Who is surprised?
Last week American Apparel, the biggest clothing maker in Los Angeles, said it might outsource the making of some garments to another manufacturer in the U.S., and wiped out about 500 local jobs. The company still employs about 4,000 workers in Southern California.
As the article goes on to note, American Apparel was often used as an example of a company that paid above minimum wage without apparent ill-effects. Note the use of the word ‘apparent:’ the company has been leaking money for some time now, and, well, they’re getting some of their manufacturing base out of California, aren’t they? That’s often diagnostic.
Gotta love the intersection of things getting easier to make, but not universally cheaper, huh? – Actually, you should, if you like things like ‘increasing standards of living.’ But it’s a problem for places that don’t have it internalized yet that factories are ‘things,’ too.
Via @BBUMH.
A company paying above minimum wage with no ill effects is not proof that all companies can pay above minimum wage (i.e. that the minimum wage can be raised) with no ill effects. Progressives never seem to grasp this.
Paying above-average wages for a given job role gets you above-average quality labor. Increasing the average wage rate for that job role just increases your cost for average quality labor. A business may benefit from the former, but it does not benefit from the latter.