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Apple's Austin campus gains approval with new salary requirements

post #1 of 52
Thread Starter 
The addition of minimum salary requirements was enough to sway members of Texas's Travis County Commission to approve Apple's new Austin campus, along with $5.4 million in tax rebates.

The project was given final approval by the commission on Tuesday in a 4-1 vote, according to the Statesman. A new provision was added to the deal last week, requiring an average salary of $35,000 for the bottom 10 percent of Apple-employed workers, and a minimum of $11 per hour for contractors.

The deal was characterized as "in peril" just last week, as the Travis County Commissioners Court remained undecided on its own incentives tied to the project. Previously, the Austin City Council had approved its own $8.6 million grant, while the state will pitch in $21 million in incentives from the Texas Enterprise Fund.

Apple's plans call for a campus to be built in North Austin, where 3,665 new jobs will be created by 2025. The discounts offered by the three different government agencies require Apple to build an 800,000-square-foot office for $226 million.

Local officials initially chose to be aggressive in courting Apple and offering incentives because the company was looking at other potential locations for the facility. It was said that Phoenix, Ariz., was another city Apple was considering.

Apple Austin facility
Apple's facilities in Austin, Texas, via WebProNews.


Apple's plans call for the facility to be built on 38 acres of land in Austin with at least a million square feet of office space. The facility will function as Apple's new "Americas Operations Center."

An analysis conducted by Travis County has projected that Apple's project will generate $15 million in benefits for the county over the 15-year term of the contract.
post #2 of 52

It's good that they added the salary requirements.  Texas, as a whole, is an employers paradise.  Nice to see someone coming down on the side of employees for once.

post #3 of 52
Hooray! So everybody wins.

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post #4 of 52
I submit that this is NOT the job of the Austin City Counsil, this is usually nicely managed by something we like to call the "Free Market" system. I submit that the city councilmen can barely find their backsides with both hands, a map and a flashlight - to sum up the knowledge they possess in determining wages in a High Tech Industry can usually be found at the bottom of a typical birdcage.

Competition sets the wage - that's the way it's supposed to work. When you have a group of clowns arbitrarily setting wages, nothing good will come from it. If Apple is no-competitive in wages and benefits, people will leave Apple and go to Samsung, IBM, Intel, Freescale, Texas Instruments, Schlumberger or a host of other competitors in the immediate area.

Apple, and just about anyone else, knows the salary range for a given job far better than some idiot who got into politics because he was too inept to compete in the free market system. Let the free market system work, it's worked well for centuries; it only gets screwed up with know-nothing politicians start screwing with it.
post #5 of 52
Quote:
Originally Posted by Hodar View Post

I submit that this is NOT the job of the Austin City Counsil, this is usually nicely managed by something we like to call the "Free Market" system. I submit that the city councilmen can barely find their backsides with both hands, a map and a flashlight - to sum up the knowledge they possess in determining wages in a High Tech Industry can usually be found at the bottom of a typical birdcage.
Competition sets the wage - that's the way it's supposed to work. When you have a group of clowns arbitrarily setting wages, nothing good will come from it. If Apple is no-competitive in wages and benefits, people will leave Apple and go to Samsung, IBM, Intel, Freescale, Texas Instruments, Schlumberger or a host of other competitors in the immediate area.
Apple, and just about anyone else, knows the salary range for a given job far better than some idiot who got into politics because he was too inept to compete in the free market system. Let the free market system work, it's worked well for centuries; it only gets screwed up with know-nothing politicians start screwing with it.

 

Well said.

 

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post #6 of 52
Quote:
Originally Posted by WelshDog View Post

It's good that they added the salary requirements.  Texas, as a whole, is an employers paradise.  Nice to see someone coming down on the side of employees for once.

 

What is good for the company is usually pretty good for employees (as a whole), too.  When a company is doing well, they hire people.  Successful companies want to hire good people, so they also pay well.  Companies that are not doing well will start cutting costs, often meaning downsizing or salary cuts.  I'd rather be looking for work in a low-unemployment, lower-salary state like Texas than a high-unemployment, high-salary state like NY any day.

post #7 of 52
Quote:
Originally Posted by Hodar View Post

I submit that this is NOT the job of the Austin City Counsil, this is usually nicely managed by something we like to call the "Free Market" system. I submit that the city councilmen can barely find their backsides with both hands, a map and a flashlight - to sum up the knowledge they possess in determining wages in a High Tech Industry can usually be found at the bottom of a typical birdcage.
Competition sets the wage - that's the way it's supposed to work. When you have a group of clowns arbitrarily setting wages, nothing good will come from it. If Apple is no-competitive in wages and benefits, people will leave Apple and go to Samsung, IBM, Intel, Freescale, Texas Instruments, Schlumberger or a host of other competitors in the immediate area.
Apple, and just about anyone else, knows the salary range for a given job far better than some idiot who got into politics because he was too inept to compete in the free market system. Let the free market system work, it's worked well for centuries; it only gets screwed up with know-nothing politicians start screwing with it.

I'm not so sure. I agree with the idea of minimum wages. Otherwise business would be paying a large percentage of their staffs with a just barely livable wage. Competition is just part of it, and that only covers the more skilled portion of the staff, those who can shop themselves around.

Unfortunately, many workers don't have that luxury. In my two businesses, we had people from very skilled, and very expensive, to messengers who earned minimum wage. I know how it works.
post #8 of 52
Quote:
Originally Posted by Maltz View Post

What is good for the company is usually pretty good for employees (as a whole), too.  When a company is doing well, they hire people.  Successful companies want to hire good people, so they also pay well.  Companies that are not doing well will start cutting costs, often meaning downsizing or salary cuts.  I'd rather be looking for work in a low-unemployment, lower-salary state like Texas than a high-unemployment, high-salary state like NY any day.

And you live and work, where?
post #9 of 52
Quote:
Originally Posted by Hodar View Post

I submit that this is NOT the job of the Austin City Counsil, this is usually nicely managed by something we like to call the "Free Market" system. I submit that the city councilmen can barely find their backsides with both hands, a map and a flashlight - to sum up the knowledge they possess in determining wages in a High Tech Industry can usually be found at the bottom of a typical birdcage.
Competition sets the wage - that's the way it's supposed to work. When you have a group of clowns arbitrarily setting wages, nothing good will come from it. If Apple is no-competitive in wages and benefits, people will leave Apple and go to Samsung, IBM, Intel, Freescale, Texas Instruments, Schlumberger or a host of other competitors in the immediate area.
Apple, and just about anyone else, knows the salary range for a given job far better than some idiot who got into politics because he was too inept to compete in the free market system. Let the free market system work, it's worked well for centuries; it only gets screwed up with know-nothing politicians start screwing with it.

Congratulations on making some breathtakingly broad generalizations about people you have never met.

post #10 of 52
Quote:
Originally Posted by melgross View Post


I'm not so sure. I agree with the idea of minimum wages. Otherwise business would be paying a large percentage of their staffs with a just barely livable wage. Competition is just part of it, and that only covers the more skilled portion of the staff, those who can shop themselves around.
Unfortunately, many workers don't have that luxury. In my two businesses, we had people from very skilled, and very expensive, to messengers who earned minimum wage. I know how it works.

Minimum wage is one thing. Requiring an average salary of $35,000 for the lowest paid 10% is another thing entirely.


What will happen? Well, Apple will undoubtedly outsource all the low paid jobs. Janitors, receptionists, grounds maintenance employees, etc will all be subcontracted - which means that they may not get any of Apple's benefits - which are typically generous.

The city should stay out of it.

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post #11 of 52
Quote:
Originally Posted by Hodar View Post

I submit that this is NOT the job of the Austin City Counsil, this is usually nicely managed by something we like to call the "Free Market" system. I submit that the city councilmen can barely find their backsides with both hands, a map and a flashlight - to sum up the knowledge they possess in determining wages in a High Tech Industry can usually be found at the bottom of a typical birdcage.
Competition sets the wage - that's the way it's supposed to work. When you have a group of clowns arbitrarily setting wages, nothing good will come from it. If Apple is no-competitive in wages and benefits, people will leave Apple and go to Samsung, IBM, Intel, Freescale, Texas Instruments, Schlumberger or a host of other competitors in the immediate area.
Apple, and just about anyone else, knows the salary range for a given job far better than some idiot who got into politics because he was too inept to compete in the free market system. Let the free market system work, it's worked well for centuries; it only gets screwed up with know-nothing politicians start screwing with it.

I never thought I would say this but...

In this case I have do not have a problem with one of the local governments requiring this. Why? Apple is getting a taxpayer funded incentive to build this. Don't like the strings attached? Don't build it then.

 

Personally, I think states would do better with a low and consistent tax rate. I think to many times local and state governments go to far to seal the deal and end up giving away far more then they can recoup from landing that big name factory/office/whatever/

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post #12 of 52
Quote:
Originally Posted by melgross View Post


I'm not so sure. I agree with the idea of minimum wages. Otherwise business would be paying a large percentage of their staffs with a just barely livable wage. Competition is just part of it, and that only covers the more skilled portion of the staff, those who can shop themselves around.
Unfortunately, many workers don't have that luxury. In my two businesses, we had people from very skilled, and very expensive, to messengers who earned minimum wage. I know how it works.

Well I guess most of the janitors and maintenance staff will be contractors @ $11/hr. rather than employees at +/- $17.50/hr ($35,000/yr) although I'm not sure how the contractor title really works since most contractors pay their workers according to state or federal minimum wage laws. For example, if Apple contracts out the janitorial services does that mean that the contractor must pay their workers $11 per hour only when they work at the Apple facility but can pay them the state minimum wage when they are working across the street at Texas Instruments?

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post #13 of 52
Quote:
Originally Posted by Hodar View Post

I submit that this is NOT the job of the Austin City Counsil, this is usually nicely managed by something we like to call the "Free Market" system. I submit that the city councilmen can barely find their backsides with both hands, a map and a flashlight - to sum up the knowledge they possess in determining wages in a High Tech Industry can usually be found at the bottom of a typical birdcage.
Competition sets the wage - that's the way it's supposed to work. When you have a group of clowns arbitrarily setting wages, nothing good will come from it. If Apple is no-competitive in wages and benefits, people will leave Apple and go to Samsung, IBM, Intel, Freescale, Texas Instruments, Schlumberger or a host of other competitors in the immediate area.
Apple, and just about anyone else, knows the salary range for a given job far better than some idiot who got into politics because he was too inept to compete in the free market system. Let the free market system work, it's worked well for centuries; it only gets screwed up with know-nothing politicians start screwing with it.

From a simplistic view of a free market you are correct, but the model has plenty of caveats. The situation in Austin has Apple asking for a reduction in taxes (a discount) with Austin asking for something in return. Quid pro quo. This is a good thing and is the free market working.

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post #14 of 52
Quote:
Originally Posted by jragosta View Post

Minimum wage is one thing. Requiring an average salary of $35,000 for the lowest paid 10% is another thing entirely.


What will happen? Well, Apple will undoubtedly outsource all the low paid jobs. Janitors, receptionists, grounds maintenance employees, etc will all be subcontracted - which means that they may not get any of Apple's benefits - which are typically generous.

The city should stay out of it.

Yes, it seems like Austin would prefer most people would be on government benefits (those who earn less than $35k) and just lie on their back making babies.  Only the rich nerds need to actually work.  Austin will prevent others from being employed.  Sounds odd.

post #15 of 52
Quote:
Originally Posted by melgross View Post


Otherwise business would be paying a large percentage of their staffs with a just barely livable wage.

 

Why would you assume this? I'll venture a bet that most employers are actually paying higher than the state-mandated minimum wage in most cases already. But even if they were paying exactly the minimum it doesn't necessarily follow that they would all be lowered absent the mandate. Furthermore, the minimum wage can (and should) be interpreted as saying that anyone whose currently marginal labor productivity is less than $X (whatever X is) is now allowed to work.

 

 

Quote:
Originally Posted by melgross View Post


Competition is just part of it, and that only covers the more skilled portion of the staff, those who can shop themselves around.

 

Untrue. The competitive dynamics are certainly different at different wage rates, but they are non entirely absent. Its simply a fact that there are often more potential employees competing for fewer jobs at the lower end of the skill, experience and wage scale. But no law is going to alter this circumstance of supply and demand...it's only going to have (usually) negative unintended consequences like basically making people with very low marginal productivity completely unemployed (rather then employed at low wage to begin with).

 

 

Quote:
Originally Posted by melgross View Post

In my two businesses, we had people from very skilled, and very expensive, to messengers who earned minimum wage. I know how it works.

 

Perhaps, but you seem to lack a deeper understanding of the basic economics that is at work here. The simple fact is that mandatory minimum wages (set above the market clearing price), while well intended, have the unfortunate effect of making people with low experience, skills and productivity legally unemployable. In other words they tend to have the opposite effect of the stated intentions.

 

As an employer you ought to be able to realize this by simply asking yourself what happens when the cost of an employee rises (no matter what level...no matter what causes that rise in cost...e.g., wages, benefits, time off, mandatory or market-drive, etc.)

 

What happens? Do you hire more people? Fewer? Lay anyone off? Put off or reduce planned hiring? Look for ways to get more productivity out of those now more expensive employees (thus reducing the need for additional ones)? Take less profit? Raise prices? Some combindation of all these?

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post #16 of 52
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Originally Posted by SolipsismX View Post


From a simplistic view of a free market you are correct, but the model has plenty of caveats. The situation in Austin has Apple asking for a reduction in taxes (a discount) with Austin asking for something in return. Quid pro quo. This is a good thing and is the free market working.

 

Of course it is not the free market working.

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post #17 of 52
Quote:
Originally Posted by bigdaddyp View Post

I never thought I would say this but...

In this case I have do not have a problem with one of the local governments requiring this. Why? Apple is getting a taxpayer funded incentive to build this. Don't like the strings attached? Don't build it then.

 

Yes, but this is effectively corporatism (a.k.a. economic fascism or corporate socialism) on display.

 

 

Quote:
Originally Posted by bigdaddyp View Post

Personally, I think states would do better with a low and consistent tax rate. I think to many times local and state governments go to far to seal the deal and end up giving away far more then they can recoup from landing that big name factory/office/whatever/

 

Agreed. This is the better approach. No special deals for big companies. Just lower everyone's taxes.


Edited by MJ1970 - 5/1/12 at 12:35pm

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post #18 of 52
Quote:
Originally Posted by WelshDog View Post

Congratulations on making some breathtakingly broad generalizations about people you have never met.

While his generalizations may be overly broad they do highlight real problems with industries and communities in America in general. Companies coming into a community demanding "incentives" or otherwise extorting concessions from local governments open themselves up to these sorts of requirements. It is a very dirty stituation for all involved.

However this poster and others are correct in that this screws with the concept of free markets. It also puts local established businesses in bad shape as you now have to deal with artificially high wages. Generally these sorts of agreements have a negative impact on the community as a whole. The cost of housing, food and the like go up while the bulk of the wages in the community do not. We shall see how Austin benefits from this 10 years from now.
post #19 of 52

Idiot Texans and Austinites providing corporate welfare for Apple, nothing more than theft from We The People!!!!

 

When big government and big business get together to screw the people, that is called FASCISM!  

post #20 of 52
Quote:
Originally Posted by SolipsismX View Post


From a simplistic view of a free market you are correct, but the model has plenty of caveats. The situation in Austin has Apple asking for a reduction in taxes (a discount) with Austin asking for something in return. Quid pro quo. This is a good thing and is the free market working.

Next week we will read that Apple Inc. has contracted Apple, Netherlands who subcontracted Apple, Ireland who will be the official employer at the Austin facility.

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post #21 of 52
Quote:
Originally Posted by MJ1970 View Post

 

Of course it is not the free market working.

Of course it is.

 

Apple's free to build in Austin, Phoenix, or anywhere else it can convince the local governments to screw over the taxpayers.

post #22 of 52

As to the comment about "generalizations about people never met":  The generalization is not general.  It is fact.  Kind of like gravity.  FACT:  Anytime government gets it's nose into private enterprise the result is always bad.

 

To the Hodar's comment about the free market:  Sodar is correct in that the free market is not working (but then what do you expect in Austin, the most liberal town in Teas?)  In a free market, the government would not incentivize, nor would it make demands for minimum wage etc.  

 

Socialists never learn.  They keep repeating the old saw, "That last bunch of people just didn't do it right.  We are smarter.  We will do it right.  We will rule your lives for you...in your own best interest of course."

 

If government followed the advice of the Founders, it would both refuse to accept pressure from companies and stay out of the control business.  If Apple can build and survive in Austin under those rules, great.  If not, great.

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post #23 of 52
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Originally Posted by Habanero View Post

Of course it is.

 

Apple's free to build in Austin, Phoenix, or anywhere else it can convince the local governments to screw over the taxpayers.

 

That's where it stopped being a free market.

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post #24 of 52
Quote:
Originally Posted by MJ1970 View Post

 

That's where it stopped being a free market.

Governments are for sale.

 

That's the free market.

post #25 of 52
Quote:
Originally Posted by Sky King View Post

As to the comment about "generalizations about people never met":  The generalization is not general.  It is fact.  Kind of like gravity.  FACT:  Anytime government gets it's nose into private enterprise the result is always bad.

The words 'Anytime' and 'Always' in your comment are just sensationalisms, not 'FACT'. There are many things that government should do which it doesn't and many things it does which it shouldn't, however, regulation of private enterprise is not 'Always bad' as I'm sure you know, even though you claim otherwise.

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post #26 of 52

A so-called democracy which allows its alleged representatives to give tax breaks to one of the most profitable corporations on the planet should not be surprised to find itself bankrupt, and no one who does business with a corporation that achieves such a lunatic injustice should consider him or herself a good citizen.  

 

In fact, a "tax break" is something a society might give to nonprofit organizations which demonstrably exist solely for the general good of all citizens.  What we're talking about here is a blatant bribe - a back room kickback done in plain sight by a culture so far gone that we accept and even laud such things.  Austin is the equivalent of a hooker giving it a way for free in hopes of a marriage proposal that will never come:    corporations, by definitions, are loyal only to profit.

 

Of course this is perfectly legal, but what does the rule of law mean in a society where the egregiously wealthy buy lawmakers the way a working stiff might pick up a six pack of beer?  Apple has committed a legal crime which, like all such evil, will profit very few at the expense of the many.  The fact that this is perfectly normal, accepted, typical corporate behavior doesn't eschew Apple from specific culpability or its relieve its customers of responsibility.  It merely confirms that the very concept of a corporation is an unstoppable chainsaw designed so that for every one person who grasps the handle, hundreds of thousands get the blade.

 

Let's all enjoy our latest shiny toy for the four to six months before it becomes pathetically obsolete.  We're getting exactly what we pay for:  to watch our children spend their lives as desperate, economically marginal wage slaves trapped in veal fattening pens for the benefit of a few thousand people whose smug, blind faces we'll never see and whose surprisingly few names we'll never know.

 

Yes, I'm bitter.  I don't enjoy it, but it's still better than being a "temporarily inconvenienced millionaire" living in a fantasy of someone else's design.

post #27 of 52

This is why our government is screwed up, for all they know Apple may have been willing to pay a higher wage all long and with this if give permission to apple to pay less if they like. Let the free trade system work, let individual negotiate their own wages and if they feel their service are worth more that can go elsewhere. If people are not willing to except a pay less then $35K they do not have to work for Apple.

 

This is just an attempt by the local government to increase the tax rolls and make sure they all can give themselves a raise next year. This is no better than union management attempting to increase low level worker wages above where it should be for what they do. Stuff like this backfires all the time, at some point in the future Apple will decide it not work what they agreed to and level to get out of the deal.

post #28 of 52
Quote:
Originally Posted by Habanero View Post

Governments are for sale.

 

That's the free market.

 

lol.gif

 

But I disagree that it is "free market." When one band has the guns to make everyone do what they want and to confiscate property...well...there's something not so free about that.

 

But I see your point.

 

lol.gif

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post #29 of 52

As someone who has lived and worked in CA, NY and TX I think this is all too politicized and honestly people who are critical of this are confused.  Companies go where it makes financial sense for them to go, smart companies will make use of tax laws to their advantage.  Big successful companies that create good jobs can demand a lot from local governments and vice versa.  If you need a job go where the money is, who cares what the state laws happen to be.  If you can make money there or you can make a business there then good!

post #30 of 52
Quote:
Originally Posted by rbryanh View Post

A so-called democracy which allows its alleged representatives to give tax breaks to one of the most profitable corporations on the planet should not be surprised to find itself bankrupt, 

 

As was explained repeatedly, Austin will still make millions of dollars from this deal - even after the discounted tax rate. They're creating thousands of jobs and adding millions of dollars to the tax rolls. Is that how one becomes bankrupt in your world?

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post #31 of 52

If Apple  or anybody else has a problem paying $35,000 or whatever the prevailing minimum wage they're free to locate their campus in Alabama or Arkansas.  I happen to be a Republican who believes in the free market but that doesn't mean I'm some kind of 19th century "right of contract" throwback.  The Federal government through Congress and OSHA already set minimum standards for working conditions and wages. Local governments are free to to supersede these with their own standards. If their requirements are too onerous  they will find out in due time when no one want to do business there and unemployment starts rising.

 

As for the specific case $35,000 sounds about right for CSR's and the like in a place like Austin. For contracted jobs such as janitors, landscapers and cafeteria workers, $11 may be a tad high ( even in   San Fran the minimum wage is under $11 ) but its nothing outrageous.

post #32 of 52
Quote:
Originally Posted by melgross View Post

 
I'm not so sure. I agree with the idea of minimum wages. Otherwise business would be paying a large percentage of their staffs with a just barely livable wage. Competition is just part of it, and that only covers the more skilled portion of the staff, those who can shop themselves around.

Unfortunately, many workers don't have that luxury. In my two businesses, we had people from very skilled, and very expensive, to messengers who earned minimum wage. I know how it works.

 

There would be little incentive to pay even "just a barley livable wage".   So long as unemployment is high, there is no lower limit to wages other than the minimum wage laws.

post #33 of 52
Quote:
Originally Posted by ron1701 View Post

If Apple  or anybody else has a problem paying $35,000 or whatever the prevailing minimum wage they're free to locate their campus in Alabama or Arkansas.  I happen to be a Republican who believes in the free market but that doesn't mean I'm some kind of 19th century "right of contract" throwback.  The Federal government through Congress and OSHA already set minimum standards for working conditions and wages. Local governments are free to to supersede these with their own standards. If their requirements are too onerous  they will find out in due time when no one want to do business there and unemployment starts rising.

 

As for the specific case $35,000 sounds about right for CSR's and the like in a place like Austin. For contracted jobs such as janitors, landscapers and cafeteria workers, $11 may be a tad high ( even in   San Fran the minimum wage is under $11 ) but its nothing outrageous.

 

The agreement is that Apple will pay $35 K to the average of the bottom 10%. That includes a lot more than CSRs. Secretaries, janitors, mail clerks, cafeteria workers and so on (unless Apple outsources those job which means that the people will actually get LESS money and less benefits than if they were working for Apple).

And even for CSRs, the average salary is only about $33 K - and Austin is not a high cost of living area:
http://www.bls.gov/oes/current/oes_nat.htm#41-0000

 

Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

 

There would be little incentive to pay even "just a barley livable wage".   So long as unemployment is high, there is no lower limit to wages other than the minimum wage laws.

 

So $35 K is "just a barely livable wage"?

It's funny, I've made considerably more than $35 K almost my entire career - yet no one ever forced the employer to pay that salary. Salaries are determined by a balance between what the employer will pay and how little the employee will accept. While I can understand the push for a true minimum wage, setting minimum levels for higher level jobs is silly.

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post #34 of 52
Quote:
Originally Posted by Hodar View Post

I submit that this is NOT the job of the Austin City Counsil, this is usually nicely managed by something we like to call the "Free Market" system. I submit that the city councilmen can barely find their backsides with both hands, a map and a flashlight - to sum up the knowledge they possess in determining wages in a High Tech Industry can usually be found at the bottom of a typical birdcage.
Competition sets the wage - that's the way it's supposed to work. When you have a group of clowns arbitrarily setting wages, nothing good will come from it. If Apple is no-competitive in wages and benefits, people will leave Apple and go to Samsung, IBM, Intel, Freescale, Texas Instruments, Schlumberger or a host of other competitors in the immediate area.
Apple, and just about anyone else, knows the salary range for a given job far better than some idiot who got into politics because he was too inept to compete in the free market system. Let the free market system work, it's worked well for centuries; it only gets screwed up with know-nothing politicians start screwing with it.

 

If the free market system worked, we wouldn't have companies paying minimum wage, which you absolutely cannot live on in most parts of the country.   Minimum wage puts you below the poverty level.   Just because jobs are scarce doesn't make paying sub-poverty wages ethical.   

 

Real-wages for working-class people has not increased in 30 years.     The free market system does not work in this regard.   (It works well for employers, it just doesn't work very well for most employees, especially those on the lower end of the pay scale.)

 

If you want the free market system to work, then Governments should not be providing and Apple should not be asking for tax and other incentives to build there.     If you want the free-market to work, it has to work both ways.

 

There's nothing wrong with a Government asking a company to meet certain wage requirements, especially if they're going to receive various local incentives.     Because if a company doesn't pay decent wages, the local Governments wind up picking up the slack in terms of the working poor needing to rely upon Government services such as Welfare, food stamps, public hospital care, discounted health insurance programs, government-provided pre-school, etc.

post #35 of 52
Quote:

 

 

So $35 K is "just a barely livable wage"?

 

In many parts of the country, yes.    In New York, San Francisco, Boston, Chicago, Los Angeles and I suspect, a number of other cities, about the least you're finding an apartment for is $1200 a month and in New York at least, even in the outer boroughs, that would be pretty tough to find.    That's $14,400 right there.    On $35K, in a locality with federal, state and local income taxes, you'll come home with about $28,000.      So now you have $13,600 left for all other expenses.   That's $262 a week for food, insurance, transportation, clothes, furniture, utilities and medical/dental expenses not covered by your employer's plan, which these days is plenty for most people.    That's tight if you're single, but it's extremely tight if you have any dependents.      

 

In the early to mid-80's, I was a mid-level exec at a major media company.   The lowest I could get away paying anyone except for an administrative assistant was $31K.  $31K in 1985 is $65,000 in 2012 dollars.   $35K today for anyone but a student or perhaps one's very first job out of school while still living with your parents is NOTHING.

post #36 of 52
Quote:
Originally Posted by zoetmb View Post

In many parts of the country, yes.    In New York, San Francisco, Boston, Chicago, Los Angeles and I suspect, a number of other cities, about the least you're finding an apartment for is $1200 a month and in New York at least, even in the outer boroughs, that would be pretty tough to find.    That's $14,400 right there.    On $35K, in a locality with federal, state and local income taxes, you'll come home with about $28,000.      So now you have $13,600 left for all other expenses.   That's $262 a week for food, insurance, transportation, clothes, furniture, utilities and medical/dental expenses not covered by your employer's plan, which these days is plenty for most people.    That's tight if you're single, but it's extremely tight if you have any dependents.      

 

In the early to mid-80's, I was a mid-level exec at a major media company.   The lowest I could get away paying anyone except for an administrative assistant was $31K.  $31K in 1985 is $65,000 in 2012 dollars.   $35K today for anyone but a student or perhaps one's very first job out of school while still living with your parents is NOTHING.

 

Why would NYC, SF, Boston, etc be relevant here? We're talking about Austin, TX. It's not hard to find an apartment in Austin for $400.


As for the last paragraph, it's exactly the lowest level employees we're talking about. Receptionist, administrative assistant, entry level call center personnel, janitors, cafeteria workers, etc. And I can assure you that here in Tulsa (which is not that different than Austin in cost of living), most of those groups are paid less than $30 K.

Obviously, Apple felt that the extra money was balanced by the other benefits of moving to Austin, but demanding that the minimum be $35 K for the bottom 10% of employees is going to backfire. All the entry level employees will be hired via subcontractors or hired as temps - and will therefore lose out on job security and benefits.

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post #37 of 52
Quote:
Originally Posted by jragosta View Post

Minimum wage is one thing. Requiring an average salary of $35,000 for the lowest paid 10% is another thing entirely.


What will happen? Well, Apple will undoubtedly outsource all the low paid jobs. Janitors, receptionists, grounds maintenance employees, etc will all be subcontracted - which means that they may not get any of Apple's benefits - which are typically generous.


The city should stay out of it.

It's probably more complex than this.
post #38 of 52
Quote:
Originally Posted by jragosta View Post

The agreement is that Apple will pay $35 K to the average of the bottom 10%. That includes a lot more than CSRs. Secretaries, janitors, mail clerks, cafeteria workers and so on (unless Apple outsources those job which means that the people will actually get LESS money and less benefits than if they were working for Apple).


And even for CSRs, the average salary is only about $33 K - and Austin is not a high cost of living area:
http://www.bls.gov/oes/current/oes_nat.htm#41-0000


So $35 K is "just a barely livable wage"?


It's funny, I've made considerably more than $35 K almost my entire career - yet no one ever forced the employer to pay that salary. Salaries are determined by a balance between what the employer will pay and how little the employee will accept. While I can understand the push for a true minimum wage, setting minimum levels for higher level jobs is silly.

Even doctors, who are usually conservative, have unions. The quest for higher wages and better working conditions, as well as benefits, doesn't stop at some arbitrary skill level, or salary. And then, of course, you get compensation compression effects.
post #39 of 52
Quote:
Originally Posted by jragosta View Post

Why would NYC, SF, Boston, etc be relevant here? We're talking about Austin, TX. It's not hard to find an apartment in Austin for $400.


As for the last paragraph, it's exactly the lowest level employees we're talking about. Receptionist, administrative assistant, entry level call center personnel, janitors, cafeteria workers, etc. And I can assure you that here in Tulsa (which is not that different than Austin in cost of living), most of those groups are paid less than $30 K.


Obviously, Apple felt that the extra money was balanced by the other benefits of moving to Austin, but demanding that the minimum be $35 K for the bottom 10% of employees is going to backfire. All the entry level employees will be hired via subcontractors or hired as temps - and will therefore lose out on job security and benefits.

You don't know if any of your conclusion is true. Don't state it as fact. It may be true, and it may not. There could be a clause in the agreement stating that Apple,won't farm those jobs out. We really don't know.

But I'll say one thing more. Minimum wage is not a wage that people can live on without being almost destitute almost anywhere. It's not intended to be, unless you're single, and have no one else to support. Even then, it's not enough to do much more than provide the bare basics. It's hardly what I would call "livable".
post #40 of 52
Quote:
Originally Posted by melgross View Post


You don't know if any of your conclusion is true. Don't state it as fact. It may be true, and it may not. There could be a clause in the agreement stating that Apple,won't farm those jobs out. We really don't know.
But I'll say one thing more. Minimum wage is not a wage that people can live on without being almost destitute almost anywhere. It's not intended to be, unless you're single, and have no one else to support. Even then, it's not enough to do much more than provide the bare basics. It's hardly what I would call "livable".

 

Nice straw man argument. The issue isn't whether minimum wage is livable. Someone claimed that $35 K per year wasn't livable in Austin - and they were just plain wrong. That's certainly not going to make you wealthy, but it's a decent livable wage in Austin - and a large part of the country.

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