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Discussion: (179 comments)

  1. juandos

    Geez! Well if can stand the frigid temperatures in the Bakken area winters this is damn good news…

    Now if one can’t there is always the 23 Texas counties of the Eagle Ford shale…

    From the FEDERAL RESERVE BANK OF DALLAS • SECOND QUARTER 2012: For the 23 counties, the average annualized growth rate in the weekly wage during this period was 14.6 percent. By comparison, average weekly wages rose 6.8 percent in Texas, from $875 to $966, and 6.3 percent in the U.S., from $870 to $953. Given the strong growth in employment and average weekly wages in the Eagle Ford, seasonally adjusted total wages paid in its top five counties increased at an annual rate of 63.4 percent during this period, while the entire 23-county area saw a 25 percent increase.

    1. Although on the flip side apartments cost more in Williston than in Manhattan right now. So just as in any boom town throughout history, prices rise (recall the relative pricing in the gold rush towns in Ca in the late 1840s, all be it that it is mostly housing that is being high priced). I suspect that if you were to survey the prices of hookers in Williston you would find higher prices also.

      1. Citizen Buddy

        “I suspect that if you were to survey the prices of hookers in Williston you would find higher prices also.”

        Oil-rich Venezuela doesn’t allow higher prices for hookers because of the messy socialist price controls in the country. But, the hookers have a booming industry in dollar currency trading.

        1. Zipperhead

          The hookers also look forward to the U.S. Secret Service coming to town too.

      2. gary popkin

        Ha, ha, “all be it.” The word you want is “albeit” meaning although.

      3. gary d sorg

        Probably there is a shortage of housing therefore so are the rent prices. Even in a city with oil refinery such as Artesia,NM there is not a empty house or apt in town that is liveable.

      4. “all be it?”

      5. janelle

        actually, housing prices have gone way down since they have been building like crazy out there. contractors and construction workers from all over the country have been out there for the past several years building apartment complexes and housing (it’s the only place that building has been booming in this economy). Housing prices are now very affordable.

        1. A quick check of craigslist shows one-bedroom apartments in Williston in the $2,000 a month range. $1,800 a month for a one-bedroom apartment in Wildrose, 45 minutes away.

          If prices are down, what were they before?

          1. @Janelle- ” Housing prices are now very affordable.” REALLY??? I would love to know what paper you are reading? If you are not making “oil money” you can’t afford the T.P. to wipe your a$$.

      6. This is exactly right. Everything from socks to convenient store sandwiches are exceedingly high! People are still struggling to make it up there unless you were lucky enough to have a family member that had oil on their land.

    2. They left out the part about how those 86% unemployed on the indian reservation are unemployed because of real, true blue racism. I lived in Bismarck for a few months and I met quite a few people of the Standing Rock tribe. Good people but most are harshly discriminated against. The people making a big deal about Pres. Obama visiting them instead, is very important. Hello…there are jobs right there and those people can’t get hired. I watched many business owners turn them away and yell racist comments as they left. The big thing with Williston is that it is not roses, people are living in campers and renting rooms for $2000-3000 a month. Food is almost impossible to obtain. Walmart stays wiped out and people moving up there to work are strongly advised to not take their women and children because it isn’t safe. The crime rates have skyrocketed up there since this oil boom. There are rapes, murders, and abductions at an alarming rate.

      1. tracy

        Wow! Williston sounds like a truly hellish place to live. I can only wonder why anyone would do it. Do you have any idea why they would stay if they aren’t forced to?

        1. David R

          Is your question why don’t the Sioux people abandon their ancestral homes because of poor conditions? Many have already and I suspect the numbers will continue to dwindle. For workers the turnover rate has increased over 20% in two years. Some take their chances, but few are putting down roots.

          1. David

            Is your question why don’t the Sioux people abandon their ancestral homes because of poor conditions?

            No, my question is about people moving to Williston to work. Why would they stay if things are as bad as Tracy describes them.

          2. David R

            Turnover rate has increased a lot in recent years. Workers are not hanging around for very long.

      2. Simply untrue. Four years ago that may have been the case with WalMart but you’re forgetting we have two other grocery stores here. Getting food has never been an issue for me since I’ve been here (over 5 years).

        It isn’t safe?! Lol news to me. Our family has been here the whole time and I have not once encoutnered anything remotely unsafe. The crime rate has risen with the population, that happens anywhere there is growth. This is not the wild west though. The school district is amazing and just got the needed votes to start building a $34M high school campus. We have the ARC which is amazing and a ton of fun for families. There are multiple activities for kids here and several groups to help get women together.

        As for discrimination, sadly it does happen. However here in Williston if you have the qualifications you can get a job. Williston isn’t Bismarck.

  2. Joe Bannister

    Boom times.

    The answer to America’s minimum wage and poverty problems is not more government, or fantastically expensive overseas occupations of craphole nations.

    The answer, my friends, is boom times.

    Aggregate demand.

    The Fed should look for all ways possible to stimulate demand. Bring on the boom times.

    Sure, the snivelers and inflation-hysterics will wail about inflation.

    I’d like to see a market minimum wage of $15 an hour, everywhere in America.

    Shrink the federal government, and boom, baby, boom.

    1. Only because inflation is one of the main causes of every economic recession we’ve ever had. Busts are bad. Booms inevitably lead to busts. Government-stimulated booms lead to worse busts.

  3. Jack Grahl

    > The fact that Walmart is paying almost 2.5 times the minimum wage in Williston, ND is evidence that a single, national minimum wage for every city, county, labor market in the country can’t possibly make sense.

    Nice that you were able to prove the idea you were already wedded to, but there is a massive logical fallacy at work here. Are you claiming that:

    The existence of a national minimum wage somehow forces Walmart to pay low, uncompetitive wages in ND, which would leave its stores empty?

    Any minimum wage would have to be set at a level sufficiently high to support the wages of workers in the Williston Walmart, eg around $17, which would have negative consequences everywhere else in the United States?

    Minimum wage workers elsewhere in the United States are being incentivized by the $7.25 they’re getting not to go to ND where their labor could be used more efficiently? Presumably this means that the premium WalMart is paying people to move to Williston over their wages elsewhere just isn’t high enough to compensate them for having to live there.

    The minimum wage is just that, a minimum. The existence of people getting paid more than the minimum, whether they’re cashiers or professor of economics, is part of how it’s supposed to work.

    1. Jon Murphy

      Are you claiming that:

      The existence of a national minimum wage somehow forces Walmart to pay low, uncompetitive wages in ND, which would leave its stores empty?

      What? No. He is just showing that wages vary across the nation. That trying to cram everyone into a one-size-fits-all plan will not work.

      1. morganovich

        jack-

        you seem to have missed the whole point.

        his point is that walmart, like any other firm, must pay market wages. as many routinely pillory walmart as some sort of oppressor of the poor wielding monopsony power to keep wages “too low”, this would seem to be evidence that contradicts that narrative.

        what is speaks to is the need to wage flexibility.

        just as offering $7.50 in williston would result in no one working there, mandating $20 in detroit would do the same.

        the store would close or would substitute automation (as it would not be able to raise prices).

        notions of a minimum wage are as absurd as those of a maximum wage.

        1. I’m not entirely sure what you’re basing your argument on. The point of a minimum wage is to make sure everyone pays their employee’s enough to survive as decided by government. It’s one way to try and keep out slavery.

          The fact that Walmart is paying 2.5 times minimum wage is how it should be. I agree a maximum wage makes little sense in our economy, but I’m failing to see how anything here is suggesting that the minimum wage is wrong.

          To summarize: the minimum wage is an attempt to ensure that everyone is payed enough to live, it is not meant to reflect what is necessarily best for the company. If anything it tries to remain unobtrusive so that each company has plenty of freedom to set its own wage at whatever rate is best for itself.

          1. Thorin

            I’m not entirely sure what you’re basing your argument on. The point of a minimum wage is to make sure everyone pays their employee’s enough to survive as decided by government. It’s one way to try and keep out slavery.

            And that notion is falsified by the fact that Walmart in Williston must pay 2.5 times the federal minimum wage. Min wage might as well not exist.

            The point you are missing is that the employees can and will decide for themselves what amount is enough to survive. The fact that Walmart must pay $17/hr to attract workers in Williston tells you that. The minimum market wage in Williston appears to be around $15/hr. So it’s not true that government must decide for them, at what wage workers will be allowed to accept employment. The federal minimum wage, the same amount everywhere whether market wage is high or low, has no meaning in Williston.

            There is a minimum market wage everywhere, based on what an employer must pay to attract workers. The amount of that wage depends on the cost of living and number of workers available, among other things, and varies greatly from place to place within the US.

            The fact that Walmart is paying 2.5 times minimum wage is how it should be.

            How what should be? The fed min wage in Williston has no meaning. No one will work for that amount.

            I agree a maximum wage makes little sense in our economy, but I’m failing to see how anything here is suggesting that the minimum wage is wrong.

            The min wage doesn’t have any effect in some places, and keeps low skilled workers from getting jobs in other places. What’s good about it?

            To summarize: the minimum wage is an attempt to ensure that everyone is payed enough to live..”

            But it doesn’t do that.

            …it is not meant to reflect what is necessarily best for the company.

            It’s not possible that anyone in government can know what is best for companies or for workers. They can best work that out for themselves on an individual basis.

            If anything it tries to remain unobtrusive so that each company has plenty of freedom to set its own wage at whatever rate is best for itself.

            Unobtrusive? If min wage has no appreciable effect, why does it even exists?

    2. David R

      You are absolutely right. A better article would have shown higher unemployment or underemployment in places where minimum wages were recently raised. The evidence is not at all conclusive on this.

      1. David

        It’s not that straight forward. Sometimes a higher min wage is reflected directly in higher prices to consumers, sometimes in loss of other types of income such as worker benefits, sometimes in fewer jobs in the future, and sometimes in employment losses in areas not related to the wage increase as consumers adjust their spending on other things to the higher price.

        What we DO know, is that if the price of labor is raised arbitrarily, without any increase in productivity from those workers, that extra money will have to come from someone else, as nothing addition is being produced.

        1. David R

          It’s even less straight forward than that. Different theories predict different behavior from business owners and consumers in different environments. There’s no real consensus outside of the theoretical.

          On the plus side, some theories predict that businesses, when well-run, are able to absorb some labor cost increases without resorting to raising prices or mass layoffs. Business owners are often unwilling to raise prices for fear of losing fickle customers to competitors. When large numbers of people suddenly have greater disposable income, personal savings and overall economic activity increase, which in turn help banks stay liquid and keeps local firms afloat. Prices will rise over time after wage increases spur demand.

          The empirical studies that scare me do show increased unemployment of youth from poor backgrounds in cities going through recession. These are the most vulnerable groups with repercussions that can last their whole lives. However, the unemployment caused by sudden cost increases is temporary and hardly devastating in the long-term.

          The success of the min wage depends on the assumption that businesses are able to absorb sudden shocks without going under completely. If min wage affects all industries at once, executives may be motivated to accept smaller paychecks in order to keep their businesses competitive.

          1. David

            The important point is the second part of my comment. If a worker’s wage is arbitrarily increased by government fiat and not because of market forces – for example an increase in worker productivity – that extra pay will have to taken away from someone else. It’s not always obvious WHERE that money comes from, but it WILL affect employment somewhere.

            If my favorite restaurant raises prices to cover higher labor costs, I may continue going there just as often, and spending more because I like the food, but I may adjust my budget to have extra dining money by going to the movies less often. If enough people make that kind of trade off, one of the people working the snack counter at the movie may get laid off. You might not see that as a direct result of the min wage hike, but it is.

            The question remains – why would we expect business owners to pay more for labor than they get from an employees labor?

            My main point was that this article implies that high wages in one city is evidence against a successful minimum wage scheme. The article failed to show that.

            The point the article made is that the market will decide on a correct minimum wage, and imposing an arbitrary minimum by fiat may harm the very people it supposedly helps.

        2. David R

          My main point was that this article implies that high wages in one city is evidence against a successful minimum wage scheme. The article failed to show that.

          1. David R

            Ron, I have the same fears that artificial wage increases hurt the poor almost exclusively. From one perspective you could almost argue that welfare benefits are government’s way of reparations for temporarily hurting jobs through regulations and min wage.

            One recent study showed however that many hourly employees at Walmart already use supplemental government entitlements. They qualify for these benefits legally. Tax payers are paying what companies like Walmart should pay employees in the first place. Min wage tries to correct an unfortunate flaw that exists in the system.

            Price shocks occur all the time that benefit one group and hurt another. That’s how the system works. Businesses find a way to handle these shocks or they go under. You asked where the money comes from. It comes from the same places it always does: whatever is most strategically sound for each individual business. In some cases it’s layoffs. Policy makers hope it will eventually come out of executives’ bonuses.

            Th most contentious assumption about minimum wage is this: wealth in a free market society tends to end up in the exclusive control of the owners of capital. In many cases this control comes at labor’s expense. The profit motive ensures that workers will receive as little as possible, sometimes less than a livable wage. The free market system is capable of paying employees more than a live able wage. It is also capable of paying less. At those times that it pays less, the government feels it has an obligation to correct what has become a dangerous and unnecessary situation in the past.

            I’m not 100 percent convinced one way or the other. And I hope no one else is fully convinced that a pure free market is either possible or desirable. The most naive assumption is one that believes any system run by people can be perfect.

          2. David

            Ron, I have the same fears that artificial wage increases hurt the poor almost exclusively.

            Then you must either be in favor of hurting the poor, or against min wage. Who would favor hurting the poor?

            From one perspective you could almost argue that welfare benefits are government’s way of reparations for temporarily hurting jobs through regulations and min wage.

            That’s even worse. Government programs to correct harm done by government programs? What, then, is the point of having a program that hurts the poor and then another that encourages dependence? If you believe government represents us, why should we support with such nonsense?

            One recent study showed however that many hourly employees at Walmart already use supplemental government entitlements. They qualify for these benefits legally. Tax payers are paying what companies like Walmart should pay employees in the first place.

            That study is correct, but you’ve drawn the wrong conclusion. In reality Walmart is paying people some of what we, as taxpayers, would otherwise spend on welfare benefits for those people. Walmart isn’t a charity, or a welfare agency, it is a business whose purpose is to make money for the owners by serving others. Walmart does that very well, as evidenced by the huge number of people who choose to shop there instead of somewhere else. And of course at most Walmart stores, not in boom towns like Williston, there are generally dozens of applicants for every job opening. That tells you that Walmart is offering a high enough wage, or people wouldn’t respond so enthusiastically to job offers.

            Min wage tries to correct an unfortunate flaw that exists in the system.

            It’s not a flaw, it’s a feature of free markets known as freedom of association and freedom of contract. It is *choice*.
            Min wage tells people they may NOT offer to work for an employer and therefore may NOT work at all, for less than some arbitrary amount chosen by bureaucrats in Washington.

            Price shocks occur all the time that benefit one group and hurt another.

            Price shocks aren’t a mysterious force of nature. Changing prices are an indicator of the relative levels of supply and demand. Why would you recommend intentionally creating ‘price shocks” for no economically justifiable reason? That’s just cruel.

            That’s how the system works.

            Indeed it does, and it works very well, without any interference from government. It is a feature of human nature. Increased demand or scarcer supply cause prices to rise which indicates to buyers that they should buy less and to sellers that they should supply more until prices again approach equilibrium.

            Businesses find a way to handle these shocks or they go under.

            So you see no problem with government imposing arbitrary costs on businesses that may cause them to fail?

            You asked where the money comes from.

            No, I know where the money comes from, we just don’t what specific individuals will be harmed, but we know that some will be harmed.

            It comes from the same places it always does: whatever is most strategically sound for each individual business.

            And beyond that? It seldom comes entirely from businesses absorbing all costs.

            In some cases it’s layoffs.

            WHY would we advocate a policy that causes layoffs, or more likely causes fewer people to be hired in the future?

            Policy makers hope it will eventually come out of executives’ bonuses.

            OMG, WHY would they hope that? Do policymakers have some special insight into how and how much an executive should be paid? Isn’t the company they work for better at measuring their worth to the business?

            The most contentious assumption about minimum wage is this: wealth in a free market society tends to end up in the exclusive control of the owners of capital.

            Nonsense. Wealth creation benefits almost everyone in society. I can explain that if you wish, just ask, but it’s basic economics. Wealth and income are unequal? Of course they are. Those who provide the most value for others and create the most wealth are rewarded for their contributions to everybody’s well being.

            The profit motive ensures that workers will receive as little as possible

            The profit motive, the natural human tendency to get as much as possible for one’s self, also ensures that workers will receive as much as possible.

            …sometimes less than a livable wage.

            Do you mean that people aren’t paid what their productive value is to an employer? Or do you mean they aren’t paid what they and an employer agree is a fair wage for the work performed? That “living wage” idea is a slippery one. What does it even mean?

            Would you expect someone with no skills to be able to produce enough to support themselves and their families?

            The free market system is capable of paying employees more than a live able wage.

            How would you know that? what is that livable wage anyway? Don’t you think workers and employers can decide for themselves what an acceptable wage is?

            It is also capable of paying less. At those times that it pays less, the government feels it has an obligation to correct what has become a dangerous and unnecessary situation in the past.

            that’s a meaningless statement.

            I’m not 100 percent convinced one way or the other. And I hope no one else is fully convinced that a pure free market is either possible or desirable.

            I’m convinced that a purely free market is desirable but may not be possible because there are so many people like you who think someone must be in charge, and that people shouldn’t be able to make their own voluntary choices about their own lives.

            The most naive assumption is one that believes any system run by people can be perfect.

            No one believes that, David, humans aren’t perfect so no human political or economic system can be perfect, it’s just that capitalism and free markets have provided better outcomes, more prosperity and better lives for more people, than any other system ever tried.

            David, you have touched on almost all of the leftist talking points on labor in your last comment, even if only obliquely. Was that your intent?

  4. Todd Mason

    Unfortunately, $17/hr over a 40 hour week will not pay for a two-bedroom apartment in Williston. ($2,820/mo.)

    http://www.zillow.com/b/Dakota-Ridge-Apartment/48.278938,-103.625999_ll/

    1. Jon Murphy

      It won’t pay for one in Boston, either. What’s your point?

      1. Todd Mason

        Actually, it looks like Newton MA is about a grand a month cheaper and, just guessing here, offers orders of magnitude better schools.
        My point was made by Dr. Perry in his earlier post about SeaTac. What does a 250 percent wage increase get you if apartments are up 400 percent?

        1. Jon Murphy

          And you go outside Walliston, you’ll see rents drop too.

          It all depends where you are looking.

          1. Todd Mason

            There isn’t anything outside Williston.

            The MO in the Bakken Field is to get six or seven of your best buds to split the cost of a three-bedroom apt, which of course creates other shortages.

            An Oil Town Where Men Are Many, and Women Are Hounded

            http://www.nytimes.com/2013/01/16/us/16women.html?_r=0

          2. Jon Murphy

            It’s the same thing in Boston or elsewhere. Rents all depend where you want to live. My cousin is living just outside the city and his rents are about half of what is in the city. Longer commute, but cheaper rent.

            Location, location, location.

          3. Todd Mason

            To repeat, there is nothing outside Williston. The housing stock is not there. Supply and demand.

          4. Jon Murphy

            I know you said that, but there are areas where you can rent.

          5. Todd Mason

            Population density MA: 900/sqmi

            Population density ND: 10.5/sqmi

            Rent a barn? Chicken coop?

          6. morganovich

            todd-

            rent an rv, a trailer, build some prefab housing, i mean, there are an awful lot of ways to rapidly add to housing stock.

            also:

            there are lots of places outside williston.

            take a look at a map.

            minot is 3 times the size and 30 miles away.

            you have stanley, watford city, sindey, and houses in what look to be semi incorporated areas.

            there is more around williston than there is IN williston.

          7. Grant Gross

            morganovich claimed in this thread that Minot is 30 miles away from Williston. It’s not. It’s 125 miles away. That’d be a heck of a drive for a $17-an-hour job, especially in winter in North Dakota.

            The other places he or she mentioned are very small towns, and housing is either filled up or nonexistant.

            Rent in Williston will run $24k or higher for a one-bedroom apartment. That’d be two-thirds of your pre-tax income on a $17.40 an hour job, provided you’re working full time.

            As for the main point in this article: The key word in the phrase “minimum wage” is, of course, “minimum.” There’s no one forcing Wal-Mart or any other company to pay the minimum if the market demands higher wages.

            In fact, the last time I checked, there was a federal minimum wage, and in Williston, Wal-Mart is paying about $10 more an hour than that. So the argument that a minimum wage doesn’t work in all areas of the country makes absolutely no sense.

          8. Grant

            In fact, the last time I checked, there was a federal minimum wage, and in Williston, Wal-Mart is paying about $10 more an hour than that. So the argument that a minimum wage doesn’t work in all areas of the country makes absolutely no sense.

            The federal minimum wage doesn’t work in Wiliston because the market minimum wage is much higher. It has no effect in places like Williston, and most large cities where wages and costs are higher. therefore, there is no reason for a minimum wage to exist in places where the market wage is higher.

            In places where costs are lower and the market minimum wage is lower than the national minimum, the effect is to reduce employment opportunities for those with low or no skills.

            One of the points being made is that a one-size-fits-all min wage for the entire country is unrelated to reality as wages vary dramatically from location to location.

            Another point, which Jon made, is that those who advocate a minimum wage on the pretense that employers will pay very low wages if not forced to pay a minimum, are proved wrong by the fact that the market wage in Williston is much higher than the federal minimum, as you pointed out.

          9. Ron,

            I’m not sure the fact that Wal-Mart is paying a sub-standard, but above the minimum, wage in a tight labor market in a very high cost area is good evidence that a national minimum wage hike isn’t needed.

            At best, it’s evidence that a minimum wage is unnecessary at this moment in Williston.

          10. Grant

            I’m not sure the fact that Wal-Mart is paying a sub-standard, but above the minimum, wage in a tight labor market in a very high cost area is good evidence that a national minimum wage hike isn’t needed.

            How do you know Walmart is paying a sub-standard wage in Williston, and what would be a “standard” wage in this case?

            What should that minimum wage be, considering costs and wages vary dramatically from location to location all over the country?

            At best, it’s evidence that a minimum wage is unnecessary at this moment in Williston.

            If you are saying that $17/hr a fair wage in Williston? What would be a fair wage in August GA, one of the lowest cost locations in the US? Do you think the people in government who just pick a federal min wage # out of the air know what it is? Is it $7.25? More? Less?

            The point is that a one-size-fits-all federal min wage doesn’t have the same effect everywhere, for example in Williston it has no effect, in Augusta it may be above the minimum market price and keep some low skilled workers from getting jobs.

            What would you recommend?

          11. I would point out again that a minimum wage is just that, a minimum. Obviously, in some places, business will have to pay more than that to attract workers.

            Those here who want absolutely no minimum wage are out of touch with most working people in the U.S. We can argue about what the minimum wage should be, but only extreme free marketers argue there’s no need for one.

            And I would question whether the current $7.25 provides a living wage anywhere in the U.S.

            By substandard, I mean that $17 an hour in Williston leaves you with little left over when rent is $24k a year for a one bedroom apartment.

            A lot of people in this thread seem to make excuses for those pay rates, or suggest there is plenty of housing, or that rents have gone down, or that it’s ok to commute two hours for a Wal-Mart job. I would question whether many of those people have ever been to Williston or understand what’s happening there.

            There have been plenty of people who’ve figured out how to define a living wage. I’m not sure we need to reinvent the wheel here.

          12. Hi. I live in a small town 30 miles south of Williston (grew up here). There is NOTHING outside of Williston for housing either. Williston is the largest town in the area. Minot is around 250 miles away. The rest of the towns (TOWNS– Ray, Stanley, Sidney, Fairview, Watford City, etc) have no housing, and what housing is available is pretty much the same as Williston. I make $15/hr but can’t afford a one bedroom for $1500. Campers, trailers, etc are hard to come by, and a person will rent you a camper for $800/mo and you can rent a spot to park it for another $800; that’s $1600 BEFORE cost of heating in the winter and cooling in the summer… plus many of the “dry camps” have zero water hookups or electric hookups. Yes, housing is being built like crazy in Watford and Williston, but the price isn’t really going down. Due to the overnight disappearance of the oilfield in the late 80′s, which left people unemployed and entire apartment complexes empty, many new builders want their money back as quickly as possible, and so they rent at crazy prices. Also, with man camps and trailor parks– the cities are fighting to get rid of these, or preventing anymore from coming in. Sewers are at a max in Sidney, Fairview, Savage, etc and so building is not being allowed. City ordinances are making it illegal to allow campers to park in yards or driveways if they are being used as “permanent housing.”

          13. hitssquad

            @Grant
            > And I would question whether the current $7.25 provides a living wage anywhere in the U.S.

            …Then stop making it illegal for people to provide housing. In working slums, there’s zero unemployment, zero homelessness, and zero food-insecurity. Have you ever wondered why?

    2. hitssquad

      Here’s a studio for $1,400/mo. Why would you be working only 40 hours per week in the hottest labor market in the country? That doesn’t make sense. 80 hours per week works out to 347.6 hours per month x $17.20/h = $5,979/mo. That will pay for a $1,400/m studio, or a $2,820/mo 2-bedroom apt, or a $4,000/mo house.

      Plus, those are starting wages. You can start out saving nothing, and then work your way up.

      Also, if employers are desperate, you might be able to make overtime — which would explain why the starting wages are so low in comparison to the cost of living. If an employer expects to be paying overtime, then the wages he offers will be lower, in order to compensate.

      80 hours per week with full overtime at a base rate of $17.20/h would work out to far more than $6,000/month.

      1. Citizen Buddy

        “80 hours per week with full overtime at a base rate of $17.20/h would work out to far more than $6,000/month.”

        Possible during the warm months, but the weather affects many jobs during the winter by slashing hours. The $1400 a month studio is probably affordable, to allow for interruptions in cash flow.

        1. You do know that walmart frowns on overtime and in most cases tries to keep you under 40 hrs/wk so they can limit benefits, right? Next time you go shop in one, ask around.

          1. hitssquad

            @Joe

            Do you specifically know that about the Williston Walmart?

      2. Grant Gross

        Working 80 hours a week just to pay the rent? Sounds like the American Dream.

        1. hitssquad

          @Grant Gross

          Can you guess why the rents are so high. Do you think it might be because people can afford to pay them?

          1. They can’t afford to pay them on $17 an hour, unless they’re working crazy overtime.

            The oil field jobs out there are paying $100k a year or more. Wal-Mart wages are far below that.

            The reason rents are high is because there’s been a huge influx of oil workers and a low housing stock, not because Wal-Mart wages are so great.

      3. Tara Adams

        I am assuming that you think that ALL of the people who work at this Wal-mart are single with no children and live their lives only to make money. If they have any kids at all, living in Williston and working in Wal-mart is virtually impossible unless you want to rarely see your kids and live in a cramped studio. 80 hours a week?!?! Give me a break!!!!

    3. Peter M

      A lot of people use areas like Williston like temp housing. A lot of people work there seasonally, then move back to states like TX, OK, CA and AZ. So in those cases, the increase in rents do not negatively impact them as much as if they lived there year round.

    4. A lot of the employees at the Williston Walmart look like they are high school age students, and probably living at home. And the $17.20 per hour is just a STARTING wage. To retain employees, Walmart likely has to start offering pay increases pretty quickly to keep good workers from going to another employer. And there could be opportunities to work more than 40 hours per week. And perhaps some workers actually share the $2800 apartment with 2-3 roommates….

      1. Grant Gross

        $17 an hour would be great for a high school student, or if you’re not the primary breadwinner in a family.

        It’s not so great in Williston if you’re supporting a family. And yes, it’s a starting wage, but I kind of doubt that wages go up substantially after that. $20 an hour is still tough if you’re paying $25k in rent a year.

        And yes, I’m sure some workers cram three or four people into a one-bedroom apartment. That sounds like a wonderful way to live.

        1. hitssquad

          @Grant Gross
          > $20 an hour is still tough if you’re paying $25k in rent a year.

          That’s $80,000 per year (at 80 hours per week, or 4,000 hours per year.), before overtime is considered. How could you not afford $25k rent on that?

          How could rents be so high if people weren’t paying them? You’re saying people are not actually paying their rents? What are you saying? Axiomatically, What people are being payed is higher than their rental costs. It couldn’t be otherwise.

          And, as I explained in my other post, the mere existence of overtime law causes base wages to go down to compensate. What people are actually being payed per week might be higher than what might be implied by the $17.20 figure to people who believe there’s some firm natural law against anyone ever working more than 40 hours per week.

          Wait, you didn’t actually read my other post, did you?

          1. Mark, I’m not hanging on your every word, but I did read your post. What you seem to be saying is that it’s perfectly ok for those poor saps at Wal-Mart to work crazy hours or cram a bunch of people into a small apartment. Who cares about low-wage workers, right?

            But who really wants to work 80 hours a week to meet rent? Or cram four people into a two-bedroom apartment. That’s not the kind of life I’d want for myself.

            Your argument that the existence of a minimum wage causes wages to go down makes little sense when there’s already a minimum wage and Wal-Mart in Williston is paying about $10 more than the minimum. If the minimum wage went up to $15, do you really think Wal-Mart in Williston would suddenly lower its wages by $2 a hour?

            If you really want to argue that a minimum wage hike isn’t necessary, show me some places where $7.25 an hour is a living wage. Just because Wal-Mart, in a few places, pays above the minimum due to a sever labor shortage, that’s not an argument against a minimum wage.

          2. P.S. Rents are high because there’s been a huge influx of oil workers making $100k a year and a huge shortage of housing.

            Not because of Wal-Mart wages.

        2. Grant

          $17 an hour would be great for a high school student, or if you’re not the primary breadwinner in a family.

          It’s not so great in Williston if you’re supporting a family.”

          I just have to ask: Why would someone with no skills be a primary breadwinner in a family, and then why would they be living in Williston where the cost of living is so high?

          And yes, it’s a starting wage, but I kind of doubt that wages go up substantially after that. $20 an hour is still tough if you’re paying $25k in rent a year.

          If the math doesn’t work out for someone with only minimal skills, Why are they in Williston? There are many places with much lower living costs, more choices and lower prices for housing, and pretty much everything else.

          And yes, I’m sure some workers cram three or four people into a one-bedroom apartment. That sounds like a wonderful way to live.

          Then they shouldn’t do it. If living with 3 other people is troublesome, don’t go to Williston where housing is scarce and expensive. Stay where you are, or move to Detroit where you can buy a house for $500.

          1. The point here is that if you’re working a certain type of job, you’re kind of screwed wherever you go. Sure, you can buy a house in Detroit for $500, but is there work there? Can you make it there on the current minimum wage?

            Why can’t a retail worker put in 40 hours a week and make a decent living?

          2. Ron,

            It seems that you and I agree that $17 an hour in Williston is a crappy wage, unlike the original post here, which seems to trumpet $17 an hour as evidence of a great triumph of market forces.

          3. Grant

            The point here is that if you’re working a certain type of job, you’re kind of screwed wherever you go

            I don’t know if “screwed” is the right word, but yes, a particular skill set is valued pretty much the same wherever you live, relative to living costs in an area, and the cost of labor in that area. People have whatever skill sets they have, because those are the skills they have developed. If people want higher pay, they might consider improving their skills.

            Why can’t a retail worker put in 40 hours a week and make a decent living?

            That’s a two part question. The first part is easy. workers can’t work 40hrs/wk because at that rate a lot of noxious government regulations kick in related to benefits and overtime that cost an employer a lot more money, so it only makes sense to hire 2 20hr/wk workers instead. What would you do?

            The answer to the second part is that the value of a retail workers contribution to the employer’s business may not be enough to afford them a “good living”, whatever that means. Some people just don’t produce enough to provide themselves with a “good living”.

            It seems that you and I agree that $17 an hour in Williston is a crappy wage, unlike the original post here, which seems to trumpet $17 an hour as evidence of a great triumph of market forces.

            We agree that $17 is just above minimum wage in Williston. Whether or not it’s it’s crappy, depends on your definition of crappy. It seems to be the correct wage for the jobs offered. Both Walmart and their employees agree that’s the correct wage.

            Do you somehow know better than Walmart and its employees what their pay should be? Tha point of the original post about the $17/hr wages at Walmart is not that it’s high, but that it is a market wage based on conditions in Williston. The market determined what that wage should be, without any help from government meddlers. THAT’S the triumph of market forces – that a market minimum wage will present itself automatically in every labor market, whether it’s Williston or Detriot.

    5. Forty hours a week? Lol most people here don’t work that little and WalMart allows unlimited overtime up here.

  5. Jon Murphy

    Ah nothing like the law of supply and demand

  6. Enjoy Williston! You’ll have a great time. My trip there last October was enlightening.

    Take lots of photos! Multi-well pads are particularly photogenic.

    1. Citizen Buddy

      “Multi-well pads are particularly photogenic.”

      Photogenic in the eye of the beholder, but they are pleasingly petrogenic.

  7. I know many of the Indian bretheran who would jump at the chance to go to the oil fields, and earn good wages. Some already do. But when the government makes it real easy to just sit around and collect the “benefit” from Uncle, that’s not much encouragement. There is no incentive, sometimes. And, to keep the old ways alive, it’s very hard to say to the young people to “go away and get a good job”, because the tradition will die. The elders want the young people close. And, I can’t blame them.

  8. Jon Murphy

    Of course, what we also have here is a huge hole blown in the “we need minimum wage because businesses won’t pay good wages” argument.

  9. Mark,

    If Walmart is hiring people at such high wages, does that mean the company is also charging more for their products?

    If so, is that a good thing, or a bad thing?

    If not, what are they doing to maintain their profitability?

    And more importantly: how does this differ (from the customer’s perspective) from the Seattle parking company that’s charging a daily surcharge because their cost of labor has gone up?

    1. Jon Murphy

      Prices are probably higher, but I don’t know for sure.

      The main difference is this:

      What this post is about is a shift in the demand curve. A shift in the demand curve results in higher wages and higher employment. With minimum wage, it is a price floor. A price floor results in higher wages but lower employment.

    2. toochrispy

      “If Walmart is hiring people at such high wages, does that mean the company is also charging more for their products?”

      I compared the weekly flyers for the Williston ND, Bellevue WA, and Sherwood AR. Prices look virtually the same.

      “If not, what are they doing to maintain their profitability?”

      Low utilities cost in North Dakota can help Walmart maintain profitability. Also, when looking at profitability, we also have to consider the revenue part of the equation. Since economic growth is very strong in the area, Walmart likely generates a high level of sales that will cover the higher salaries to stay profitable.

      1. Todd Mason

        WMT began its takeover of US retail in rural markets by promising to charge the same price everywhere. I’m guessing the Williston store is profitable. This Business Insider photo essay says shoppers navigate big crowds and pallets in the aisles — or give up and drive to the next WMT.
        http://www.businessinsider.com/williston-nd-boomtown-faces-challenges-2013-7?op=1
        The unanswered question: Is $17/hr enough to prevent turnover and morale issues? Not hard to tell which WMTs have staffing problems.

        1. Todd

          WMT began its takeover of US retail in rural markets by promising to charge the same price everywhere.

          When you write “takover” of US retail in rural markets, The impression you give is that it’s a bad thing. If that’s the case, keep in mind that it’s all of us as customers that facilitate that “takeover” by shopping at Walmart instead of those other places.

          The unanswered question: Is $17/hr enough to prevent turnover and morale issues? Not hard to tell which WMTs have staffing problems.

          The answer is that $17/hr is probably exactly the right amount to keep and retain workers, just as $10-12 is in other locations. That number was most likely chosen after some amount of calculation rather than just randomly drawn out of a hat.

          1. Todd Mason

            No aspersion intended. In fact, WMT has serious staffing issues chainwide.

            “It’s not as though the merchandise isn’t there. It’s piling up in aisles and in the back of stores because Wal-Mart doesn’t have enough bodies to restock the shelves, according to interviews with store workers. In the past five years, the world’s largest retailer added 455 U.S. Wal-Mart stores, a 13 percent increase, according to filings and the company’s website. In the same period, its total U.S. workforce, which includes Sam’s Club employees, dropped by about 20,000, or 1.4 percent. Wal-Mart employs about 1.4 million U.S. workers.”

            http://www.bloomberg.com/news/2013-03-26/customers-flee-wal-mart-empty-shelves-for-target-costco.html

      2. marque2

        They probably make it up with volume – so yes the employees are actually a bit more productive.

        1. morganovich

          i think marque nailed it.

          it’s volume. sell more (by being the one big store in a boomtown) and you can support higher wages.

          note that it is also possible that they are just less profitable.

          if the labor market is that tight, perhaps you just have to suck up lower margins. it will stop you from investing, but you can stay in business.

          you might also shift to a more employee light format by using things like self check out and use fewer hours of the higher priced labor by substituting capital.

          1. Jon Murphy

            Which is how Wal-Mart has long made their money: volume.

          2. So you debunk the Claim that without minimum wage companies will pay next to nothing (hardly, but I’ll humor you) but also, you debunked “A higher minimum wage means higher prices”.

            As “Toochrispy” said:
            “I compared the weekly flyers for the Williston ND, Bellevue WA, and Sherwood AR. Prices look virtually the same.”

            So wait…wages went up and prices stayed aprox. the same? *GASP!* what do you know, an increase in wages DOESN’T relate directly to price jumps. And that’s because wages are FAR from the ONLY factor in pricing.

          3. So you debunk the Claim that without minimum wage companies will pay next to nothing (hardly, but I’ll humor you) but also, you debunked “A higher minimum wage means higher prices”.

            As “Toochrispy” said:
            “I compared the weekly flyers for the Williston ND, Bellevue WA, and Sherwood AR. Prices look virtually the same.”

            So wait…wages went up and prices stayed aprox. the same? *GASP!* what do you know, an increase in wages DOESN’T relate directly to price jumps. And that’s because wages are FAR from the ONLY factor in pricing.

          4. Chad

            So wait…wages went up and prices stayed aprox. the same? *GASP!* what do you know, an increase in wages DOESN’T relate directly to price jumps. And that’s because wages are FAR from the ONLY factor in pricing.

            This is one store in a boom town where labor is scarce. You can’t draw a general conclusion about prices and wages in general from that one example. That store is doing an huge volume of business, so revenue per employee is higher than at most other Walmart stores, and are able to pay employees more. That wouldn’t be true at every Walmart, or every business in general, in other areas of the country.

            You haven’t discovered a new economic truth.

            So you debunk the Claim that without minimum wage companies will pay next to nothing

            Yes he did. As you can see from this example the market will determine the wage necessary to attract and keep workers. In Williston that wage is at least $15/hr. Other parts of the country have different market minimum wage rates, no doubt much lower, but it isn’t “next to nothing”, as no one will work for less than some amount they find acceptable.

      3. Steve H

        Profits come as WalMart is the only place to shop…

    3. No, prices at the Williston Walmart were no different than any other Walmart… Prices for produce and milk, etc. were the same as Walmarts in other areas….

      1. Joe Bannister

        Really?

        But if the minimum wage in Williston is $17 and hour….would make sense to mark things up…unless there are a variety of large budget retailers nearby…

        1. toochrispy

          Take a look at Williston Walmart’s flyers. You’ll notice that prices are pretty much the same across other locations around the country.

          Minimum wage in Williston is not $17/hr. Walmart is offering jobs around that price. This is an important distinction because it shows us that their higher wages are a result of market driven decisions and not a reaction to government policy.

          Keep in mind that Walmart can stay profitable because of high level of the sales. Additionally, utilities costs in North Dakota are very low, helping offset higher wages. Besides, Walmart damages their low-cost-goods-provider-brand by raising prices. There’s no reason to mark anything up.

  10. marmico

    Comment removed.

    1. toochrispy

      Even with a log scale, the chart shows a positively sloped linear trend. Annual domestic oil production growth since 2011 ranges from 10% to 19%. The numbers indicate that the shale boom is ongoing. What chart are you looking at?

  11. Mita Pogue

    If you take a look around the Walmart there, please make note of the average age of the workers there. If there are a lot of younger workers you can bet a lot of them are single and/or attending high school or college, and possibly still living at home. Also, those who aren’t single will likely have a family where there is more than one wage earner. Also, lots of people use Walmart as a second or retirement side job.

  12. Steven Bailey

    Lots of employees at Williston Walmart are international.
    60 hours on up is standard here. Can’t hire enough people to meet staffing needs? Overtime. Prices are not higher.
    Volume off the charts. Employers with some type of housing assistance have a leg up in a city where every bedroom is full. I work 70 hours a week, $50/hr as a building contractor. Live in an extended stay hotel at $1300
    a month. Housing demand huge. Happy building.

  13. I like how half the people on this page talk about living in North Dakota and how much it cost but in fact really don’t know anything.

    1. That’s what I was thinking… 8 years ago, my brother rented a decent, 2 bedroom apartment for less than $300 a month. That apartment is over $2000 a month now. Even a parking spot for an RV will cost you a grand in some places!

      Home sweet home isn’t very welcoming for those who went to college and wanted to return. I know a lot of schoolmates who either moved back in with parents or never came back even though they wanted to.

    2. I know I live in Texas and our local Walmart pays minimum wage. I work at the Walmart Distribution Center and make 17.90 an hour. Been there for 6 yrs and I’ve never heard of the stores EVER paying that much…Ever!!!!! I’ve been all over the country training and all the DC’s pay just about the same. I’m seriously questioning this…..The DC’s wages are always more than the stores.

      1. Joy

        Where is the DC for Williston? Is rent high in that location? Is there overwhelming demand for everything like there is in Williston? What are store workers paid in that location?

  14. http://s23.postimg.org/3pzx8fpkb/Untitled.png

    In the Seattle labor market, an increase in the minimum wage pushes the price of labor from P to P*, creating a surplus quantity of labor supplied. The quantity of labor demanded however
    pushes the equilibrium quantity of labor exchanged from Q back to Q*.

    Employeers lose consumer surpluses equal to A & C of which A is a deadweight loss, and C is gained by employees who retain their jobs and recieve a higher wage. D is a dead weight loss to employees who cannot sell their labor at a cheaper rate but are not demanded at the higher rate, and B and E are producer and consumer surpluses that do not change with a price change,respectively.

    Producer surplus is equal to B+C-D and Consumer surplus is equal to E-C-A.

    In the Bakken labor market, the oil boom shifts out the demand curve for labor. Labor supplied partially expands to meet the demand, but not by enough to keep wages from climbing from P to P*. The outward shifting of both demand and supply curves expands
    quantity from Q to Q*.

    Bakken Employees gain producer surpluses from areas A, B, C,and D; they capture E from employeers and retain F before the shifts in demand and supply.

    Bakken Employeers gain consumer surplus from H, while retaining G and losing E.

    Producer surplus is equal to A+B+C+D+E+F and consumer surplus is equal to G+H-E.

    There are no deadweight losses in the Bakken labor market.

    Wages to workers in both markets have increased, increasing disposable income that can be spent on things like housing. In Seattle however, these gains are concentrated among fewer people, and firms also have less resources to invest into creating future employment opportunities as compared to Bakken firms because of large deadweight losses and income transfers.

    In the Bakken, the dispursed gains also means more people competing for housing, driving up housing prices, but it also means more people have money to spend on housing, whereas in Seattle you have more people not driving up prices, but also more suseptible to being broke & homeless.

    1. Firms don’t decide their optimum labor force based on the supply or demand of labor. They also determine it based on the marginal revenue product from each new hire and the marginal cost for adding that new hire. Your graph for Seattle assumes it’s already at equilibrium and is perfectly competitive. In many cases around the country, an increase in the wage would actually increase the labor force as it shifts the point of maximizing the company’s profits further down the MRP curve until the new wage and the new labor force actually meet at the point of equilibrium between the supply of labor and the demand for labor. This would reduce rather than produce dead weight.

  15. Edward Gerhardstein

    Your conclusions are flawed.
    1. If walmart can afford to pay there employees 2.5 times the minimum wage in Williston, ND then can afford to pay their employee 2.5 times the minimum wage everywhere. Walmart in business to make money if they weren’t making money in Williston, ND they wouldn’t open a store in Williston, ND.
    2. It also proves that $15 per hour “living wage” could work everywhere. It proves the the market up in Walmart product can sustain $15 per hour “living wage” and that other companies like Walmart can sustain a $15 per hour “living wage”. In Williston, ND they would still be paying more than $15 per hour because the market call for it.
    3. No body in the United State would be call for a $15 per hour “living wage” if everyone was making 2.5 times the minimum wage. The problem is that companies are out to make the biggest profit margin that they can get and there is nothing wrong with that, but it is usually at the cost of the employees.

    1. toochrispy

      The Williston Walmart generates high levels sales so it can afford to pay higher wages at that location. You can’t use this situation to assume that all other Walmart locations can generate the same level of revenue as the Williston location, sustain a $17/hr wage for employees and maintain profitability.

      1. Agreed. They can’t keep shelves stocked at with Williston Walmart. It’s not their fault. The shelves get cleared so quickly– especially sales or clearance. Also, quite often they have boxes running down the center of the aisle and people just pull items right out of the shipping box! In all fairness, though, the last time I went I didn’t encounter boxes in the aisles. Walmart is always packed, and you will stand in line forever. I know a lot of people who will drive 125 miles, or 2 hours, to Miles City Walmart rather than 30 miles to Williston.

    2. Edward

      1. If walmart can afford to pay there employees 2.5 times the minimum wage in Williston, ND then can afford to pay their employee 2.5 times the minimum wage everywhere.

      No they can’t. The Williston Walmart has the highest volume of sales in the US at the moment. That means revenue dollars per employee is high and they can afford to pay more than elsewhere, in fact they MUST pay more in that high cost of living location to attract anyone at all.

      You can determine for yourself roughly how much Walmart earns per employee using the numbers in the Forbes 500 list of companies.

      Walmart in business to make money if they weren’t making money in Williston, ND they wouldn’t open a store in Williston, ND.

      That’s correct. They’re making money on volume.

      2. It also proves that $15 per hour “living wage” could work everywhere.

      No it doesn’t for the same reason explained above.

      It proves the the market up in Walmart product can sustain $15 per hour “living wage” and that other companies like Walmart can sustain a $15 per hour “living wage”.

      No it doesn’t. Almost everything in Williston has a higher price these days due to the economic laws of supply and demand. You can’t use those high numbers everywhere in the US.

      In Williston, ND they would still be paying more than $15 per hour because the market call for it.

      There’s the magic word – *market*. The *market* determines the cost of labor in Williston and everywhere else, and that cost varies a great deal within the US. An arbitrary price like $7.25 or $15 or any other number imposed on employers everywhere creates unequal treatment based on where workers live. The market, on the other hand, can determine the correct minimum wage everywhere.

      3. No body in the United State would be call for a $15 per hour “living wage”if everyone was making 2.5 times the minimum wage.

      That “living wage” thingy is a hard to define concept. What does “living wage” really mean? It means different things to different people, in different geographic locations, at different times. There is no standard definition, and no one number can be considered a living wage.

      Then, of course, we need to consider that the price of labor is determined by the value an employee produces for their employer. For example an employer can’t pay a worker $15/hr for $10/hr in value received, so those who can only produce $10.hr for an employer will remain unemployed. The minimum wage does that to people in some market. It forbids them to work at the value of their labor.

      The problem is that companies are out to make the biggest profit margin that they can get and there is nothing wrong with that, but it is usually at the cost of the employees.

      You’re right. There’s nothing wrong with that. Shall we assume that workers AREN’T out to get the highest price they can get in exchange for their skills and labor?

  16. @morganovich…Correction: Minot is 125 miles away. Quite a commute.

  17. As with all things in a free market society, “What the market will bear.” The problem though, the economy stinks in most of the country, so does the wages. The other problem, our industrial base has been shipped overseas and was attempted to be restarted through the service type industries. Almost a complete failure. Now what? It’s not just about minimum wages, it’s about putting our economic system growing again and re-educate our corporate leaders that the bottom line is not the only responsibility they have. Previous corporate leaders, building our national economy understood this, not so much of the current bunch of so called leaders of industry today. Innovators and visionaries are what is needed in today’s corporate world, not just bean counters.

  18. What this sign really demonstrates, when you give the context of what rent costs in Williston, is that even in areas of low unemployment, Wal-Mart still doesn’t pay a living wage.

  19. Tim Jacobs

    My brain hurts just from trying to read this piece of trash. How can anyone really think this way. Please tell me. And if you do you are a fool.

  20. I had heard once that the majority of the oil extracted anywhere in the U.S. is being sold to China and other foreign countries. Is that true? While exporting can be a good thing, I’d be for a national embargo on exporting of oil if it meant those numbers would change in my favor on the signs at the gas station.

    1. toochrispy

      The United States already have an oil export embargo, which was instituted 40 years ago.

      Although we are allowed to export distillates, such as gasoline, very little goes to China.

      http://www.eia.gov/dnav/pet/PET_MOVE_EXPC_A_EPD0_EEX_MBBLPD_A.htm

      I think your source is incorrect.

  21. I suspect though, that even at over $17/hour the people making these wages still struggle to put food on the table and not live in “the bad part of town”. Wages like this at Walmart typically indicate an outrageous cost of living.
    I agree with the theory behind this story, that a national minimum wage does not reflect the economy in every city or town across the country. That is true.
    The minimum wage in every city/town needs to reflect the cost of living in that area.
    A living wage is enough for every person or family to rent an apartment in a good part of town, put food on the table, provide clothes and school supplies for the kids and catch the bus to work in the morning.
    Any person that works full time, regardless of the skill involved in the job, should be able to live decently. There should be no such thing as “working poor”. If you’re working you don’t deserve to be poor.

    1. hitssquad

      @Minnie
      > If you’re working you don’t deserve to be poor.

      What about the “disabled”? They “deserve to be poor”?

    2. toochrispy

      “A living wage is enough for every person or family to rent an apartment in a good part of town, put food on the table, provide clothes and school supplies for the kids and catch the bus to work in the morning.”

      Let’s say we institute a living wage. What do you think businesses will do when they are faced with higher cost for labor?

    3. Minnie

      The minimum wage in every city/town needs to reflect the cost of living in that area.

      Yes, and the market decides exactly what that minimum wage is in each city/town. If the arbitrary, one-size-fits-all number politicians pull out of their backsides is higher than that, people will remain unemployed. If it’s lower, it has no effect on wages and is meaningless.

  22. Dakota-Joe

    Interesting to hear how things are in Williston from people that have never been there. The closest town of any size is Sidney, MT, with a population of about 5300 people. There are literally no farms, shacks or anything else affordable to rent within 1-1/2 hours of Williston. The infrastructure (water/sewer, electricity) in rural areas has not caught up with demand, causing a lack of housing to be built until the infrastructure is in place (water treatment plants, telephone service, power grid). Living in a trailer without plumbing or electricity in 30 below zero is not that fantastic. Minot, ND is 2 hours away, but has nothing affordable to rent, either, since much of the city was damaged by a flood a few years ago and hasn’t completely rebuilt. Todd and Grant have it right! Due to mineral rights, most landowners have no real interest in renting their chicken coops or barns at an affordable rate. It’s not a great place to raise a family, but works OK for oil riggers that want to make a bunch of money for a couple years, live in a man camp while they are there, then bail when they’ve had enough.

    Advertised items are the same price at the Walmart in Williston as most other Walmarts, but they do make it up on their unadvertised items. Not ridiculously inflated, but higher prices than Minot or Grand Forks.

  23. “Walmart pays wages that reflect the economic conditions in a local market based on the supply and demand realities of the local labor market.”

    Agreed. Boom/Bust economics at its best. Interesting that somebody would use what amounts to a short-lived economic bubble fueled by cheap credit to bad-mouth minimum wage laws.

    This “miracle” taking place in North Dakota is anything but.

    As of March of this year there were 10,080 wells producing at an average of 97 barrels per day per well.

    Even without knowing how much Saudi Arabia produces that doesn’t sound like much but lets compare…

    In 2005 Saudi Arabia had 1923 wells producing at an average of 5,740 barrels per day per well.

    Only the thinnest and flimsiest of marketing ploys can even begin to compare these two oil patches and label them similar.

    The very best wells in North Dakota produce an almost irrelevant amount of oil over their lifetime.

    It is unlikely that a single tight oil well will produce even 1,000,000 barrels over its alleged 45 year lifetime but lets assume that is the average.

    If that assumption holds then each ($10,000,000.00) well produces about 9 minutes worth of oil at current rates of global consumption.

    It is no wonder this is being called The Shale Bubble.

  24. If the daily amount of oil is just now approaching one million barrels a day, how is it possible that one billion barrels have already come out of Bakken? One million days ago is over 2700 years in the past. Where are you getting this data?

    1. One billion is the accumulated oil production in the history of the Bakken, going back to the 1950s. The one billion barrel milestone has been reported here on Carpe Diem, and in the news by Bloomberg, etc., it’s a well-established fact.

      1. Gotcha. My maths are a bit off when I first wake up hahaha. Thanks.

        1. Your englishes are a bit off, too.

          1. There is nothing wrong with his English. In the UK, it is spoken as “maths”. In American English we say “math”. Either way is appropriate… Please refrain from spreading your ignorance in the future. Thank you.

          2. How do you become an adult without knowing that people from England people refer to mathematics as “Maths?” I’m genuinely curious. Which rock do you live under?

          3. Maths is the across-the-pond abbreviation for mathematicS. Technically correct, even if it does sound silly to American ears.

          4. Logic Punch

            What’s wrong with his English?

          5. @Ron, apparently, it depends on what country you’re from as to whether you say math or maths.

          6. “maths” is the way the used is used in England. It’s used differently in America.

          7. David R

            Ron, actually you’re in the minority. Most English speaking countries use the term “maths”. Americans incorrectly use the singular form “math” even though they also use the plural “mathematics”.

          8. Not necessarily. Maths is just as proper as Math.

          9. whistler

            The word “mathematics” is not plural. The “s” is not a marker of a plural in this case, just like the word “basis” is not a plural.

            “Math” appeared in 1890. “Maths” appeared in 1911.

            In this case, Americans are not only using the more correct form, they are using the earliest form.

            The British, however, are much more logical when it comes to the position of periods and commas relative to quotation marks, and I follow the British punctuation rules.

          10. David R

            “Math” may be older, but it is still an incorrect Americanism. And mathematics is indeed the neuter plural, derived from -ikos used in adjectives.

          11. I just wanted to say, who cares? You’re all off subject. But it could be my math and english are wrong.

      2. JJ Thomas

        Wow do I contact for a oil job

        1. Curious

          Yeah I’ld like to know that too. Can you apply on line without making the huge drive just to find out that now that there has been publicity, all the jobs are gone.

    2. Tim Johns

      Because a Billion is 1,000 million not 1,000,000 million

    3. um, 1 Billion is 1000 Billion, or roughly 1000 days or just about 3 years ago. Math, do some.

      1. I mean 1 Billion is 1000 Million. I can’t edit.

    4. lowcountryjoe

      One billion is only 1000 million. 1000 days ago is less than three years ago.

    5. A million barrels a day for 2700 years would be about a trillion, not a billion. At a million barrels a day, it would take less than 3 years to reach a billion.

      Where did you learn math?

    6. mmm ok, fact is it would take 1000 days of 1 million barrels to reach 1 billion. not 1 million days. duh!!!

  25. To rent a room in a house is $1000/month, to buy a Big Mac meal it $16! The cost of living is inflated due only to greedy people/businesses taking from those that are up there working. Many that are working the fields live in other states and have gone to earn a better living for their families back home. But the locals have seen a way to cash in and force the oil field workers to share a large portion of their earnings with them.

    1. givemefreedom

      Boss, your comments clearly display your complete lack of any economic understanding. Trying reading some books on economics before commenting on an economic blog.

      BTW, if the people/business who supply goods and services in Wiliston are greedy when they charge higher prices than are charged in other places, then why are the workers who go to Wiliston and charge higher prices for their labor not also greedy?

      1. Ceallaigh

        Really?
        givemefreedom comments: “Trying reading some books on economics before commenting on an economic blog.”

        “Trying reading some books” ….. really…. givemefreedom; your intelligent grasp of the English language lends huge credibility to the content of your comments. Try “Engrish”.

        Bottom line is this: when one sector of the economy gets healthy all other sectors prosper. Too bad you cannot see that simple fact in life.

        1. givemefreedom

          Ceallaigh,

          Autocorrect causes some strange things sometimes. No edit function is also a problem.

          So instead of seeing the obvious and assuming a typo, you jump all over a meaningless error and attack me personally. Well done, that really helps your credibility.

          You continue to highlight your ignorance by making a comment that has nothing to do with my post or the post by Boss.

          Perhaps you have been trying to read a book on ecomonics and you are having a tough time of it. Maybe you should just refrain from posting here. Just keep reading until you have some basic understanding of what is being discussed.

          More likely, you are Boss and did not have the strength of character to defend your stupid comments and so you posted under a new name.

          Either way, GFY.

    2. Boss

      The cost of living is inflated due only to greedy people/businesses taking from those that are up there working.

      People will try to get the highest price they can, based on what others are willing to pay. That’s called human nature, and we all do it. People who move to Williston to work are responding to the same desire to get a higher price for their labor.

      Known as the law of supply and demand, when something is in short supply, as almost everything is in Williston, the higher price signals suppliers to provide more of whatever, and consumers to demand less of whatever, until supply and demand approach equilibrium.

      The study of these human interactions and their interrelationships is called “economics”.

      Many that are working the fields live in other states and have gone to earn a better living for their families back home.

      Yes, they are seeking the highest price for their labor.

      But the locals have seen a way to cash in and force the oil field workers to share a large portion of their earnings with them.

      And you see something wrong with that? Can we assume that all the workers have come to Williston voluntarily?

      “Spread the wealth”, as they say. Would you prefer a government redistribution system?

      1. Listening to a liberal talk about economics is like watching a cat do calculus.

        1. I think we can all agree that there’s some pretty crappy economics being practiced in this thread, much of it by people who don’t claim to be experts.

          The original post that has started it all, written by an economics professor no less, claims that the hiring practices of one Wal-Mart in the middle of an oil boom is economic evidence of the need for a major change in U.S. policy that’s been in effect for 70–plus years.

          The minimum wage has been in effect in the U.S. since the 1930s, and during that time the U.S. became the world’s strongest economy. Is that because of the minimum wage? No, probably not. But the minimum wage hasn’t had nearly the negative effects that many conservative economists fear, either.

          There’s little evidence a pure free market free-for-all would work, except in the fantasies of some conservative economists.

      2. so lets see… minimum wage is over $15.00 but a Big Mac meal should still be only $5.00??? the $5.00 Big Mac meal is based on paying wages closer to $7 per hour not twice that just for an UNSKILLED burger flipper.. and what all is included in the cost of the Big Mac Meal?.. the labor costs of the burger flipper, the cashier, the shift manager, the fry maker, the janitor, the store manager, the janitor, the the delivery truck,, the insurance, the heat source for the grill and fry vat and soda cooler, not to mention the cost of the perishables and the paper goods, the accountant, the payroll specialists, oh and of course something for the GREEDY OWNER .. did I forget to mention the TAXES that in most states are roughly equivalent to 35% of the employees paid wages…

    3. ken swan

      Obviously you were not around when they were building the Alaska Pipeline then, Money was really good (when a dollar was closer to being worth a dollar) and prices were on par with what people were making ( try $10 for a loaf of bread) and this was in the ’70′s

    4. Cowgirlongreen

      Boss, you missed the whole point of the blog, you do realize that if they are paying someone $15.00 an hour to make you your Big Mac, you can’t expect to still pay $5.00 for it! When the wages go up to cost around you is going to go up! It’s not people being greedy, it’s people surviving! The locals are struggling trying to find a place for all these workers, trying to provide them with housing, groceries and clothing! Knowing in the end, WHEN THE BOOM IS OVER, they will be setting with all this housing, schools and businesses with no one to support it!

  26. Ushuaia Wolfheart

    “If Walmart offered the minimum wage of $7.25 per hour in the Bakken area, it wouldn’t be able to staff its stores.”

    The minimum wage is just that, the minimum. Market conditions and other factors will always play into wages. Setting a minimum wage has absolutely nothing to do with whether or not a business will be able to find workers, it instead sets it as a baseline from which they cannot pay less. If your business cannot pay its workers the minimum wage then you do not have a viable business. It would be no different than if your business could not afford to make a profit because the components are too expensive. Labor is just another component in the business model.

    “2. The fact that Walmart is paying almost 2.5 times the minimum wage in Williston, ND is evidence that a single, national minimum wage for every city, county, labor market in the country can’t possibly make sense. Even proponents of the minimum wage have to agree that a single national minimum can’t be optimal for every labor market in the country. In that case, they would logically have to support thousands of minimum wages tailored to thousands of local communities, or maybe even more logically agree that minimum wages are unworkable.”

    Your conclusion is again based off of flawed thinking. You are using a outlier in the data to try to give your argument weight. This is an extreme case. Yes Walmart might have to pay 2.5 times the normal starting wages for its stores in order to find workers, but doing so does not mean that nationally the minimum wage is impractical. Just because Walmart is not offering the minimum wage in this instance does not mean it is not having an effect. Minimum wages offer a insurance to the worker that he/she cannot be paid less than a set amount, regardless of job market fluctuations. Just because you can pay minimum wage does not mean you cannot pay more.

    “3. You probably won’t be hearing anybody calling for a $15 per hour “living wage” in North Dakota, since the entry level wages at Walmarts there are already above that.”

    All Walmarts in North Dakota are not paying wages starting above $15/hr, only the Walmarts in that local vicinity would pay near that. The rest of the state would be closer to the average pay at other Walmarts. Again you cannot use an outlier in data to make blanket assumptions.

    “The energy sector is the strongest sector of the US economy, and is bringing wealth, prosperity, and high-paying jobs to places like western North Dakota and south-central and western Texas.”

    This might be true, however the energy sector is also facing one of the greatest crisis in its entire existence. The oil supplies are running out and the viability of current supply keeping up with demands is going to force painful changes that will have strong ripple effects throughout all global economies. Once the “easy” energy is consumed then serious efforts with diminishing returns will have to be employed to maintain our current levels of consumption. When the oil and gas industries start having to cut production costs, the first place they will do it is labor.

    “President Obama decided to visit the Standing Rock Sioux Indian Reservation about 250 miles from here in the southern part of the state, where the jobless rate is 86%. Go figure.”

    Yes what a shame the president actually goes where the local people need his help ” Instead of visiting the most prosperous part of the most prosperous state in the nation to recognize one of the most powerful engines of the US economy”.

    “When Obama lectures the Native Americans this Friday about jobs and economic development in their part of North Dakota, perhaps he should mention that there’s a labor shortage only a few hundred miles away, with hundreds, if not thousands of immediate openings for high-paying jobs in the oil patch.”

    If he did this then you would see a mass migration of workers to that area, far above and beyond what that local market could support. This would drive down wages and normalize it with wages from the rest of the state. Then you would again see a need for the minimum wage in the area, otherwise wages would fall to below minimum wage.

    1. “If your business cannot pay its workers the minimum wage then you do not have a viable business.”

      Well, not really, at least not in today’s world-market. There are very few jobs that cannot be outsourced at this point, and if you cannot pay the US minimum wage, you can still find people in Thailand or Romania who will gladly work for less than that, do just as good a job, and be very happy with the $2-3/hour that they receive in return. Suddenly, your business is viable again.

      All the minimum wage does is force American companies to price themselves out of the (world) market, which is one reason (maybe the main reason, although taxes play a strong role as well) why there has been such a business drain from the US in the past few years.

      Also,

      “This might be true, however the energy sector is also facing one of the greatest crisis in its entire existence. The oil supplies are running out and the viability of current supply keeping up with demands is going to force painful changes that will have strong ripple effects throughout all global economies. Once the “easy” energy is consumed then serious efforts with diminishing returns will have to be employed to maintain our current levels of consumption. When the oil and gas industries start having to cut production costs, the first place they will do it is labor.”

      This argument (“peak oil”) was made back in the 70s during the Energy Crisis, with people predicting that there wouldn’t be any gas left 20 years down the road. Yet here we are, 40 years later, and there’s more traffic than ever. What changed? Technology. Cars became more efficient, drilling techniques were improved, yada yada. No reason to think that this won’t happen again, and continue to happen for as long as there’s a need to make less stretch into more.

      Other than those two items, I liked your post. :-)

    2. R Coots

      So. I don’t have the brain power this early in the morning to wrap my head around most of the topics here. I can however,speak to the one about the likely overflow of workers you mentioned if people from the nearby Res came over to work in the field.

      In a nutshell: They’d be a drop in the bucket. We have half of Idaho here (or very close). A good portion of Louisiana seems to have migrated on up. There are plates in the parking lots from every state in the union. Right now, MOST of the cashiers at Wal-Mart are from Africa. Not African-American. From Africa itself.
      There’s been an exchange program running off an on in this town for the past few years where a group of people from other countries come in and work for a few months in places like Wal-Mart, the fast food joints and grocery stories. If all those people are so willing to come so far for a job, don’t you think someone who’s only 250 miles away would have clued in by now?

      1. C. Rock

        In a nutshell, you’re crazy. Africa is not a country, it is a continent. LOL

        1. “Africa is not a country, it is a continent.” And your point? The writer may know of cashiers from several countries in Africa. Their point was that most of the cashiers are not from the U.S.A.

    3. Thank You Ushuaia Wolfheart for covering everything I was thinking!!

  27. Randy Smiley

    this is more than likely a part -time position meaning, Wal-Mart pays no medical, life or any other benefits. Also means that if you slash 17 in half as part-time, that is equivalent to 8.50 an hour as full-time, and thats assuming they allows one to work up to 39 hours as part time to even come close to a full-time check. Is wal-mart smart. Or are we just stupid..? This should have been a no brainer.

    1. Melissa

      Actually Walmart does offer benefits to all associates even part time

  28. Ritchie Williams

    Gallon of milk $12.95?

  29. shervonda tait

    I’m applying for a cashier’s postion!..

  30. Aaron Phillips

    “Daily oil production in the Bakken is approaching one million barrels per day.”
    No it’s not.

  31. I find author’s suggestions that Standing Rock Native Americans somehow maybe unaware of jobs in Williston really condescending…the issue here is not lack of jobs but proximity of housing the job….I know people who pay over 1000 dollars for bed in a crammed house and those are the lucky ones who were able to find housing. I think that better economic lesson to take away from the given data is that Walmart can infact make a huge profit even when it does not pay minimum wage.

    1. Amen!!

  32. I’m wondering if the Walmart employees make that much are the prices at that Walmart higher as well? The reason I ask is even at those wages can you live off that income at the supposed inflated costs any better than a walmart employee anywhere else?

  33. Interesting blog. Why would the people on the reservations care? They are heavily subsidized to live there. Our government feeds their need for reparations not their human spirit to thrive. And so they sit in self loathing and depression. Much like a spoiled kid never asked to work for his car – inevitably he’ll crash it.

  34. To disagree with what everyone is saying about the minimum wage paid according to the economics of individual states.Walmart is paying upwards of 10.00 per hour in ND.I live in GA my wife works at Walmart she makes 10.40 per hour which is above minimum wage and relatively good pay for that line of work in GA.My argument would be with Walmart themselves and not the pay rate.No one other then managers are full time at walmart no one makes 40 hours per week so what does it matter if your making 17.00 per hour or 10.00 per hour according to each states economy and rate of pay if you cant get a full time status you cant make it on the part time pay.So walmart with thei poster of upward 17.00 per hour hiring pay is bs and they can blow that smoke up someone elses ass.My wife averages 16-32 hours per week you do the math on her pay after deductions of fed tax state tax social security and paying her own insurance.Why do you think there are marches on walmart ceo and walk outs in there stores its not because of the wages its the hours and treatment the employees get

    1. Here in Colorado, the strikers are 99% union members, and a few paid protestors. Next time you see a group striking, go over and ask them how many actually work at Walmart. No one forces them to work there? On most days, there is not one actually Walmart employee in the group. Ask your wife!

  35. So for people to have a chance at getting above poverty level it’s ok to just inflate pricing and wages? The GOP wants trickle-down economics… So the oil well made the oil company rich, and so the solution is to raise wages and double prices of commodities? This is some kind of trickle down. (The oil company makes their billions, then watch the workers have to spend more to survive but the oil company is not going to budge).. This is like what the mexicans do at the borders. They cross the border to make a few dollars which means much more back in their country, then they take the money and go back to mexico. Meanwhile other people in this town who work at a normal job find themselves trying to cope with a cost increase that is so far out of proprotion they can’t afford to eat a mcdonalds cheeseburger.????? The government and big corporations win.. That’s the only thing this produces.

    1. Absolutely!!

  36. There should be no minimum like there should be no maximum, I suppose. Forget economics I’ll give you a concept your parents should have instilled years ago, sharing. There is more than enough wealth to go around but no one wants to take a cut so others can prosper. One person from the to taking a pay cut they more than can afford could raise the wage of every low or entry level employee.

    1. Walmart Surely Can!!

  37. M Bryan

    I doubt that this is true….

  38. Rather ridiculous to attack a guy regarding the fact he did not know “maths” was proper Brit English. I’ve travelled throughout Europe and some in the Middle East and studied 3 foreign languages but never heard “maths” before, albeit I did not spend much time in the UK. I hardly think I live under a rock though.

  39. What they mean to say is everyone in that area is making so much money that no one is going to come work for our shitty walmart wages but we have to have a walmart there because we are taking over so I guess we are forced to raise our wages. Damn I guess we will lose a few thousand off our trillion dollars we make every year

  40. Bull shit! Where is this store? What’s the store #?

  41. In other words “You should be allowed to pay whatever you’re able to get away with paying”

    Here, unemployment is below 1% so we have to pay high wages HOWEVER, if unemployment is extremely high we should be able to throw whatever pittance we want at our workers! If people were willing to work for a dollar, we should be allowed to pay that as we keep billions.

    Seams reasonable to me!

  42. johnrobert

    Point #2 is what sticks in my craw. “The fact that Walmart is paying almost 2.5 times the minimum wage in Williston, ND is evidence that a single, national minimum wage for every city, county, labor market in the country can’t possibly make sense.”

    Rightwing economists are always proving that things which have worked for decades can’t possibly work. We have had a Federal minimum wage since 1938. Just as a matter of simple, historical fact, it would seem clear that a Federal miminum wage has not destroyed or even noticeably slowed down the American economy.

    Corporations like Walmart, which combine the capital of tens of thousands of people, always have a negotiating advantage over individual workers. We could level the playing field by letting workers combine into unions to increase their negotiating power with corporations, but the rightwing always freaks out about combinations of labor rather than combinations of capital. So in the absence of unions, a minimum wage is a very sloppy and crude, but not useless, way of countering the negotiating advantage of capital over labor. Myself, I would prefer really high marginal tax rates, but if we can’t get that then hiking the minimum wage is the second-best solution.

    And before anyone jumps in to remind me of the high wages Walmart is paying in Williston, let’s just agree that Williston is an unusual case that shows us nothing about the rest of the economy. Outside of Williston, Walmart pays crap incomes that aren’t liveable without being supplemented by government assistance.

  43. John Ely

    People who advocate a minimum wage neither care about or understand basic economic principles. That is why they advocate a minimum wage. This article will be lost on them.

  44. dgatwood

    The federal minimum wage was never intended to be “a single national minimum”. It is intended to be a national “minimum minimum”. Lots of states and even some cities have minimum wage laws that set a higher minimum wage than the federal minimum, because the cost of living in those areas is higher than the national average. The only thing that states can’t do is set a minimum wage *lower* than the federal minimum.

  45. Sorry but alot of yall are wrong. I work in the oilfield. Wages in williston are aame as they are here in texas. But it doesnt cost $80 for a sweatshirt. Walmart is NOT paying ppl $17/hr either. The simple fact is the people of williston HATE make no mistake, they HATE the oilfield boom there. Yet all the businesses are charging more. Except Applebee’s. Their meal prices on menu are same there as they are here. So before yall talk out your ass how bout u do a little research or ask someone that has been there.
    That is All

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