Minimum Wage Rises $1.05 an Hour, How Does That Cause $8 Coffees? Can Anyone Explain The Math on That

AustriaBargain on 18/06/2022 - 18:19

Been reading a lot about business owners complaining about the minimum wage increase. And I don't really understand how they can say it'll hurt them so bad or increase prices of products so much. I know other factors will increase prices, like war in Europe, supply chain, etc. but they specifically cite the minimum wage increase as the cause. If they charge $5 for a coffee now and would like to raise the price to $8 in response to the wage increase, then their workers would have to be making one coffee every three hours. The math just doesn't add up. $1.05 per hour divided by the number of coffees made on average per hour should add just a few cents to a cup. If paying just a few more dollars per hour for your staff breaks your business then you're already on the verge of bankruptcy. Plus if you're already paying minimum wage then it shows that you would like to pay your employees even less, if the law let you.

I saw one cafe owner who says he already pays his employees 20% above award claim that the minimum wage increase will somehow hurt him, despite being under no obligation to raise his employees pay because it's already nowhere near minimum wage.

Now I know some food businesses are actually very friendly and cruisey with their staff and let them work at a gentle pace, which I think is fantastic because a good work environment should be kinda relaxed imo, so the minimum pay increase will hurt them more than other businesses that drive their employees like work horses. But even then we're still talking just a few cents per item made/sold.

What does anyone else here think of it? Is anyone here making minimum wage or employee minimum wage employees?

Education & Work

Comments

        • PopCounty on 20/06/2022 - 09:27
          +1

          Do not generalise this statement. Even in 2050.
          Everyone has a choice to make and improve upon themselves or their generations.

          Jack Ma once said, “it’s not what you do between 8-5 that defines your success, rather what you do between 6-10 PM”. Pause for a moment and think what it means before complaining anything.

          • smartazz104 on 20/06/2022 - 12:30
            +1

            @PopCounty: Where is Jack these days?

            • PopCounty on 20/06/2022 - 15:04

              @smartazz104: 😂 Everywhere. Has always been.
              Now….Do you really think only Jack’s the issue here? Good luck if so.

    • leiiv on 20/06/2022 - 14:26
      -1

      I agree that "no one should be paid hundreds of millions times more than the average worker", not even God.

      But the answer is not in the income tax. Those who earn millions times over the average do not earn taxable income, so their wealth is not taxed properly.

      The reality is that people are dumb and braindead. They keep voting for Labor or Liberal for ages even thought the results are always the same.

  • Barrj46 on 19/06/2022 - 12:43
    +3

    The right wing alarmist media at their finest. Let's keep the plebs working for diddly squat, so that the upper classes can make millions and holiday in Europe every year. It's clearly bulls*&^.

  • RecklessMonkeys on 19/06/2022 - 13:00
    +1

    Spot on. And isn't it remarkable that no-one in the media is able to debunk their bullshit?

    • grr1701 on 20/06/2022 - 10:01

      Online news services such as The New Daily and The Guardian certainly give a more balanced opinion. Anything touched or even sneezed on by Murdoch? Just don’t bother.

    • Mechz on 19/06/2022 - 13:51
      +8

      You are part of the problem.

    • tonka on 19/06/2022 - 14:36
      +1

      No, the problem is minimum wage is supposed to be the lowest safety net of those processes. Not a recommendation of a fair wage. An employer paying minimum wage either has a bad business model, an oversupplied non-competitive industry or is exploiting people. And the government has been enabling this by creating an oversupply of cheap labor. There's probably enough primary resources in Australia to keep us all reasonably employed if the gov't would do something about keeping the profits and jobs in Australia

      • tsunamisurfer on 19/06/2022 - 14:56
        -4

        I put it to you that $21.50 an hour is more than fair for zero skill jobs.

        • tonka on 19/06/2022 - 15:19
          +2

          I'll put it to you that people can work damned hard with no formal qualification. And no-one has zero skills, no-one, a potato maybe has zero skills. But low skilled jobs generally require a harder physical work and subsequent higher risk to health, why should someone be paid less for hard work and physical wear and tear.

          • tsunamisurfer on 19/06/2022 - 16:03
            -1

            @tonka: Simply because the value of their work is low.

            Anyone can push a broom, flip a burger, fill a shelf, push a button on a checkout POS machine.

            Those skills are alienable at low rates.

            Just because some street sweeper busts his gut 60 hours a week in the summer heat does not mean he deserves to be paid more than a person drafting contracts or cutting out a tumor in 2 hours of air conditioning.

            • tonka on 19/06/2022 - 17:13

              @tsunamisurfer: Given a choice, I would draft contracts etc for the same wage rather than busting my gut laboring. The difference is winning the competition to get those roles, there are plenty of qualified persons flipping burgers. (By the way, very often a laborer does get paid more than a dude drafting contracts. Those jobs have also fallen victim to labor oversupply. I've seen plenty of qualified accountants etc on close to minimum wage. And yes I have 30+ years of experience in managing wages).

            • smartazz104 on 20/06/2022 - 12:40

              @tsunamisurfer: Society better hurry and automate all these "low skilled" jobs then.

    • DogGunn on 20/06/2022 - 03:26

      No one should take Dinesh D'Souza the con seriously.

    • RecklessMonkeys on 20/06/2022 - 11:21
      +2

      At what point do we stop calling them workers and start calling them slaves?

      • tsunamisurfer on 20/06/2022 - 11:33

        Slaves have no choice.

        These low skilled workers have a multitude of choices, primary of which is to leave to find a better job.

        This is exactly what I am saying, with the minimum wage removed they have even more choices, and if they don't want a job paying less they can refuse and be no worse off.

  • Gandalf the Grey on 19/06/2022 - 13:23
    +1

    Just go instant, Maccona all the way! $18 a jar and you can always pour it into your own travel mug.

    • Misha Bakunin on 19/06/2022 - 13:47
      +1

      Exactly! Why people pay so much for barrista coffee is beyond me… I'm not a big coffee drinker, mind you, just one a day.

    • Mr Haj on 20/06/2022 - 09:46
      +1

      Undercut the competition and start selling it for $7 per coffee

  • Aneurism on 19/06/2022 - 14:02
    +1

    The business owner is supposed to set pricing such that their business is sustainable and can withstand adversity whilst being competitive.

    Your decision as a consumer is to ask yourself whether you wish to pay that amount or whether you can find an alternative competitor to service your needs for a price you are satisfied with. As to the justification of the cost, that may depend on a variety of factors, including wage.

  • timhn on 19/06/2022 - 14:23

    Where and what sort of coffee you get for $8 at your local cafe? Milk flavoured coffee at Starbucks?

    Just bought a reg latte for $3.80 at a local cafe in Inner West Sydney. Looking at their menu, the large latte with fancy milk (either soy or almond type) is $6.

  • Grunntt on 19/06/2022 - 14:27

    The word you are looking for is 'profiteering'.
    Seems to be all the rage at the moment (looking at you too, oil companies with record profits)

  • [Deactivated] on 19/06/2022 - 14:43

    How do they calculate minimum wage for a casual then? Has that gone up more?

    • pformag on 19/06/2022 - 18:25

      Add an extra 20%

    • hasher22 on 20/06/2022 - 01:03
      +1

      Yes, it's just minimum wage + 25% casual loading.

      Before July 1 2022 = $25.41
      After July 1 2022 = $26.72
      Difference: $1.31

  • [Deactivated] on 19/06/2022 - 15:43
    +1

    I saw one cafe owner who says he already pays his employees 20% above award claim that the minimum wage increase will somehow hurt him, despite being under no obligation to raise his employees pay because it's already nowhere near minimum wage.

    Friends of ours own a café and also pay their staff a percentage above award wages as they want to retain good staff and ever since the pandemic, it's also a matter of attracting new staff as well. The owners will be increasing their staff wages in line with the minimum wage increase. I know they increased their coffee prices last year based on costs for everything going up and fairly certain they will increase coffee prices yet again - they're still recovering from the lockdowns and profits are very slim.

  • OzzyOzbourne on 19/06/2022 - 17:11

    Because they can…people will still buy $8 coffee and probably willing to queue for the privilege

  • pformag on 19/06/2022 - 18:18

    I work in wholesale food packaging. It's just another element in increase costs. WA is soon to ban non compostable coffee cups and lids. The cost difference is around 12%. Add to that the ban on most plastic items, the alternatives are more expensive. Then you add shipping increase, raw material increase. $8 coffee is a bit of a stretch, but I think $5 for a small is going to be the new normal.

  • gromit on 19/06/2022 - 19:24

    The math isn't as simple as just the person making the coffee, it is also the whole supply chain. They also aren't saying 5-8 purely because of min wage increase, it is all the compounding hits.

    • AustriaBargain on 19/06/2022 - 19:27

      If the entire supply chain is on minimum wage then I say that's even more reason to raise the wages. If record profits weren't enough for employers to raise wages themselves then they never would have done it. This is why we need a minimum wage in the first place, the entire supply chain would be paid even less if it weren't for laws prohibiting it.

      • gromit on 19/06/2022 - 19:28

        If you think coffee shops and roasters are on record profits you are kidding yourself.

        Fyi I agree with wage increase, just hate it when people whine that price increases are unfair because of them.

        • AustriaBargain on 19/06/2022 - 19:36
          -1

          Maybe not coffee shops in particular, because when people go to restaurants more it means they go to cafes less, but overall recreation and leisure spending is higher in the last few years than it has ever been in Australia, even despite covid.

          • gromit on 19/06/2022 - 19:46

            @AustriaBargain: And costs have skyrocketed. The problem with service industries like these is a single person or restaurant has a set capacity of how many meals/drinks/coffees they can serve a day, those limited meals have to pay everyone's wages as well as cover all the costs.

    • RecklessMonkeys on 20/06/2022 - 11:24

      Don't forget the demand chain though. People can't spend money that they don't have.

  • gconboy on 19/06/2022 - 19:51

    The cost of raw coffee has gone up mainly due to enironmental conditions impacting farmers in Brazil.

  • Ultimate Gattai on 19/06/2022 - 20:33
    -1

    OP, your maths is correct, as far as I've research (e.g. not reading Murdoch media propaganda), it looks like a $1 an hour increase for minimum wage only adds a bit more than a few cents to a cup of coffee. It's disgusting that everyone up the chain can afford to give themselves a wage and the workers at the bottom of the chain (worse yet is the amount of voters brainwashed into thinking a pay raise for minimum wage works will break the economy when we've had almost a decade of stagnant wages).

  • TSH on 19/06/2022 - 20:51
    +1

    I haven't seen the 7Eleven $1 coffees go up at all.
    In all fairness, they do pay students $6 an hour under the table so that solves that mystery.
    Is an $8 coffee like a sublime coffee from the heavens? Is the cream from real Milf?
    Do the coffee beans cascade down the contours of a lambo?
    Must be a super special cup for $8.

    • kev98 on 20/06/2022 - 05:26
      +2

      $8 cups of coffee do all of the above + increase fertility

    • ProlapsedHeinous on 22/06/2022 - 04:57

      The 7Eleven coffees make fistfuls of cash. the machines are 30k, but they sell thousands of coffees a week. ROI is very quick, the rest is profit.

  • AMLagonda on 19/06/2022 - 23:27
    +3

    I own a small business and I honestly dont know how some of these small businesses employ so many people, I cant afford any :/ and we have to work our asses off.

    Stock is going up to insane prices and there is no way I can raise prices to meet.

    • m34nstav on 20/06/2022 - 13:05
      +1

      I feel you, mate. Currently going through the sale process of a business I've had for 11 years now, hard to say goodbye but now is a very good time to let it go.

      Funny thing was I just got a letter from our main supplier last week for an across the board price rise on EVERY product. No mention of how much. I've noticed a few businesses in competition have just closed down completely, or reduced hours to compensate for higher costs. A lot of small businesses have been priced out of things, mainly op-ex costs like rent, utilities, wages and lots of supplier constraints. True 'perfect storm' of problems.

      My gut feeling is a lot of smaller businesses will fail and larger businesses will pick up the slack. Going to be some good, cheap bargains coming up soon in many sectors.

      I don't think many people have seen things have been bad for a lot of small businesses since around mid last year, and now the Covid assistance packages are gone it's all coming through now. Higher costs can only be absorbed for so long, and now it's affecting the common person through fuel and food shortages it's become more 'mainstream' and an issue that is clearly affecting them directly.

      Chin up, raises prices as much as you can and find alternatives if possible. Good luck with it all!

    • leiiv on 20/06/2022 - 14:33

      So business owners are allowed to get paid below the minimum wage but the employees are not, right?
      Can you just find people to co-own the business then?

  • Alexxx on 19/06/2022 - 23:47

    It's 10% extra on public holidays when staff are paid overtime rates.

  • nephilim on 20/06/2022 - 00:15
    +1

    Good doco from UK that was on SBS years ago, basically any coffee over small is nearly pure profit and aussies love Large/jumbo lattes.
    Place like Gloria Jeans, main cost would be milk, with those $8 flavoured iced lattes.

  • SpaceNinja on 20/06/2022 - 00:16

    7-11 coffee is $1.

  • hasher22 on 20/06/2022 - 01:00

    There's more to it than just the 5.2% wage increase. You got to keep in mind that casual workers get even more than the $1.05.

    It's also the costs of overheads that went up
    - Coffee
    - Packaging
    - Milk
    - Sugar
    - Rent
    - Electricity

    Nearly everything went up and it's not going to go back down anytime soon or will it ever.

    My mate owns a small coffee shop and his branded coffee cups from his supplier went up by 40% alone, just for the cups! As will all businesses they will try source out cheaper alternatives just like KFC switched to cabbage.

    Non-business owners usually don't have empathy regarding small business owners overheads, the wage increase is just another cost to them on their already stressful financial costs….

    • AustriaBargain on 20/06/2022 - 02:32
      +2

      Okay so let's say that the minimum wage increase has brought the average cup of coffee up by 2 cents and all those other factors brought it up by $1.80. It seems kinda silly to bemoan the minimum wage increase when it's such a negligible part of the total increase. Unless your workers are those sloths from Zootopia, making a single coffee in slow motion for two hours, then the wage increase is hardly a factor at all. Yes it's $2,000 extra a year for a full time worker, but presumably that worker is making like 100,000 coffees per year, and each and every profit from those coffees is going to the owner of the business. It seems ridiculous to begrudge a minimum wage worker $2,000 extra a year when they have devoted a year of their life serving up a hundred thousand coffees for your business. It's like saying business owners deserve all the profit from each coffee, but the worker doesn't deserve even minimal compensation for giving up a year of their life to make that happen. It's pure greed. People's time is worth something, but the way people here talk you'd think if beans double in price one year then business owners would be justified in halving their minimum worker's pay that year to make up for it.

      What is the cheaper alternative to a human that can sell, make, and serve coffees? These business owners threaten to close up their businesses in response to wage increase, but that's like cutting off your nose to spite your own face. If those workers are making you a profit and paying for your lifestyle with the sweat of their brow, then you'd never ever fire them or close down your business.

      • DemocracyManifest on 20/06/2022 - 09:52
        +3

        That’s the thing. Every ‘small business’ hospo owner wanted the nice house and lambo so they avoided payroll tax and GST as much as possible, tried as much as possible to pay suppliers and staff under the table. The pandemic reset their balance and many of them lost staff and suppliers who put up with this and all of a sudden accountants are less bullish and their financial situation is more evident haha. I was in the retail/hospo industry for a while and I’ll never go back. They target people to work for them who won’t care about getting ripped off super and penalty rates. I’ve always been a union member and when things went sour I always had to get them in to send letters of demand to the bosses to pay up when they refused

  • Spam Service on 20/06/2022 - 07:31

    It's not just the minimum wage affecting prices. Coffee beans have doubled in price globally, freight has increased in price 700%, and with interest rates rising commercial rent and repayments are increasing too.

  • mitt on 20/06/2022 - 08:02
    +3

    I am treasurer at a community sports club & all our menu items are increasing in price at the end of the month. Our staff costs, supply costs, electricity prices, maintenance costs, EVERYTHING has increased.

    We are a not for profit & most years we end up close to break even. We have had to increase prices so we aren't going backwards.

    • DarkOz on 20/06/2022 - 08:43

      This is very understandable and fair thing to do just to break even.

      We recently went to a restaurant for a family birthday dinner. After we sat down and ordered, we found that there is a temporary sign on the wall next to each table advising a "10% increase in prices due to inflation of between 40 - 80%." Obviously the restaurant can't increase their prices 20% or above so it's eating into their profits. We had no problem accepting it and the food was worth it.

      • Grunntt on 21/06/2022 - 07:20
        -2

        "10% increase in prices due to inflation of between 40 - 80%.

        ….and you just happily accept this statement as the absolute truth because it's on the wall?
        Any explanation to you about how they came up with that figure other than out of a hat?
        What version of creative accounting does it take to result in an 40 - 80% inflation figure?

        • DarkOz on 21/06/2022 - 07:40

          Do you actually go grocery shopping? We have stopped buying lettuce, tomatoes and Zucchini etc as they all have increased 100 - 200%.

          • leiiv on 21/06/2022 - 08:06
            +2

            @DarkOz: Tomatoes used to be $2 to $3, now always at $10 a kilo, lettuce iceberg used to be $1, now $10, green beans, sometimes as cheap as $1, now can be as expensive as $15. Definitely more than 200%!!!!

            • DarkOz on 21/06/2022 - 09:20
              -2

              @leiiv: I was just being extremely conservative and not going back that far in time. To me, tomatoes were around $3-4, lettuce $4-$5 and zucchini $4-$5. So that's an increase of between 100% - 200%. But you were right, easily over 200% and that was the point I tried to make above.

  • ribze1 on 20/06/2022 - 09:02
    +6

    Businesses and business owners will always say it's tough, even when they're having the best year ever. If they say things are good then workers will want a bigger piece of the pie and that can't happen.

    • harthagan on 20/06/2022 - 18:52
      +7

      Of course in bad times they are the first ones with their hands out for help from the government welfare/assistance and any additional costs must be past on to the customers. But in the good times when they are raking in the super profits they obviously keep quiet about it.

      • Windows7forever on 20/06/2022 - 21:01
        +3

        100% true. Farmers do this too.

        • DarkOz on 21/06/2022 - 09:29

          Especially the lobster farmers.

  • mia123 on 20/06/2022 - 09:10

    Of 7 of the places I know, only 2 offered to pay award rates.

    They make money from their returning customers who purchase food, not coffee. Of course, it helps the bottom line if their staff are paid less.

    In the scheme of things, it's more about whether you can keep your customers coming back or not.

  • ahly92 on 20/06/2022 - 09:14
    -1

    If the gov was so worried about the everyday jill and joe, and forced this 5% wage increase…why couldn't they just cut taxes at a likewise proportion…same (better) end result for worker but also better for businesses….oh yeah pass the buck to others

    • Grunntt on 21/06/2022 - 07:22
      +1

      If the gov was so worried about the everyday jill and joe, and forced this 5% wage increase

      May be worthwhile doing some searching to find out how this wage increase was set.

      Hint for you - it's not the government.

    • greatlamp on 21/06/2022 - 07:58

      Because as much as we play violins for small business, minimum wage is also paid by big business.

      We don't need working poor in this country. If coffee shops think they can sell a coffee at $8 let them try. It's media BS at it's best

  • MikeKulls on 20/06/2022 - 09:35
    +1

    I think the maths is simple. If they charge $8 for coffee then they will sell one every 3 hours. :-)

    On a serious note I think the cafe owners are just being alarmist

  • [Deactivated] on 20/06/2022 - 10:22
    +1

    The simple fix is to buy your own machine and make/bring your own coffee from home. The math is a no brainer with these price hikes.
    Feels like paying these prices long term would just make sure they remain high and never go down again, even when issues surrounding supply chains or the war eventually get resolved. Businesses complain about doing it tough now, but most will usually never revert the hikes they pass on to consumers even if things causing price hikes in their overheads resolve themselves or if they manage to make record profits despite said increased overhead costs.

  • frostman on 20/06/2022 - 10:57
    +1

    Since covid and the lockdowns, I've almost completely stopped buying takeaway coffee, except for very few exceptions.

    I've invested in a home machine that grinds and makes my coffee perfect.
    * I choose my own beans
    * it's way cheaper (like 20c a coffee)
    * less waste from takeaway cups

    Don't feed those hungry cafe owners money…

  • Hangryuman on 20/06/2022 - 11:01
    +1

    I'll give an example - in 1991 we went to Beijing

    before that I liked pigskin jackets I'd seen in Australia for about $80

    in Beijing I was pleased to see them for sale for about $35

    one day in our Chinese hotel I happened to see in the empty 'business office' a fax sitting in a tray not yet collected

    I looked at it - it was a quote to supply pigskin jackets, from somewhere like Mongolia or Russia

    some large number like thousands, for $8 a jacket.

    from that I took away that each contact level between raw material and retail, probably doubled the price

    as in, if I buy for $1 I want to sell for $2 - to make it worth my while - otherwise why go into business ?

    so - $8 from Russia, via Chinese distributor, Australian importer, distributor, retailer, became $80 in Australia.

    Of course I don't know - but that's my general expectation

    and why I rarely buy coffee out, even for $4, as I know I can make it myself at home for more like 40c

    if you doubt my guesstimates, ask a farmer how much he gets paid for his potatoes, or milk.

    • greatlamp on 21/06/2022 - 08:04

      As far as your example in the clothing industry goes, if they sold those jackets for $500 in Australia they would still pay suppliers about the same.

      I don't doubt your guesstimates, I think you are still too conservative

  • ProjectZero on 20/06/2022 - 11:44
    +1

    Assuming the below maths is correct (based on my home consumption for beans and milk)

    1KG bag of beans makes ~55 double shot coffee and costs ~$60 - $100 (This may be cheaper when you buy in bulk)
    1L of Almond milk makes 4 coffees and costs $3 (Again potentially cheaper in bulk)
    Water to make a double shot costs 20c (maybe more or less I'm sure its less but for the sake of this argument)
    Hourly wage of ~$22.50 and it takes you 5mins to make a coffee (I normally do a coffee in 3mins and I dont have the dual boilers so I have to wait for steam wand)

    This equates to about $4.63 per coffee not including the other overheads like rent and electricity etc. so I can understand why they'd bump the price up from $5. This is all at the cost of a "barista" style home coffee, some components should be cheaper when you buy in bulk.

    Not sure where you are getting the $8 per coffee argument though. 20% increase on a $5 cup of coffee is $6 and not $8.

    • AustriaBargain on 20/06/2022 - 12:52
      +2

      Five minutes to make a coffee? So if six people are lining up for a coffee at a stand that has a single expresso machine, one of them will be waiting half an hour for their coffee? That doesn't sound right. 12 people want a coffee and one of them will be waiting an hour. A Google search of "how many coffees can a barista make in an hour" brings up 80-90 per hour for one barista, 160-180 per hour for two baristas. Of course if there aren't 80-90 customers that hour then they won't be making that many coffees during that hour.

      The $8 coffee was from News Ltd. articles with headlines like "are you ready for the $8 coffee?".

      • tonka on 20/06/2022 - 15:39

        Lol, Can verify I've been to the coffee stand you described.

      • ProjectZero on 20/06/2022 - 15:53
        +1

        The time taken is just for reference, i would assume a professional would be a hell of a lot faster than me and i take 3 mins. It was just something to use to quantify the cost. Plus, pro machines have more outlets vs mine which is only 1. Would be cheaper the more a barista makes ofc but i truly wonder how many more coffees than 20 or so a cafe generally does in an hour.

        So the title was more of a clickbait from news instead, was wondering who is actually selling $8 a coffee lol

  • JoBevo on 20/06/2022 - 13:13

    Wages are not the only cost that has increase. Cost of materials (coffee beans) and logistics (fuel and shipping) has also skyrocketed.

  • Dack Smith on 20/06/2022 - 13:48
    +1

    The coffee may cost $20 a pop but you don’t have to buy it, brew your own.

    The minimum wage directly affects people’s ability to put food on the table and pay for utilities

    Elite “professionals” with spare cash dripping outta their arses may not like price rises but they sure as well can more than afford it.

    Right wing extremists should stop crying about the measly dollar increase, seriously it’s embarrassing now.

  • Trying2SaveABuck on 20/06/2022 - 15:10
    -3

    Still $1 at 7/11 so im alright

    From an economics 101 point of view min wage laws are bad for the economy - we have the highest min wages in the world but also one of the highest cost of living nations to live in.

    I personally dont have an issue with low paid workers making an 'extra couple bucks' but my issue is we already have a bit of 'run-away' inflation and this will only add fuel to the fire - the governments job is to run a 'good economy' which ultimately benefits all Australians and this seem a bit counter intuitive to that.

    i would of rather them up the 'tax free' threshold so low-middle income earners take home more money Net opposed to simply earning more money Gross. - this would of helped the lower income workers more and not had a negative impact on businesses that cannot afford the rise. - however it doesnt 'sound' as good to the media and governments are all about spin these days.

    • harthagan on 20/06/2022 - 19:20
      +1

      Well that would cost the government money and it would also benefit the highest income earners as well, as opposed to just the lowest earners.

      • Trying2SaveABuck on 20/06/2022 - 20:14
        -2

        raising the 'tax free threshold' helps low income workers - by definition they are low income

        it does help those who have a business as they get the benefit of lower income workers willing to work more then in turn they pay more tax as they 'generally' are in the higher tax bracket this keeps inflation steady.

        businesses going out of business reduces jobs and tax being collected thus the government loses money in both welfare and tax collection - however this is what our current government has opted of…as well as more inflation…

        majority over 70 percent of tax dollars collected comes from the top 20 percent of earners/companies

        • harthagan on 20/06/2022 - 22:40
          +3

          I dont think you know what you are talking about mate. Raising the tax free threshold helps everyone who earns above the threshold and results in everyone paying less income tax. Raising the minimum wage is targeted specifically at the lowest income earners.

          • Trying2SaveABuck on 20/06/2022 - 22:54
            -1

            @harthagan: fair point nothing wrong with 'helping' everyone though is there? opposed to helping a few people at the expense of those who might not be able to afford the extra costs?

            • greatlamp on 22/06/2022 - 06:23

              @Trying2SaveABuck: You may have missed it, inflation is out of control.

              • Trying2SaveABuck on 22/06/2022 - 16:39
                -1

                @greatlamp: 7 percent isnt 'out of control' i think it is just higher then we would like it to be…. we have had it in the stable 2-3 percent for such a long time now people dont realise how good we had it….

                Government adjusting taxes is a far better way to combat the inflation we see opposed to interest rate hikes

                Fuel, Food energy and other essentials wont come down due to the RBA increasing interest rates…..

                • greatlamp on 22/06/2022 - 17:47
                  +1

                  @Trying2SaveABuck: No, the government cutting taxes for everyone would not combat inflation. It would increase inflation. My earlier response was a bit short because I thought it would be obvious that if you give everyone more money = more inflation.

                  Fuel, food and energy are primarily influenced by global markets not debt financing, prices would increase regardless of RBA actions.

    • cashews on 21/06/2022 - 14:28

      Giving the lowest paid workers who live paycheck to paycheck $40 more a week is bad for the economy? What economics 101 class did you take?

  • SeVeN11 on 20/06/2022 - 17:00
    +2

    Small businesses are just afraid to pass the cost to the consumer, they just need to all pass the cost to consumers and then everything will be sorted.
    If I was a small business and I had a choice of passing the cost or going bankrupt, I would just pass the cost.
    One could argue if they pass the cost, they will lose customers and go bankrupt anyways… all I have to say is I rather be bankrupt later than immediately. I would secretly be hoping other small businesses shut shop instead of passing the cost so that I have a bigger market share and hopefully survive.

    PS: that segment on the news of that coffee shop paying above minimum wage was not even the problem the business was facing. It sounded like nobody on their payroll was on minimum wage anyways and the news media is just misrepresentating. Also, the owner in that news segment needs to stop crying and just pass on the cost to the consumer.

    Like the nobel winning economist, Milton Friedman said.
    The problem is us, the voters. It is because voters want governments to increase spending and not raise taxes.
    The government then oblige the voters by printing money to fund deficits and then voters pay this via the "invisible" tax called inflation.

    Inflation is created in one place and one place only… its created when the money printer turns on. This means there is more AUD in circulation for each unit of goods&services produced and this is what results in higher prices. i.e. circulating currency /goods&services produced. There is literally 26% more AUD in circulation post covid vs pre covid so in theory things should cost 26% more less any productivity gain (obviously its not evenly spread through the economy so things like healthcare, and vaccine supplier gets the line share of the newly printed AUD which then takes 12-18m to trickle back into our economy… this is why we are only feeling inflation now and not before.)

    If you look carefully at the rate at which money is being printed now and before covid, its also higher (i.e. slope of AUD being printed is steeper than pre covid), that's how Australia pays for the ongoing covid cost, natural disasters, Ukraine war etc. This means it is unlikely inflation will not return to 1-3% in the next 2-3 years and everybody should prepare for high inflation for the next 3-5 years unless you see government cut spending and increase taxes

    The only way to stop inflation is to cut government spending so that less AUD needs to be printed (i.e. reduce the money supply) or for Australia to be more productive (i.e. produce more goods&services)

  • mrhugo on 20/06/2022 - 17:13
    +1

    With all this WFH I'm lucky to buy three t/a coffee's a year. They can charge whatever they want. If I feel its not worth it, I'll won't buy it. Like anything really.

    If enough people feel the same way they can close up shop.

  • baldur on 20/06/2022 - 19:01

    If you are jealous of the money cafes make, you can start one. I'm sure unless your credit score is (profanity), you can easily get a business loan.

    • Trying2SaveABuck on 20/06/2022 - 23:01

      honestly most cafe and hospitality business struggle and i think this notion business owners are all multi-millionaires is a bit beyond insane.

      i support paying low income workers more, im undecided how i feel about forcing businesses to do it artificially.

      i read somewhere 19 out of 20 businesses out of business with 5 years if that is true then it shortly cant be all mercs and beach houses?

  • goldiep on 20/06/2022 - 19:28
    +3

    I think there is something inherently wrong with our society if people loose their minds and get arked up about increasing the MINIMUM legally allowed wage by a few bucks…

    • Trying2SaveABuck on 20/06/2022 - 23:03
      -2

      we have the highest min wage in the world there is merit in questioning the raise

      i personally have no issue with the raise but i can see where businesses in particular are coming from.

      it is easy for anyone who doesn't have to pay people the extra 5.2% that sure this is a 'good thing' but there is are legit argument labour costs in Australia are 'already' too high esp when you compare us to the rest of the world

      yet people complain we have no manufacturing….

      • baldur on 20/06/2022 - 23:48

        so manufacturing must include the exploitation of the employees? then it is good Australia has no manufacturing.

        • Trying2SaveABuck on 20/06/2022 - 23:50

          what do you think is happening in other nations?

          im not saying workers should be 'exploited' but i find it funny people are happy to throw 'ethics' out the window as long as companies like Gap, Cotton on etc are giving substandard conditions to other people it is ok to 'kill poor people' because they are from 3rd world countries…..

          no manufacturing will eventually bankrupt Australia how long do you think we can keep 'digging' things out of the ground and selling it to china for? 1,2 3 decades? then whats the plan?

          • baldur on 20/06/2022 - 23:53

            @Trying2SaveABuck: australia is in a much better position than all those other nations. seems like Australia doesn't need manufacturing. enjoy your spendings on the products that are manufactured through labor exploitation.

            • Trying2SaveABuck on 21/06/2022 - 08:59

              @baldur: fair enough i guess i think it is good low paid ppl are getting a few more bucks overall

      • leiiv on 21/06/2022 - 02:29

        So we have no manufacturing anymore. Then what kind of jobs do you think deserve a wage lower than the current minimum wage?
        Important workers like tradies, builders, miners, or those in healthcare have already earned much more than the minimum wage. Heck, even a "traffic controller" earns a very decent wage.

      • greatlamp on 21/06/2022 - 08:08
        +1

        We are on the cusp of the age of automation. Auto Manufacturing failed in this country because GM and Ford treated Australia like a third world backwater and never invested here.

        Wages in Korea and Germany aren't much lower and they manage to make better cars than we ever did.

        We will never be able to complete with low wage economies on their terms. The problem is we aren't competing with high wage economies.

        There are no STEM jobs in this country at all. Our best graduates leave and don't come back

        I'm all for lowering minimum wages when we change the tax structure, ban foreign investment and make residential real estate cheaper. Otherwise you are just going to create an underclass of poverty.

        We have been solely focused on real estate for decades, now it's time for the consequences - real estate is not a productive asset, but we will blame everything else - minimum wages, young people, avocados - rather than face reality.

        Noone needs our resources during a recession, the gaps in our economy will soon become painfully clear

  • kaleidoscope on 20/06/2022 - 23:12
    +1

    How Does That Cause $8 Coffees, Can Anyone Explain The Math on That

    Idk, but that's going to be a good conversation starter among coffee lovers in workplaces while they are waiting for their coffees in the morning, pre-lunch, post-lunch and afternoons. That's $32 right there.

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