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Minimum Wage for SoWal???

Smiling JOe avatar
SoWal Expert
18,018 views
Minimum wage NEVER is equal to a living wage ANYWHERE in the USA. But when the employer insists on a 39 1/2 hour work week (to avoid benefits) that's essentially what it's become.

I personally think the commute for low-wage employees back and forth to SoWal from "affordable" areas accounts for at least 2 hours of unpaid work per day. So at $12.50 ph for 8 hours in SoWal would be $100 per day which (if you add on the 2-hour commute) would come out to $10 per hour. Considering the additional cost of gas, wear & tear on the car, a jacked-up car insurance bill and commuting headaches...is it any wonder some would prefer just to roll out of bed and put in their 10 hours for 4-days at the DeFuniak Tastee-Freeze for a couple bucks less and getting another local part-time job to make up the couple bucks difference on the 5th day?

Just think--these poor souls have to work 1 1/2 hours to buy a fish sandwich off the bar menu at Cafe 30A (just as an example). Someone is making the money at the businesses in the area....employers are going to have to start narrowing their profit margins (or raising their prices) to pay their workers more (and yes, that may mean paying a living wage) or they will find it difficult to staff their establishments when the customers with money come rolling in the door.

The cheap labor who used to live in the surrounding communities have been pushed out of the area to make way for upscale development--now they want them to make a long commute back down in heavy, dangerous traffic for low wages? I don't think so.

Shelly, I appreciate your look at this. Working out another step brings forth another question. If these businesses, including restaurants, raise their prices to help pay higher wages, that employee to which you refer will now have more money to pay for that now even more expensive sandwich at Cafe 30A, but he wouldn't he still have to work 1.5 hours to do so, and wouldn't everyone else have to pay more too, including people not in the service industry?:idontno:

Replies

99
SHELLY avatar
SoWal Insider
#77
I think Joe's numbers are a good start--assuming of course one can find housing in SoWal for $1,000 per month. My guess is that places like that have long since been sold off for a hefty profit.

Settling on a single wage is far too simplistic. There are so many more variables to consider. For example:

Not all employees are waiters who would beef up their wages with tips (they also need house cleaners [tips are expected but rarely received]; food counter workers, clerks, lifeguards, beach chair attendants, reservation staff, security, etc.). The minimum wage will have to be set to draw in the non-tip employees.

Most of the jobs are seasonal and finding roommates and getting long-term leases wouldn't apply.

Rental units in and around a decent driving distance are as rare as rocking horse manure. Going forward one must assume there are some homeowners willing to rent their "investment" to multiple tenants in the 18-to-20 age group [not likely]. Assuming this would happen...when employees are needed most (in the tourist season) home owners who may want to rent at other times of the year will pull their rentals off the market--why get $1200 a month when you can get $1400 a week?

Lots of younger folks [and older folks] have debt obligations (car payments, student loans, tire rims, cell phone bills) and poor credit scores that would not pass muster with landlords who run credit checks before renting.

Most people who go through the time and expense of moving into an area and settle down do so with the intention (and the need) to be employed full-time. Many of SoWal jobs that go begging wouldn't provide the security needed to make people consider such a move.

Finding folks to take summer jobs in the past worked because there was a good mix of various levels of income classes scattered around the panhandle. In Destin and Panama City there were several old mid-long term furnished beach apartments and homes that had no problem housing a bunch of service workers who migrated down from the North to make money during the summer season.

In the last 2-3 years all of that changed. Old motels and apartments were torn down and replaced (or are in the process of being replaced) by high-cost condos. Older rental houses were sold and the new owners have increased rent considerably trying to cover their carrying costs and make a profit. Whole communities of low-mid income families sold out or were priced out of the area. Along with them went an entire group of young family members willing to take low-wage jobs or adults willing to take a part-time weekend job to supplement their low salaries.

When all is said and done, I can't offer up any near-term or quick fix solution--I wish you luck trying. I DO know that $12.50 isn't going to attract the quality and quantity of employees needed to support the tourist season, but throwing money at the problem appears to be the only solution until affordable housing returns to SoWal or a massive migrant worker program is employed. I think SoWal businesses are going to have a tough go of it over the next few tourist seasons until they figure it out and they'd better figure it out soon before all those new condos and housing areas come on line and are filled with folks wanting to be serviced.
Smiling JOe avatar
SoWal ExpertAuthor
#79
Shelly, that article is a dead-on mirror of Walton Co. and I am surprised to see that the numbers even correlate. It is a little lengthy compared to most posts but extremely relavant and worthy of a full read. Good job finding and posting it. :clap_1:
Kurt avatar
Admin
#80
A scene repeated again and again.

What does the commissioner expect - for the developer to sell below market value and not make a profit?
"My brother bought a house three years ago in Olympia (a Wellington subdivision) for $330,000. That same house today is selling for $780,000," Palm Beach County Commission Chairman Tony Masilotti said. "Why is that? Profit taking.

"The developer bought that land 10 years ago at $45,000 an acre, and they get two units an acre. So what's different today? Why such a price increase? They're profit-taking."
Uncle Timmy avatar
Beach Fanatic
#81
Great article Shelly.

I think it can be very helpful to see how other municipalities are dealing with similar issues.

I found two points within the article very interesting:

1) The push for 'Inclusionary Zoning' laws which require developers to include affordable housing in developments.

2) That FL has a 'housing trust fund' intended to build and/or preserve affordable housing and that Gov. Jeb Bush has rountinely raided this fund to help balance his budgets instead of using the money for its intended purpose.

Has our discussion on minimum wage lead us to a discussion about 'Inclusionary Zoning'?
SHELLY avatar
SoWal Insider
#82
A scene repeated again and again.

What does the commissioner expect - for the developer to sell below market value and not make a profit?

Kurt,
I don't think that should be the case. Clearly, "speculative frenzy" has been a HUGE factor adding to the soaring price of real estate. Let's face it--granite countertops haven't appreciated 200% in the last couple of years. :confused: Condos--build a few hundred more. Land--carve out a few more acres and fill in the wetlands. People were clearly rushing to make money before the air started seeping out of the Real Estate Bubb....ah...Whoopee Cushion. (Smart developers, realtors and investors knew the party couldn't last forever.)

Capitalism and demand for higher profit has caused these problems--capitalism is the only answer to the problem. But until affordable housing magically returns to SoWal (which I don't see anytime soon--or at all)...luring workers to the area by offering more and more money (enough to provide a living wage) is the only answer.
BeachSteelers avatar
Beach Fanatic
#83
Good reason for studying and obtaining a higher education. Minimum wage is on par with socialism. the market will dictate what wages will be w/o gov't interference. Except when illegals are constantly allowed to steal jobs at lower wages.The home building industry is a prime example. W/O a Degree one could still make a decent(livable wage) but now it's inundated with migrant or illegal workers than are paid under the table. Look all along 30A to see. Or anywhere else in the US!! Why would any employer hire someone for say a $10 min wage when they can elude employment taxes & health benefits and hire 2 illegals for $5/hr and not pay 7.5% FICA. This is now spreading throughout corporate America. Call the phone company and talk to "William" from India. Am I the only one who recognizes this problem? Stop Illegals from stealing job they are not due. Make legal Immagration the real priority. And wages and jobs will improve. Because now someone here illegally can't undermine your worth!
SHELLY avatar
SoWal Insider
#84
Good reason for studying and obtaining a higher education. Stop Illegals from stealing job they are not due. Make legal Immagration the real priority. And wages and jobs will improve. Because now someone here illegally can't undermine your worth!

There aren't many "rocket scientist" want ads in the SoWal paper so obtaining a degree won't change the labor situation in the area.

There are only 3 solutions to solving the overall labor problems of SoWal going forward:

(1) Raise wages sufficiently to convince people it's worth their while to travel 2+ hours round-trip on "Bloody Highway 98" during the peak summer tourist season

OR

(2) Build "affordable" workers' housing very close to SoWal or with reasonable public transport available (affordable means the employee should be able to pay the rent and have enough money left over to eat, pay bills & medical, and save for retirement on the wages given).

OR

(3) Establish employment services which provide seasonal, cheap migrant workers (and feed & house the same), to keep service wages low.
beachmouse avatar
Beach Fanatic
#85
There aren't many "rocket scientist" want ads in the SoWal paper so obtaining a degree won't change the labor situation in the area.

Though if you don't mind the hour commute to Eglin from the Topsail/Sacred Heart area, there are always a good number of those rocket scientist/engineering jobs on base. Or at least as long as they don't yank 46th Test Wing to Edwards like they're now threatening.
redrocket avatar
Beach Lover
#86
:bang: something has got to give. red rocket rambles four days a week and barely makes gas money. i guess everyone is on the struggle, so bar owners aren't willing to pay enough to propigate our species and we are becoming endangered. thank god for people like smiling joe who respects the institution of tipping and supporting local entertainers. all your favorite places won't be any fun when there's no good live music because we all had to drive to panama or fwb to make 6-10 bucks an hour playing our hearts out. skilled labor or unskilled labor...what about the muse? where does he/she fall by the wayside in this? ill tell you, back to the land of the day job which allows no time for practice or family. then before you know it, another band bites the dust and the bar owner finds some dj to do karaoke for $150 and we have to listen to our firends from abroad sing their fav toby kieth song instead of hot live music. everyone feels this crunch...except for big developers who have us all dangling over the flame. exit soapbox😀

on a lighter note, come watch me make my 6-10 tonite at pandoras at 7pm. i will be validated in my efforts by your presence.

ps- this isn't a stab at bar owners, just a stated fact that many other musicians would agree with.
SHELLY avatar
SoWal Insider
#87
on a lighter note, come watch me make my 6-10 tonite at pandoras at 7pm. i will be validated in my efforts by your presence.

ps- this isn't a stab at bar owners, just a stated fact that many other musicians would agree with.

May your tip jar runneth over. 😀
Smiling JOe avatar
SoWal ExpertAuthor
#88
Sorry, I forgot to mention: please remember to tip the bands and your bartenders and servers. You pay no cover to see the bands down here, so the least you can do is throw a few bucks per person their way.

Rocket, you guys should hire Melanie to pass around the tip bucket. She always seems to get people off their wallets.
SHELLY avatar
SoWal Insider
#89
Though if you don't mind the hour commute to Eglin from the Topsail/Sacred Heart area, there are always a good number of those rocket scientist/engineering jobs on base. Or at least as long as they don't yank 46th Test Wing to Edwards like they're now threatening.

If there are plenty of openings, obviously the pay and benefits aren't worth commuting or relocating to paradise for--then again, maybe prospective employees know something about the move that we don't....? :idontno:
Camp Creek Kid avatar
Christini Zambini
#90
Good reason for studying and obtaining a higher education. Minimum wage is on par with socialism. the market will dictate what wages will be w/o gov't interference. Except when illegals are constantly allowed to steal jobs at lower wages.The home building industry is a prime example. W/O a Degree one could still make a decent(livable wage) but now it's inundated with migrant or illegal workers than are paid under the table. Look all along 30A to see. Or anywhere else in the US!! Why would any employer hire someone for say a $10 min wage when they can elude employment taxes & health benefits and hire 2 illegals for $5/hr and not pay 7.5% FICA. This is now spreading throughout corporate America. Call the phone company and talk to "William" from India. Am I the only one who recognizes this problem? Stop Illegals from stealing job they are not due. Make legal Immagration the real priority. And wages and jobs will improve. Because now someone here illegally can't undermine your worth!

Foreign workers (illegal or otherwise) make much more than $5 per hour. Just because a person speaks Spanish, it doesn't mean that they are stupid. Foreign workers recognize their value and know that if someone doesn't pay them the $10 an hour that they want, someone else down the road will. There is a labor shortage in the construction industry and those who are willing to work an honest day will get paid an honest day's wage. Any employer in the construction industry would love to hire hard working, dependable, honest and legal workers, but workers of this description do not exist. Also, every penny of profit that an employer makes is taxed. An employer cannot deduct an illegal employee's wages so the employer ends up taking the hit somewhere. The FICA does get paid even if it ends up being the employer who pays it as part of the 15% self-employment tax that he pays.
beachmouse avatar
Beach Fanatic
#91
It's not so much the relocation/living expenses for the rocket scientists down here. It's just a pretty limited employee pool when you're looking for someone with five to ten years direct weapons develoment experience and top secret clearance.

A family friend is a missle development guy on the base. Over the years, he's gotten much amusement from using the line "Well actually I am a rocket scientist."
SHELLY avatar
SoWal Insider
#92
It's not so much the relocation/living expenses for the rocket scientists down here. It's just a pretty limited employee pool when you're looking for someone with five to ten years direct weapons develoment experience and top secret clearance.

I guess they'll have more luck filling the slots when they relocate to Calif--there are lots more "space cadets" out that way. 😀
SHELLY avatar
SoWal Insider
#93
Any employer in the construction industry would love to hire hard working, dependable, honest and legal workers, but workers of this description do not exist. Also, every penny of profit that an employer makes is taxed. An employer cannot deduct an illegal employee's wages so the employer ends up taking the hit somewhere.

Thanks for reminding me to light a candle tomorrow at church for the poor contractors who are "forced" to pay illegals $10 per hour under the table to build $70,000 condos they sell for $350,000. :( Sometimes life is just so damn unfair.
Camp Creek Kid avatar
Christini Zambini
#94
Thanks for reminding me to light a candle tomorrow at church for the poor contractors who are "forced" to pay illegals $10 per hour under the table to build $70,000 condos they sell for $350,000. :( Sometimes life is just so damn unfair.


My post was in response to Beachsteelers post about not being able to find a decent construction job because illegals get paid $5/hour. This is not true. Illegals get paid more than that, they're not flooding the market with CHEAP labor, they pretty much are the only labor available. A legal worker who would actually work and be dependable would be very valuable to any employer and would get paid accordingly. It is a myth that illegal workers are taking jobs from legal workers.

Your numbers on construction are low. Try a minimum of $150/sq. ft. for construction costs alone then add to that land costs, interest, realtors commissions and you'll be closer to the mark.
Mango avatar
SoWal Insider
#95
Presently, I am not about to calculate the salary needed for a mid-level manager who wants to buy the starter home, costing $300K in SoWal. If someone else wants to do so, be sure to include the cost of homeowner's insurance and taxes. The calculation is easy, but most of you will freak out when you see the minimum salary needed.

This would be too difficult to calculate due to all the variables involved.
How much money is this person putting down on the house? Most mid-level management people would have most likely already owned a home already or have saved some money for a down-payment. Further, what industries out there are employing middle managers? From what I have seen in the past couple of years of owning there in SoWal is either the business is run by an owner and they are employing service workers.(or trying to anyway)
Anyone who has enough business acumen does not stay working very long for anyone else. This is what I have heard from our landscapers, pool people etc., who I believe would fit your definition of service worker?
Mango avatar
SoWal Insider
#96
Great article Shelly.

I think it can be very helpful to see how other municipalities are dealing with similar issues.

I found two points within the article very interesting:

1) The push for 'Inclusionary Zoning' laws which require developers to include affordable housing in developments.

2) That FL has a 'housing trust fund' intended to build and/or preserve affordable housing and that Gov. Jeb Bush has rountinely raided this fund to help balance his budgets instead of using the money for its intended purpose.

Has our discussion on minimum wage lead us to a discussion about 'Inclusionary Zoning'?

I agree with UT. However, I don't think inclusionary Zoning would work in SoWal right now with a 50 ft height restriction. Further, owners of homes in SoWal wiould most likely not want huge projects in the area.

I think a possible solution could be North. Allow developers to build their single family home developments, and give them tax incentives for building high rises that can be offered as rentals or coops for sale. In New York, developers are given huge tax breaks for developing affordable housing. They are also given tax abatements as well. Not sure if anyone is familiar with coops as they are not popular in Florida, but they are huge here in New York. Basically you own your apt. and shares in the corporation. They are a much more affordable solution for people vs. fee simple ownership. Further, quite a few people start out in coops, then rent them out, and move to single family homes as their careers progress. In some buildings that have not converted to coop, the original developers have to cap the rents as per law (rent controlled)
Allifunn avatar
FunnChef - AlisonCooks.com
#97
I agree with UT. However, I don't think inclusionary Zoning would work in SoWal right now with a 50 ft height restriction. Further, owners of homes in SoWal wiould most likely not want huge projects in the area.

I think a possible solution could be North. Allow developers to build their single family home developments, and give them tax incentives for building high rises that can be offered as rentals or coops for sale. In New York, developers are given huge tax breaks for developing affordable housing. They are also given tax abatements as well. Not sure if anyone is familiar with coops as they are not popular in Florida, but they are huge here in New York. Basically you own your apt. and shares in the corporation. They are a much more affordable solution for people vs. fee simple ownership. Further, quite a few people start out in coops, then rent them out, and move to single family homes as their careers progress. In some buildings that have not converted to coop, the original developers have to cap the rents as per law (rent controlled)
What is the difference between coop and condo?
Mango avatar
SoWal Insider
#98
What is the difference between coop and condo?[/QUOTE

Coops are Shares in a corporation that owns the building. Proprietary Lease establishes occupancy terms. No recording of a deed or central recording of sale information.A Group of residents, mostly owners, that have the right to accept or reject applicant owners or tenants. Not appealable. Maintenance - Monthly payment that consists of building upkeep, real estate taxes and payment of the underlying coop loan, generally from when the building was converted to a coop from a rental building. In most cases 40% to 60% of the maintenance is tax deductible. Real Estate Taxes - Included in Maintenance. Some buildings have abatements that do run out and thus increase taxes later on.Prospectus / Black Book / Offering Plan and Amendments - Outline the terms of the original coop offering and amendments update along with rules of the buildingFinancials - Prepared Yearly by outside accountant to determine financial status and profitability of the coop.
Management Company - Outside company that collects maintenance, operates the building, maintains records. Smaller building may be "self managed by the occupants / owners.Financing - Certain coops have financing restrictions (down payment minimums, income minimums, etc.).
Sublet / Renting - Generally require board approval. Certain boards do not allow subletting or place limit on the sublet (2 year maximum, 1 year minimum, etc.) Sale - Certain coops have a transfer fee / flip tax that each coop seller must pay back to the coop upon sale of the unit

CONDO: Condominiums
orm of Ownership - Deed that is recorded at the county clerk's. Transferable as any other house or property.
Board Approval - 99% of the time not required.
Common Charges - Monthly payment that consists solely of building upkeep.
Real Estate Taxes - Each individual owner pays their own on each unit.
Prospectus / Black Book / Offering Plan and Amendments - Outline the terms of the original offering and amendments update along with rules of the building.
Financials - Prepared Yearly by outside accountant to determine financial status and profitability of the condo association.
Management Company - Outside company that collects maintenance, operates the building, maintains records. Smaller building may be "self managed by the occupants / owners.
Condo Attorney - Generally non existent.
Financing - Only restrictions are lender required.
Sublet / Renting - Generally no restrictions.
Sale - No restrictions. Generally no costs.

Coops are generally less expensive than condos due to the tax abatements on the land by the City. Also, some coops have commercial storefronts that help with lowering the monthly maintenance for the owners.
Bud avatar
Beach Lover
#99
as soon as i myself become employed again, i will be sure to tip, but for now may I just be a muse??? ...................lwp
cpete avatar
Beach Lover
#100
Just spent most of my lunch time and then some reading this thread!

Very interesting stuff, having spent a portion of my post college years cleaning condos and answering phones to get in 50 plus days on the snow at a quaint little ski resort town near Gunnison, Colorado back in the 90?s.

It seems like you need a large entrepreneurial, family that doesn't mind working together to make a go of it. But I guess even then the kids grow up.

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