If you aren’t reading Megan McArdle every day, you are really missing out on some very thought-provoking writing in the areas of business and economics. I have been following her writing since she was blogging from a trailer at the bottom of Ground Zero where she was working for a disaster recovery firm. She progressed from there to The Economist, The Atlantic, The Daily Beast and now here.
For just one example of her insightful writing, look at this post on minimum wage jobs, “McDonalds Jobs are Drive-Thru, Not Dead End.” An excerpt:
Even if it were possible to mandate that everyone in the country make almost the median income, this would come with a cost; I’d guess that most economists would agree that such a hike in the minimum wage would cause fairly significant job losses. The direct cost of labor at an average McDonald's is about 25 percent of payroll, according to Burgerbusiness.com, and of course, everything else they buy also has a substantial labor component. If everything at McDonald's cost, say, 30 percent more, they would sell fewer burgers and need fewer staff.
The real question no one has actually answered is whether every job should pay you enough to live on your own, or whether it’s OK for there to be jobs that are mostly a temporary arrangement, a waypoint en route to somewhere else. It doesn’t strike me as obviously wrong for those jobs to exist -- especially when the alternative may be no jobs at all. Even if I did think it was wrong, I’m not sure what I’d do about it. You can make McDonald's pay people more per hour. You cannot keep McDonald's from cutting those hours.
Read the whole thing.