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Writing is on the wall for entry-level jobs

Posted: January 29, 2014 - 1:04am

My favorite food in Juneau is found at the Lemon Creek Breeze Inn. The lunch burrito, available with a multitude of meats, beans and succulent spices, has been playing hob with my waistline and has got me thinking about the minimum wage. It is, you see, how the burrito is ordered that provides a perfect reason not to interfere in the relationship between employee and employer and leave alone Alaska’s minimum wage.

Employers do not hire to provide employment to the unemployed; bluntly, workers are the means by which a company produces its goods and services. Among other considerations, employers balance wages against productivity to achieve a profit. Labor costs are at the heart of the employer/employee relationship, and if they become too high, employers will look to reduce them. And where better to reduce costs than unskilled, minimum wage workers?

So back to the Breeze Inn burrito: once in the store I simply walk to the touch screen kiosks across from the bagels and place an order. No fuss, no muss, no misunderstandings, and I am free to roam about, weighing the merits of a Mountain Dew or a Mountain Bar instead of otherwise being trapped in line simply to order.

Other employers will not be far behind in introducing labor saving methods once labor costs become too onerous through increases in the minimum wage, and examples already abound throughout the town: gas stations are self-service, the pump jockeys being long gone; Fred Meyer doubled the number of self-checkout aisles in the store; and the local Blockbuster video rental franchises are on the brink as video providers find it more profitable to bypass brick and mortar stores and stream content directly to consumers instead.

Juneau, though, is not alone when it comes to reducing labor force costs, and the news is not confined simply to minimum wage workers. The marine division of Rolls Royce, according to the Financial Times, is actively developing the crewless cargo ship, as crew expenses account for up to 30% of shipping costs. Amazon’s flirtation with drone delivery was largely viewed as an early April Fool’s joke, but the Dec. 31, 2013, edition of the Juneau Empire reported that Alaska has been selected as a test location for commercial drones. If pilotless aircraft overhead aren’t enough, the state of Nevada passed a law in 2011 that explicitly authorizes driverless cars and trucks, and Google is developing such vehicles. If it is feasible that such skilled labor can be done away with, then it takes little imagination to see the writing on the wall for entry-level jobs that require few skills.

As mentioned, wages are at the heart of the employer/employee relationship. If a company hopes to make a profit, it calculates out the value of each function required for production of its goods, while potential employees take stock of their experience and their requirements when seeking a job. If the company’s needs correspond to the worker’s needs, then a relationship begins between the two. If, however, the labor market is distorted by creating an arbitrary wage floor, the effects of which ripple up the pay scale, that potential job is not created because the value of the product is eclipsed by the cost of its production.

It all starts with the minimum wage and how those who claim they are advocating for minimum wage workers, trying to provide a “living wage” for them, are actually forcing those workers out of their jobs or eliminating those jobs in their entirety. It was reported last May that McDonalds in Europe is investing in 7,000 touch-screen kiosks to replace cashiers: will McDonalds in this country be far behind, particularly if the fast food strikes of last year continue and spread? The Nov. 8, 2013, issue of the Washington Post ran a review of a new hamburger restaurant. The key sentence as it concerns the minimum wage is this: “You can order food without having a single interaction with another human being ... ”

Imagine, going to a burger joint, the epitome of entry-level employment, and not interacting with a single person because those jobs have been eliminated.

Seem farfetched? If so, go order a burrito from Breeze Inn.

• Graham G. Storey is a Juneau teacher with a master’s in public policy from the University of Chicago.

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