Big Business: Raise the Minimum Wage and Computers Will Replace You at Work

A new advertisement backed by business says raising the minimum wage will accelerate the replacement of humans with technology

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The minimum wage wars are heating up. Last week the nonpartisan Congressional Budget Office published a report on the economic costs and benefits of raising the minimum wage. The good news: Raising the minimum wage from $7.25 to $10.10 by the end of 2016, as the President has proposed, could lift 900,000 families out of poverty. The bad: It could eliminate an estimated 500,000 jobs.

People on both sides of the debate touted the findings in the report that bolstered their arguments while dismissing the evidence that contradicted their view. Exhibit A is a television commercial produced by the Employment Policies Institute, a research group funded by industry, airing this week nationally on Fox News and in D.C. on cable channels including CNBC, CNN, and MSNBC.

Since the minimum wage debate began decades ago, economists, business owners, activists, and public policy makers have been arguing about the merits of the minimum wage as a tool for helping the poor. On the one hand, there’s the obvious benefits of higher wages. On the other is the fact that employers will cut jobs to offset rising labor costs. In this year’s debate, the minimum-wage opponents have another weapon in their arsenal: The rise of new technology that they say will replace humans more quickly if the government gives employees a raise.

In the advertisement, actors playing a checkout clerk at a grocery store and a waiter at a restaurant slowly fade until they disappear, while customers use a self checkout lane to buy their groceries and a touchscreen tablet to order their food. In the background, a voice intones: “President Obama wants to raise the minimum wage by nearly 40% and that may sound like a good idea. But if customers won’t pay for it, it forces employers to install technology that takes the place of entry-level jobs. Every time you use a self checkout lane or even a touch screen ordering system, it’s a task that used to be part of someone’s job description. When you raise the minimum wage a new government report confirms that up to one million jobs will disappear.”

There is no way to predict with certainty how new technology will impact service jobs in the coming years with or without a raise in the minimum wage. But as this debate unfolds, you can be sure business will try to use that uncertainty to their advantage.

14 comments
ToniJacks
ToniJacks

Here's a news flash.... Computers have already replaced us... Now let's focus on a utopian society where robots and computers do all the work so I can quit my cra$$y job!!!!

BivianPerez
BivianPerez

If consumers refuse to use self-checkout machines, big businesses cannot afford to keep them. WE CAN MAKE A DIFFERENCE RIGHT NOW. INSIST ON WAITING IN LINE TO BE ASSISTED BY A CASHIER! I DO IT ALL THE TIME; IT REALLY IS NO BIG DEAL. IF WE CONTINUE TO USE SELF-SERVICE MACHINES, WE WILL BE THE ONES PUTTING PEOPLE OUT OF WORK. It's not just self-checkout machines, ATMs are also taking jobs away. Go to a bank and have a person take care of your transactions. APPs are also replacing human services. As consumers we can MAKE a difference, without us businesses WOULD NOT survive. Be strong, be determined, don't give into the machines.

fkkroundabout
fkkroundabout

yep, raise it, welcome to the future. machines have replaced humans throughout history - agriculture for instance - and i think whether it is wanted or not this will only continue. hopefully it will turn out positively, so that the only careers to be left available are ones that encourage, or even force people, to pursue their genuine interests, skills, and passions.

plus, perhaps if robots can run services at a lower cost, this saving will be passed down to all

i must add i've the bias of a technocrat, who always opts for the self service machine

mjkittredge
mjkittredge

"In the advertisement, actors playing a checkout clerk at a grocery store and a waiter at a restaurant slowly fade until they disappear, while customers use a self checkout lane to buy their groceries"

People don't like to use these - most  supermarkets/retailers have several self checkout lanes, and half the time I go grocery shopping nobody is using them. The problem - if you do ANYTHING wrong, or there is a glitch or error, or problem item, you have to sit there and wait for a manager to come over and enter in a code, which can be a while. It ends up taking longer than if you had simply gone the traditional route with a cashier. And it's much more frustrating. People prefer interacting with other people who can get things done faster and solve problems faster, to a dumb machine that still relies on human workers to operate. I consider using them, then remember all my bad experiences with their user unfriendly system and skip it.


The whole "Machines replacing workers" thing has been gradually happening for decades, part of a one two punch hammering American workers along with outsourcing & Bain Capital style takeovers and mass firings/layoffs for profit. The funding for the group that made this commercial comes from unethical CEOs who pay themselves increasingly enormous amounts and also fight to keep their workers pay as low as possible. They break laws regularly, ignore regulations, (getting slap on the wrist fines for these) and score sweetheart deals with lawmakers to pay far less than the corporate tax they always complain about, while some (thousands) also off-shoring their HQ in the Cayman Islands to avoid paying taxes. This costs America hundreds of billions a year. They've kept wages for the middle class stagnant for the past 30 years despite great increases in profit and productivity.


My point in saying all that is to demonstrate that corps do not have the American people or the workers best interests at heart. They care about one thing, and one thing only: Profit. They only follow the rules and laws if they are forced to. If we elect repubs who rewrite the laws to go easy on corps, then stack the judge appointments with more conservatives, and give the corps even more power, we will be at their mercy and suffer. We are peasants and bugs to them, they only pretend to care about us for the money they can take from us.


I think corps that profit billions and pay CEOs 20+ million a year can afford to pay their lowest tier workers 10 an hour. Small businesses should get a subsidy (best case) or exemption (worst case). 


There aren't enough good paying jobs for people to move up into. No one who works should be in poverty. There should be no such thing as the working poor - work should be a ticket out of poverty.

ChubbySurvivalist
ChubbySurvivalist

This is not about some scapegoat like "big business" being evil, it's simple math. It might be somewhat expensive to install self-checkout stations at a store. But if employees suddenly become more expensive than the machines, the company doesn't have much of a choice. It's the same reason so many jobs have moved to India over the years -real estate costs, regulations, and mandatory employment benefits make it cheaper to hire somebody 8,000 miles away than somebody in the same city.


You do the same thing every day. When beef prices go up, you might buy more chicken or turkey. Living in Nebraska, I don't make as much guacamole as my Texas relatives, where avocados are cheap and plentiful. I might put a little sour cream on my tacos instead.


Most people don't buy hybrid cars because the technology is still too expensive. You pay more upfront (and for repairs), and it takes years, if ever, to actually *save* money through better gas mileage. But if gas prices go up to $10/gallon, hybrids will become the cheaper option and more people will switch.  They're not being good OR evil, they're just picking the most affordable option that gets the job done.

darkcrazy
darkcrazy

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Minnesota_on_my_Mind
Minnesota_on_my_Mind

My local supermarket makes using the automated checkout lane impossible, since I'd need to look up the prices for all of the produce I buy--the clerks who do this all day know the correct codes from memory and can do this very quickly. I suppose they could prepackage all of the produce and then weigh and price each of the packages individually. But that also has a cost. TANFL.

LeonardoJuanito
LeonardoJuanito

Time to start picketing big business, they have been raping our country of our middle class wealth and it has to stop now. Small business, your neighbor needs your business and will put the money you spend in the economy, not into the hands of the wealthy.

Titanus
Titanus

“President Obama wants to raise the minimum wage by nearly 40% and that may sound like a good idea. But if customers won’t pay for it, it forces employers to install technology that takes the place of entry-level jobs. Every time you use a self checkout lane or even a touch screen ordering system, it’s a task that used to be part of someone’s job description. When you raise the minimum wage a new government report confirms that up to one million jobs will disappear.”


This has been going on way before the minimum wage talk started.  The bottom line is that executives will use as few people as necessary to get the most profit.  That is all they see business as being for; maximize profit.  This is one reason why personhood for corporations is so wrong.  

micefaces
micefaces

@ChubbySurvivalist  They always have a choice. You talk like the rules of profit are the laws of physics. Big business might want us to think that way, but really it's just blackmail. The thing about power is that what it says is true only becomes true when enough people believe it- and act en masse as if there's no other way. The belief in our inability to do a thing is the reason it's never done. 

BivianPerez
BivianPerez

@ChubbySurvivalist  Companies don't have a choice? YES THEY DO, the ONLY problem for them would be that they would take home LESS profits, which is stupidly, ridiculously, inhumanely HIGH as it is. 

mjkittredge
mjkittredge

@ChubbySurvivalist Destroying American jobs for profit is evil. That affects real people. Talk to your neighbors, your family, your friends. They'll tell you what losing their job to some guy from Bangladesh who works for 30 cents a day did to their lives. (how could any worker, any company compete with a cost that low???)

Have you tried using those self checkout machines? They're horrible, user unfriendly. Anything goes wrong and you have to wait there for a manager to enter an override code or enter a price for a clearance item ect. 


Have you dealt with customer service from a person who can barely speak English with a thick accent? Did that experience make you want to continue to do business with that company?

Sure, corps can screw us for a profit, but there are consequences to that.

Minnesota_on_my_Mind
Minnesota_on_my_Mind

@Titanus  This has been going on for as long as people have engaged in commercial enterprise. If you run a business, you're always looking to operate it more efficiently, because if you don't, your competitor will, and you won't be in business anymore.  Many fewer of us work on farms than in decades and centuries past. There are no more elevator operators (at least in most places). Bank tellers are becoming increasingly rare. Robots do most of the welding of our new cars. Traditionally, this has meant a shift to more complex work that required more education. But that too may not be a panacea for ever. Consider software to replace lawyers for creating wills and simple contracts. In my view, the only long term solution to this is to reduce the average work week (at the same pay) so that we can employ more people. Business will not likely do this of their own free will, but will need to be forced to do this. Of course, this will create more incentive for businesses to further reduce their labor requirements. Looking fare enough down the road, you can see a situation in which we can produce all we need to live comfortable lives with a fraction of our current work force, even if each of us that has a job only works a few hours a week. What then?  I can't see any other solution than to just to distribute the profits from our labors among all of our citizens, and perhaps, over time, to reduce our population levels. 

LeonardoJuanito
LeonardoJuanito

@Titanus How about the business paying for it. Time they start sharing the wealth with others than just shareholders.