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The minimum wage in the USA has not followed inflation nor productivity

(August 2, 2013) The people earning minimum wage in MacDonalds and other fast food businesses are working now below poverty level wages. Years ago It used to be OK when these jobs were filled by youngsters entering to labor force.

With manufacturing moved from the USA to Asia and South America these people have not found any other jobs. They are now married with growing families. Even with both parents working now the are fixed to stay in poverty with no hope ever recovering.

On the other side the profits of these companies and bonuses for top management have soared to stratosphere while the opposite has happened to the middle class of America that a couple of decades ago was the undisputed world leader in income among the middle classes of the world. Today they are on 26th place and dropping like a stone.

Now the low wage earners in fast food industry are trying organize labor unions and have came together to organize a nationwide strike. It might or might not not work as there are currently millions of unemployed others ready to take any job the moment it becomes vacant!

As an icing of the top, in many US States the employment is "hire and fire at will". This means that if your supervisor does not like your face any more you can be fired on the spot for no reason at all - and no legal authority will ever interfere.

The above labor practices form integral part of the US style capitalism planned to minimize labor cost in every enviroment and bring them even down in case there has been any temporary overehating of the economy.

Is this the real reason for the so called "economic cycles" where recessions repeat roughly every 5 years. Surprising or not but this cycle matches well with the industry practice to demand financial return of at least 20% before any new investments.

Below is the short story of the US labor problems:

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