taxman Posted January 17, 2014 Share Posted January 17, 2014 As much as I hate to admit, he's right. Product cost £10 to produce -> Min wage goes up by £1 -> costs company more to produce product -> company raise price of product to cover cost -> Rise in price => than rise in wages, worker no better off. So what is the excuse for prices already going up year on year despite general pay freezes or below inflation rises? Link to comment Share on other sites More sharing options...
I1L2T3 Posted January 17, 2014 Share Posted January 17, 2014 Higher pay = Lower benefits bill. The only people who won't like this are the bosses of companies who won't pay a living wage to their employees. This move stops the taxpayer from subsidising exploitative employers. Well done Gideon. Maybe, but if this cuts into company profits won't they seek to cut elsewhere, perhaps using more aggressive tax avoidance, cutting jobs or shifting more people onto zero hours contracts? In fact that is probably what they will do. The effect on tax revenue could well be neutral. That said, if managed in the right way with regards to corporate behaviour this is a welcome move. Link to comment Share on other sites More sharing options...
Supertramp Posted January 17, 2014 Author Share Posted January 17, 2014 So what is the excuse for prices already going up year on year despite general pay freezes or below inflation rises? Increases in raw material prices. Link to comment Share on other sites More sharing options...
Mecky Posted January 17, 2014 Share Posted January 17, 2014 Hi Mecky. If you really didn't understand my post, you might want to back out of the thread and go somewhere more suited to your analytical skills. Let me help you: "Ocelot" begins with "O". Now you have all the tools you need to join in with one of the alphabet threads in I'm Boring. Off you pop. The rest of us can turn to the important issue of the effect of raising the minimum wage on the benefits bill. It looks like a great way to reduce benefits to me. I've grown sick and tired of paying taxes to subsidise Tesco. This is an excellent move. I fully understand thanks, which is more than can be said for some people Link to comment Share on other sites More sharing options...
Supertramp Posted January 17, 2014 Author Share Posted January 17, 2014 Maybe, but if this cuts into company profits won't they seek to cut elsewhere, perhaps using more aggressive tax avoidance, cutting jobs or shifting more people onto zero hours contracts? In fact that is probably what they will do. The effect on tax revenue could well be neutral. That said, if managed in the right way with regards to corporate behaviour this is a welcome move. There was a paper linked from I think the independent or The Economist that explained the tax revenue increases only slightly but with the benefits bill decreasing slightly more. Or that is what they expect to happen. I can't find it at the minute as on the phone but it goes into a fair bit of detail on the expected results. Link to comment Share on other sites More sharing options...
Mecky Posted January 17, 2014 Share Posted January 17, 2014 So what is the excuse for prices already going up year on year despite general pay freezes or below inflation rises? Waiting for the comeback that the weather is to blame for prices increases, especially in food. This will happen about a month before the new tax year, when shops will shove up their prices, which is less noticeable, and then shove them up again for the new tax years. It's called the squeeze Link to comment Share on other sites More sharing options...
ivanava Posted January 17, 2014 Share Posted January 17, 2014 A rise in the minimum wage will only cause an increase in prices for everything. So any increase in the minimum wage will be swallowed up by increased living costs. Stupid idea. It was on TV last night about how wages have increased in China, UK companies that outsourced to China are now considering or already moving manufacturing back to the UK, I wonder if increasing the minimum wage will just send the work back to China. ---------- Post added 17-01-2014 at 09:04 ---------- So what is the excuse for prices already going up year on year despite general pay freezes or below inflation rises? Chinese wages have increased and much of what we buy comes from China. Link to comment Share on other sites More sharing options...
rickiethecat Posted January 17, 2014 Share Posted January 17, 2014 It was on TV last night about how wages have increased in China, UK companies that outsourced to China are now considering or already moving manufacturing back to the UK, I wonder if increasing the minimum wage will just send the work back to China. This is exactly the problem. The jobs market is global these days so the whole concept of a minimum wage is only practical if every country has a minimum wage. Suppose you run a factory or a call centre and have a choice between paying British workers £7 an hour or outsourcing the jobs to Asia and saving something like 75% of your labour costs, which are you going to do? Every rise in the minimum wage makes the UK less competitive. I would scrap it altogether and give companies the right to choose how much to pay their staff without the dead hand of government interfering. ---------- Post added 17-01-2014 at 10:00 ---------- Love Sheffield forum, you know what each person is going to post before they do. Mecky will **** on any idea just because its the Tories introducing it even if she would have loved it if it was a Labour policy. Anna B will doom and gloom everything and always mention bankers or someone on high wages. Mental the lot of you. Tarra. :hihi: Spot on! The two most tedious posters on the forum summed up in one post. Well said, sir! Link to comment Share on other sites More sharing options...
Jason Bourne Posted January 17, 2014 Share Posted January 17, 2014 Every rise in the minimum wage makes the UK less competitive. I would scrap it altogether and give companies the right to choose how much to pay their staff without the dead hand of government interfering. And that is what sticks in the throat of ordinary working folk, who see the government slashing services in order to bail out banks to the tune of £hundreds of billions, just so the banksters can continue to pay themselves millions in bonuses all over again. What was the bail out, if not the dead hand of government interference? Link to comment Share on other sites More sharing options...
I1L2T3 Posted January 17, 2014 Share Posted January 17, 2014 This is exactly the problem. The jobs market is global these days so the whole concept of a minimum wage is only practical if every country has a minimum wage. Suppose you run a factory or a call centre and have a choice between paying British workers £7 an hour or outsourcing the jobs to Asia and saving something like 75% of your labour costs, which are you going to do? Every rise in the minimum wage makes the UK less competitive. I would scrap it altogether and give companies the right to choose how much to pay their staff without the dead hand of government interfering. If you could outsource and cut costs of course you would look at it. But then there are other risks and costs too - it can't be said that every shift of work overseas is a success. For some companies it has been damaging, especially the call centre angle. It isn't wages that make the UK uncompetitive - wage levels respond to living costs and if living costs are high wages will have to be high too. Controlling living costs is the way to get the UK competing, starting with housing costs. Unfortunately the last two governments seem to want to do everything they can to push housing costs ever higher. Link to comment Share on other sites More sharing options...
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