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Finding cheap employees: Minimum Wage vs. Foreign-Worker Minimum Wages

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imported_Sasha

Senior member
A while back I did a little research on what it would take to bring some workers into the United States from the Philippines. The work was labor and low-tech, but not working in fields like a migrant worker. Because the job was long-term (permanent) in design and not migrant-work in classification, a set of federal standards came into play. One of those standards (requirements) was a set minimum wage, based per state, for the foreign worker.

If I remember correctly, in the state I am in defined that foreign-worker minimum wage at $7.45/hour, and I also had a standard for how much I could charge back to them for room & board if provided (I wouldn't, but it was noted). What got me upset wasn't that the federal DOL was telling me how much (or little) an employer could pay a foreign worker, but rather that foreign workers were practically garaunteed a premium over what employers were minimally required to pay Americans!

Compare $7.45 to $5.15 in this example of foeign-worker vs. American-worker for minimum wage standards. That is a premium of almost 45%. I wonder how the US federal government can expect that it is of some notion to allow Americans to be paid less. Does this or could this breed poverty from the American workforce base? Well, the poverty-level was defined in 2003 by the HHS as $8980 for a single-person family, but the multi-person family is (for the 48 Contiguous states & D.C.):

1 $ 8,980
2 12,120
3 15,260
4 18,400
5 21,540
6 24,680
7 27,820
8 30,960

So, a non-foreign work making minimum wage (52-weeks X 40-hours/week) makes just above the poverty level (20% above) as long as they miss no work. For a foreign worker, they are 72.5% above poverty. Okay, so I can see why some poor Americans would rather starve than work for less iunder this conception, but the insult goes further when American workers are being displaced by foreign workers working overseas.

I would now like to find out from some corporate officers for those Americans being laid-off/fired for the need to reduce operating costs, bully stock valuations, and sharpen the hue on stock portfolios what they will do when they go looking for service elsewhere.

BTW, I am still mulling the business opportunity by bringing in english-speaking ( and moderately educated) foreign workers to displace the regional foreign workers as a means to an end, and to fight back against the income-bondage institutions. Is this a 'get whitey' diatribe? Maybe. 🙂
 
Originally posted by: jimikim
W T F ?

I am an Econ major and i don't even understand wtf you are saying...
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2nd .... third year econ major @ university of michigan. No idea what is being said
 
This is not to screw americans; it's to dissuade foreigners making the same wage. If somebody is willing to pay a foreigner $7.xx/hour for a job and the minimum wage if $5.xx and they can't find an american to do it, then the americans are losing no money.

Take your stance further would you say that foreigners shoulid have $3/hour minimum? Then the americans get a special $5.xx. Yaye for them! Except, if there are foreigners around, $3 sounds better to the employer than $5.
 
Folks, I wasn't complaining. The get whitey comment was meany as a joke. Heck, I'd be whitey in this scenario. I was posting more because of my surprise of what I ran across than anything else. Heck, I am one thinking of hiring foreign labor. BTW, I did some additional research on Mexican automotive workers working in US automotive plants in Mexico. Around Mexico city they make about $5.50/hour, but can make as little as $1.50/hour in northern Mexico. Now that is cheap. And amazing enough, the minimum wages for both the Philippines and Mexico are similar (and under $50/day).

Skoorb, I understand the original concept may have been to disuade American employers from highering foreign workers, but the fact is that its backfiring as American businesses simply hire foreign workers and keep them in their native countries to the benefit of the American companies. So, instead of workers in the USA losing potential income, the American economy also loses to an extent.
 
Originally posted by: Sasha
Skoorb, I understand the original concept may have been to disuade American employers from highering foreign workers, but the fact is that its backfiring as American businesses simply hire foreign workers and keep them in their native countries to the benefit of the American companies. So, instead of workers in the USA losing potential income, the American economy also loses to an extent.
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To hire unskilled foreign workers and provide them with a place to work in their own country would require a pretty significant investment, so it is out of the reach of small companies. It does take wages out of the U.S., but it also benefits the economy with lower prices (you think Walmart could sell stuff that cheap if it was made by Americans?). I'm not an economist though, so I really couldn't tell you all of the effects it has. I'm sure companies don't want to take jobs from Americans and give them to foreigners, but we demand lower and lower prices, and they're forced to find ways to cut costs to survive.
 
Originally posted by: Sasha

Skoorb, I understand the original concept may have been to disuade American employers from highering foreign workers, but the fact is that its backfiring as American businesses simply hire foreign workers and keep them in their native countries to the benefit of the American companies. So, instead of workers in the USA losing potential income, the American economy also loses to an extent.
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The minimum wage policy for foreign vs. American workers in America has NOTHING to do with American companies hiring people to work in OTHER countries.

The policy can't be "backfiring" if it has no connection with the problem.
 
While I'm not doubting your research, I have a feeling the results don't play out in real life.

A friend of my family works for a beach town restaurant chain. (privately owned) They probably have 4-5 large restaurants and their business is VERY seasonal. (Ie they probably only need ~100 employees during the winter but maybe ~400 during the summer)

Somehow it pays off for them to go to Mexico and literally bring back literally busloads of employees for kitchen staff during the summer season. They provide food and housing for them, then ship them back at the end of the season.

Oh, and the place is nowhere near the mexican border. In fact, Canada would be a lot closer. 🙂

I'm sure there is *some* shadyness going on, but all and all it is probably mostly legitimate. I don't have the figures on how much exactly the people are making, but the restaurant is definitely out to make a buck, so I'm sure it works out significantly in their favor, considering the effort they go to to recruit these employees.
 
Originally posted by: flot
While I'm not doubting your research, I have a feeling the results don't play out in real life.

A friend of my family works for a beach town restaurant chain. (privately owned) They probably have 4-5 large restaurants and their business is VERY seasonal. (Ie they probably only need ~100 employees during the winter but maybe ~400 during the summer)

Somehow it pays off for them to go to Mexico and literally bring back literally busloads of employees for kitchen staff during the summer season. They provide food and housing for them, then ship them back at the end of the season.

Oh, and the place is nowhere near the mexican border. In fact, Canada would be a lot closer. 🙂

I'm sure there is *some* shadyness going on, but all and all it is probably mostly legitimate. I don't have the figures on how much exactly the people are making, but the restaurant is definitely out to make a buck, so I'm sure it works out significantly in their favor, considering the effort they go to to recruit these employees.
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Would they be considered migrant workers (which I gather from her post are excluded from the requirements)? They're probably taking the room and board out of their pay.
 
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