent recession (one reason why unemployment numbers are inaccurate). Immigration is actually down, due either to a crackdown on undocumented immigrants, tighter border controls, and/or a tighter U.S. economy with fewer available jobs, so now you see more of these types of jobs being done by older and younger workers who are full U.S. citizens, and yes, many of them still have families to support right here in the U.S. I am one of these people. A living wage is the minimum hourly wage needed to support a full-time worker in obtaining housing at market rates, as well as buying food and utilities without public assistance.

Sarah Gardner's story about the minimum wage left out one huge factor affecting workers and taxpayers. That is the fact that full time workers, like the food runner who is supporting his family, are poor enough on the current minimum wage to qualify for government assistance programs like food stamps and Medicaid. Why don't you tell the whole story and investigate how much taxpayer money would be saved if we actually legislated a "living wage." By allowing employers to pay a wage that keeps people on public assistance, we are in effect subsidizing small business.

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