Individuals are smart enough to earn employers a profit, they are smart enough to earn a living wage.
A living wage first, profits second.
Solution: Creation of Underemployment Tax and Unemployment Vouchers
Instead of unemployment checks, unemployment vouchers. Companies who choose to hire a vouchered employee receive a reduction in their underemployment tax. The underemployment tax will calculate the total dollar amount of individuals underemployed. Underemployed individuals are those earning less then a living wage, on a per hour basis. The underemployment amount will be used in conjunction with the employment income (gross income – number of employees x living wage) of businesses to determine their underemployment tax.
Example: Joe’s deli employment income 20k, Tom’s Oil Co’s employment income 300m while Megamart’s employment income 15.4b . Total underemployment amount totaling 1b.
Underemployment Tax: determined by calculating total employment income of all employers, dividing individual employment income of each employer by the total which returns their percent of underemployment income. That percent is their underemployment tax rate. Times that percent by the total underemployment amount and that is their underemployment tax due.
Employer—-Employment Income—Underemployement Tax Rate—–Underemployement Tax
Those who hire receive a lower underemployment tax and a higher production capacity. Else, they receive the benefit of their tax dollars adding to the overall production capacity of our nation. It’s a win, win!