The Ultimate Unskilled Worker
A glimpse of the future where Oregon employers move toward automation in lieu of paying low-skilled workers the onerous state minimum wage.
To attract customers, a local car dealership in Eugene, Oregon was recently spotted utilizing a life-size cardboard cutout that mechanically waves a sign. Local businesses typically rely on temporary labor to fill such positions, and judging by the sheer volume of sign wavers around the Eugene/Springfield metro area, there is more than an adequate sized labor pool.
Oregon's minimum wage is currently $8.95 per hour, the second highest in the nation. Per Oregon state law, the minimum wage is adjusted annually for inflation and is set to rise to $9.10 per hour on January 1, 2014. While the unemployment rate has gradually dropped due to a combination of modest economic improvement and workforce attrition, Oregon still ranks as having one of the higher unemployment rates in the nation at 7.7 percent.
With a high state minimum wage, new hire paperwork, and high employee turnover involved when hiring such workers, the mechanical sign is obviously a much more cost-effective solution. The break-even point for an investment that costs no more than a few hundred dollars intersects within a few weeks when compared to labor costs.
While this sign example may be an oversimplification of the issue -- automation is still a cost-prohibitive alternative to labor for many businesses. But advances in technology, along with higher demand and competition, will naturally drive down the cost of such expenditures in the future. Domestic automation of manufacturing could in fact become an economic force employing tens of thousands of skilled workers. As for those for who cannot fill skilled positions, they can expect even more scarcity of unskilled labor opportunities.
A sign of things to come (pun intended) if Democrats and the Obama administration get their way in the renewed "war on income inequality" and raise the federal minimum wage to over $10.00 an hour. As businesses are forced seek out options in order to contain costs, an increasing number of low-income folks will just become poorer.
Debra Mullins is a conservative 5th generation Oregonian who resides in Oregon's southern Willamette Valley.