Minimum wage is rising slowly, but steadily. The state with the highest minimum wage is Washington, with $11 per hour. Washington plans to increase its rate up to $13.50 per hour by 2020. California, which comes in second with $10.50, has planned to increase the minimum wage by 50 cents every year to reach $15 by 2022.
As minimum wage gets higher, the standard of living of poor workers and working students may increase. However, some CEOs and economic experts have different opinion.
Last year in November, McDonald’s decided to replace all its cashiers with the automated touch-screen kiosks in every one of their restaurant locations. Ed Rensi, the former chief executive officer of McDonald’s responded to the $15 minimum wage by saying, “I guarantee you if a $15 minimum wage goes across the country you’re going to see a job loss like you can’t believe. It’s cheaper to buy a $35,000 robot than it is to hire an employee who is inefficient making $15 an hour bagging French fries.”
Another example is Amazon Go, a store that sells groceries, drinks, and daily supplies. One fact about Amazon Go is that there are zero cashiers. People would just walk into the store, take what they want, and as they walk out, all the items will be scanned and be automatically charged from their credit/debit card.
The first Amazon Go store was opened in Seattle, Washington this year. Experts predict this will weaken efforts to increase minimum wage as the trend of automation continues.
Advocates of increased minimum wage believe higher payments can eradicate poverty and increase the standard of living. However, economists always reduce this idea with the most basic logic. Their idea is that if minimum wage gets higher, the very cost of the standard of living also increases because the labor cost went up to produce those products, resulting in nothing better for the lower class members.
