AZ Votes for Recreation Fee Increases
Tonight, it appears that AZ voters will pass Prop 202 to raise recreation use fees in Arizona. Oh, you say that's not what Prop 202 was for? It was minimum wage? That's right. Prop 202 raises the minimum wage in AZ by 31%.
I have written about the minimum wage many times. For a variety of reasons, many seasonal recreation workers in AZ, and in fact in the US, are retired folks who work for minimum wage and a camp site to take care of a facility. They love the job, and do great work, while filling seasonal jobs that younger folks trying to raise a family can't really take on. When you take all wage related costs -- wages, payroll taxes, unemployment insurances, workers comp, liability insurance, etc. -- wages drive about 2/3 of recreation costs. That means that a 31% increase in wages equates to a 20% increase in recreation use fees for camping, boating, day use, etc.
What, you say? That's not what we meant! We consumers aren't supposed to pay this extra, you business guys are! Well, my profit margin is about 5% of revenues, which is a pathetically low number for a service business. Basically, I do this for fun -- I could probably make a better return investing in government bonds. So, to avoid bankruptcy, wage increases get passed right through to use fees. And since the law requires that the minimum wage be increased every year, it means that use fees will have to go up every year (for comparison, we have been able to hold many use fees flat for 3-4 years at a time, despite fuel and other costs).
Sorry. My employees were happy to work for $5.15 an hour. They did not ask for a raise. In fact, I have a waiting list of people who want jobs at $5.15. It was the voters of Arizona who decided that my employees could no longer legally accept this amount for their labor. And, unfortunately, it is the voters of Arizona who will have to pay for this raise my employees did not even ask for.
Max:
Why do the owners of those companys not make it clear to the employees that they are fired because of the minimum wage laws or because this or that law has increased costs?
Couldn't that be used to teach people why taxes are destroying what they "should" have achieved?
November 8, 2006, 1:05 amRyan Cupples:
That would lead to company hate: "You just can't accept that people want to be paid a livable wage!"
You can't win against these idiots. You can show them that you are directly affected, that they are directly affected and it will be the evil corporation's fault.
I love how you're not only required to offer the minimum wage but they just cannot accept less, even if they really, really want less.
November 8, 2006, 4:56 amJim Collins:
I seem to remember a statement in a Business class that I took. It went something like this "All costs are eventually passed on to the consumer, either directly or indirectly.". People seem to always think in terms of money instead of buying power. Now people making minimum wage in Arizona are going to find out that their having more money in their pocket doesn't mean anything because everything is going to cost more. In the end their buying power will stay the same or actually decrease.
November 8, 2006, 6:35 amNoumenon:
Well, my profit margin is about 5% of revenues, which is a pathetically low number for a service business. Basically, I do this for fun -- I could probably make a better return investing in government bonds.
Question, do you also make a salary for managing the business, or is your profit all you get?
November 8, 2006, 7:48 amBob Smith:
Have you noticed the horrible ratchet effect of a CPI-linked minimum wage? The higher wage bumps up prices, which get reflected in an increase in CPI, which further ratchets up wages the next year, in a vicious spiral.
November 8, 2006, 11:05 pmBob Smith:
Stuff like this, and the new mandatory vacation-time law in San Francisco, makes me glad "radical outsourcing" works for my business. I have no employees, just independents doing my books, occasional clerical work, etc. Hourly costs are higher, but total costs are much lower, and new laws to "help" employees don't affect my contractors to their prices remain stable.
November 8, 2006, 11:26 pm