Sometimes this is because some people are OK with sleeping in a closet and sharing internet and toilets and so forth (I did that and, it really cut back the costs and was no significant issue to me). Others have lots of fixed costs like transport to work and morgage on a house they are paying off and can’t sell, and maybe family members who don’t have a respect for money and other hard to control costs like sick or poorly behaved children and heavy social pressures for spending money like church donations.

Some people are just poor on any income. Both in terms of them spending every dollar they have and in terms of not spending it on ensuring the basics (even some of the almost free basics, like keeping ones house clean).

1. anyone who has costed contracts would realise that the cost increase arising from an increase in wage costs is much less than the increase in wage income – as wages are only one cost of many in the provision of goods and services (and the wages of lower paid staff is only part of the wage bill).

2. and the living wage campaign is not advocating that the living wage be realised by wage increase alone – it advocates for example that the best way to realise a higher living wage for Auckland because of its higher rent costs would be a higher AS in that area.

(What a ‘reasonable’ standard of living is, is quite another debate. We would all like to be more comfortable. Is it reasonable to expect it?)

It seems the left want everyone to be able to buy the goods and services provided by 20 people, at the cost of 10, with everyone earning twice as much.

“Right, so let me understand this. The ‘living wage’ is devised by calculating the cost of living: i.e food, accommodation, transport, services, clothing and other goods required by an individual or family to attain a reasonable standard of living.”

Like that other left hobby horse, the so called child poverty level, the definition fails to provide an empirical measure or even methodology.

Given the variance in many factors nationwide, and given that some people are more ‘reasonable’ than others, it seems to me the living wage has been set at a level determined by a focus group so as to feel good to the lame and lazy and “not to bad” to the rest of us.

The emperor, as the old tale tell, has no clothes, at least not any that fit a budget.

Some people attack other suggestions on how to improve the situation. It would help the conversation if they had alternative ideas on how to fix the problem.

- WFF canned
- That money saved from WFF to go into business tax cuts.
- A rise in min wage to $18.40.

So that we might all live at this appropriate standard, lets increase the minimum wage by $5 (37%) – and adjust any wages above that appropriately (because someone on $15 or $18 also needs a payrise, and someone on $20 wants their experience or seniority recognised). This applies across the board, but lets just consider those in the food industry.

Who gets this payrise? The supermarket checkout operator; the deli counter staff; the shelf stacker; the trolley collector; the supermarket cleaner; the produce staff; the bakery assistant; the stock handler; the delivery truck driver; the warehouse dispatch workers; the food handlers; the packers; the production line workers; the factory cleaners; the canners; the produce pickers; the farm workers; the guy making the food labels; the people who make the packaging; the people pumping the fuel into the trucks which carry the food; the data entry clerks processing the food orders; the people cleaning that office… and so on and so forth. All getting a 10, 20 30 % payrise.. which means a huge increase to the wages bill of every single business or industry involved in food production.

Where does this money come from? Making as many cuts as possible, and raising the product/service cost all the way down the line…until it reaches the person standing at the till at the supermarket, who was only paid $18.50 an hour. Their “living wage’ no longer buys them the standard of living they were promised, because the cost of everything has suddenly gone up. And that’s just food…

It would cycle up forever, because the cost of everything is determined by the contributions of everyone else. If you earn as much as the next man, you can’t afford his services twenty times over.

http://www.livingwagenz.org.nz/files/embargo%20file/Living%20Wage%20Investigation%20Report.pdf