On Job Openings the Minimum Wage and Being Middle Class

Via: Zero Hedge

Submitted by Bruce Krasting on 02/13/2013 21:37 -0500

I had lunch with a friend, he was bitching and moaning about business. He’s having a very hard time closing deals – and he only gets paid when there are deals.

This fellow is a headhunter. He specializes in supplying people for the medical industry. One of his clients has given him a sweet assignment – they have a dozen job openings that need to be filled – yesterday. The job description is OT – PT (Occupational or Physical Therapist). Some additional details:

Compensation: $100 per hour.
Location: Metro NY.
Terms: This is Per Diem work. There are no benefits.

Job Requirements: The applicant must have a graduate degree and at least two year of work experience.

Hours per week: Minimum of 40. There will be the opportunity to work more hours, but the $100/hr rate stays the same.

Long Term Prospects: Most of the jobs will be converted into full time positions with an excellent benefit package in less than one-year. The per diem option will remain open. (Full time work with benefits is less than $100/hr)

Micro Economics: There are no benefits and the taxes will be high. One should expect to pay 40% taxes (11% NY State/City and this income will be subject to the new, top Federal bracket). In NY, the out of pocket cost for medical insurance is $1,000 per month ($2k for a family plan). This brings the take home, after tax and after medical insurance to $55/hr. At 45 hrs a week, 50 weeks a year, it means a take home of $123k – call it 10 grand a month of spending money. Not bad at all.

Macro Economics: To get this job you must have six years of education – four years of college, two more for the graduate work. What does that cost? It could cost over $200,000. I’ll assume only $100k. The payback on that is $1,000 per month for ten years. In addition, there is the lost income for the six years that it takes to get an education; I’ll exclude that. When you factor in the debt, it brings the real disposable income down to $9k a month.

So what’s my friend groaning about? It’s been two weeks, and he hasn’t filled one of the jobs. There is a big shortage of people with these skills.

Read more: here

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