overhead | Barataria - The work of Erik Hare

What are you worth as an employee? A good check for anyone working is to add up what it takes to keep them employed and what their net value is to the company. A strong positive value means job security, something pretty valuable these days. But to do it right, what you cost the company is a lot more than just your salary. There are benefits, like health care and retirement plans, yes. The total cost is far more than even that and it can roughly be called the “overhead per employee”.

By the simplest calculation that’s more than 42% above what you take home, and it could be much more than that. And this overhead is one of the biggest barriers to increasing employment, reducing hours, and generally creating a better quality of life for working people in the US. Not to mention it puts us at a competitive disadvantage when it comes to creating high quality jobs.

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“Let’s tie the minimum wage to the cost of living, so that it finally becomes a wage you can live on.”
– President Obama, State of the Union Address

With these words a new policy direction was announced. It’s not a small move, especially since it’s both the biggest effort to combat the Depression since the Stimulus Act and the biggest challenge to Republicans outside of the budget negotiations (which largely go nowhere). But for many progressives a higher minimum wage is long overdue. Even more important, linking it to a “living wage” sets a precedent that has not been a part of policy in most of my advancing lifetime.

How does this go down? It’s a fight we haven’t seen for a while, so it’s hard to tell. But it’s very popular and backed by solid research as a sound public policy. If only it went even further …

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