Labor shortage or terrible jobs?
annehelen.substack.com
annehelen.substack.com
A 10% profit is very modest. That's not the story of the "fat cats getting rich on the back of the workers" that the article is alluding to.
The problem for the business is that the financial model is set by the fixed or imperative costs, i.e. the cost of rent, the cost of maintaining the capital equipment, the cost of cleaning to meet codes, insurance, etc. The cost of labor, for cooks, wait staff, etc. is often the biggest part of the expense budget for restaurants.
With such a small profit margin, arbitrarily raising everyone's wages is likely going to kill the business. There is no room in the budget. The only choice is to either automate, which will reduce the labor requirements, or raise prices and hope that customers won't just go down the street. But they will, they will go down the street--until everyone's prices go up and there is nowhere else to go. And all of this is free market capitalism at work. It is a continuous process of reinvention.
In short, I'm not saying that higher wages aren't necessary, I'm just saying that both sides of the equation need to be examined, i.e. the plight of the worker AND the plight of the business. And we need to understand that things will probably get ugly before they get better. Because that's how capitalism and free market economies work.
But watch out for technology and automation...that is the part of the equation that has been "solving" the labor problem for some time now...
My point isn't to say there's anything wrong with that model: more power to anyone who comes up with a creative, legal way to make a living. Mainly I just want to point out that you often can't look at it simply as making X% margin on sales in a given period of time or any other single metric for many businesses as the real gain is longer term than that.
Which is really a long-winded way of saying: if the ability of a business to make a long term profit is not my concern, their claimed inability to pay a living wage isn't either. If they honestly can't afford to pay a living wage, then as the article states, perhaps it shouldn't be in business. If there is a market for whatever product/service they were offering, someone will come up with a sustainable way to serve it that is better for all involved.
In my old neighborhood there were always a few empty places because they were pricing people out, and few wanted to pay the new prices.
It's not logical to kill businesses by arbitrarily raising the minimum wage. Do you think the people they employ are better off not working at all? These people may not have a decent enough salary, but they get to work as opposed to staying at home and degenerate (mentally and physically). I always thought the better solution is to help them financially in other ways (greater tax credits, negative taxes?).
There are plenty of things society needs done to keep displaced workers productive (with better pay and a sense of actual accomplishment) while giving them breathing room to figure out 'what next?' I don't believe for a second that we're doing workers in the sub-basement of the economy any favors by keeping them locked down there. It isn't a binary (either they work in these crap jobs or they sit at home and deteriorate) decision... there are a variety of options between the extremes.
[1] I'm suspicious of the majority of cases where this claim is made. A rational business person would see that such a business is already marginal and that they would likely be better off shutting it down and redeploying the capital elsewhere for a better return. This happens all the time. If the owner can't see this, keeping the business on life support isn't doing anyone any favors.
Maybe it is worthwhile killing some businesses, and pushing some people to get new jobs or to live on benefits, if the wage increase for others is a greater benefit to society.
Its also worth noting that practically no businesses close when minimum wages have been increased in the past. People suggest its a problem,and logically it makes sense, but it doesn't seem to actually happen in practise.
If I don't have a job I go workout during the day, learn new skills, and read. Without kids that is, with kids I take care of the kids.
If you want to argue that the minimum wage increases unemployment, and that the unemployment tends to be long term, go ahead and argue.
But don’t ask us to take it as an article of faith.
Maybe you didn't read the article. but in summary, because the businesses are not paying enough, the businesses have less employees.
Its not that the employees wont have jobs, but they will just have a higher paying job somewhere else.
I'd call it a wrong conclusion to assume that the thing that people do to unwind after a busy workday or what people do who are unable to work due to depression is the same as what people undertake when they can sustain themselves without spending the majority of their waking hours commuting and working.
Also, I feel like this isn't even worth addressing, but no, work is not a government-sponsored day care for workers.
Otherwise said, these not ending is bad thing.
And none of that is for benefit of worker.
That's a disgusting thing to say.
I always wondered how restaurants even work - how can owners be motivated to keep themselves in this endless, poorly paid grind. In my opinion, when this is not about large chains that are effectively self-reproducing machines that don't depend on any people's motivation, it's mostly either hobbies (someone runs it to keep himself busy and feel beneficial to the society during retirement, for example), or just failures (someone foolishly believes there's a massive amount amount of money to make, gets burned, and vacates the space to leave it to the next one). Yours truly have been that sort of person in my younger years (when it was a lot easier, as industry professionals say!).
And yes, i can easily understand how can one become a dick being a restaurant owner. You deal with people who are paid poverty wages (there is no choice here), who can't be motivated with anything but threat of losing their jobs, have no work ethic (or they'd be doing something better), and in general can't be trusted in anything at all. You become paranoid and you quickly learn to disrespect people. I can feel that guy, don't judge him so heavily.
This is a hellish business to do and anyone who envies them is a fool.
As a cash business I often wonder how much laundering goes on. Not just hard core drug money, but any time cash is handled I suspect there's some rounding down going on.
McDonald’s model is pretty different from standard franchises.
Most are franchise owned and operated, but corporate owns the real-estate the store is sitting on.
It was examined. In 1944 in the Beverage Report "Full Employment in a Free Society". It concluded that people not earning sufficient to eat is an order of magnitude more harm than businesses not earning a profit and that the labour market should always be a sellers market, not a buyers market.
"But watch out for technology and automation...that is the part of the equation that has been "solving" the labor problem"
That's sort of the point. However micro-solving the labour problem with automation to drive forward productivity leaves you with a big problem - given wages are the primary source of demand, who are you going to sell the output of the robots to?
The underlying assumption here is always that the private sector provides the jobs. Look at the vacancies vs the number of people without work that want it. Then you'll realise that the private sector is systemically incapable of supplying sufficient jobs to go around. It always stops short. Which means that jobs have to be topped up by the public sector to ensure there are enough to go around.
If there are always 19 bones and 20 dogs, it doesn't matter how good the dogs are at bone hunting. Blaming the dogs for a bone shortage is desperately unfair.
to other people employing, manufacturing or investing in the robots
Gains in a society goes to those that are doing something useful to contribute to increase productivity, such as providing the labor that increases the productivity or providing the capital to make that increased productivity a reality. While they won't get the gains, bystanders to this process benefit from cheaper costs due to increased productivity.
I've only seen costs for stuff go up with inflation, and most people don't have wages that track inflation. The owners benefit from the cheaper costs, but nobody else does
This report is completely irrelevant in today’s America, where everyone has more than enough to eat, especially if they are working.
What are you talking about? Nearly 1 in 4 households experienced food insecurity during the pandemic.
https://www.npr.org/2020/09/27/912486921/food-insecurity-in-...
These business have a model that relies on poverty wages changing the minimum wage will disrupt these businesses greatly and I don't see a problem with that.
You can't keep a broken thing going because of the businesses that will have to change their model.
But sorry I also see your point there needs to be help to business to change their business.
Maintaining laws which force working employees into poverty in order to support inadequate business models is not the solution.
Employees outnumber business owners - more people having spending power is vital for the economy.
Maybe they have a slimmer margin over here, but they are still profitable. That implies that the model is (in principle) just alright, but there are financial flows that will have to change in the US. Of course you don't like to pay more for the labor you use to generate profit — ideally you wouldn't have to pay anyone at all!
If you can't run you business with minimum wage labor, maybe tou are not good at doing business and should change careers instead? Because many businesses in many nations have not the slightest issue doing just that.
Conceptually, I agree with what you're saying (I also feel very strongly about off shore manufacturing for the same reasons) but, practically, when you increase the minimum wage, the poverty jobs will disappear and _eventually_ be replaced. The problem is the transition period. The real minimum wage is always zero.
Labor is typically 20-30% of a restaurants costs, doubling that from say $9 to $18 would add another $2-3 to the price of a meal.
Doesn't that just end with bankrupt businesses and unemployed workers?
I do think employers should be conscious about the kinds of lives they set their employees up for, though we can talk about that without overgeneralization.
Good! I've been hearing about "the business side of the problem" my entire life -- lectured sternly about it, in many cases. All while few of the Adults and Experts - people with Real Power, in other words - dare even mention some of the topics laid out in the link.
> I'm just saying that both sides of the equation need to be examined, i.e. the plight of the worker AND the plight of the business.
There is no "plight of the business". There's a business that's making money, losing it, or breaking even. The people working there may feel the consequences, but a business cannot "suffer".
But you count the costs and it turns out you will break even in 50 years or if anything goes bad never, like, one bad hire will drown you.
You look at Google, Apple, Facebook stocks ... there is always a risk but no one got fired for buying IBM right? If you put your money in that stocks you don't have to worry about bad employees, sanitary inspections, paying rent, bad customers.
That is what those Adults and Experts are trying to tell you, local business is not some "magic" that makes money or loses it. Behind every local business with shitty jobs there are people, don't make every business equal to faceless Facebook, Google or Apple. Your local pizza shop has an owner who is as much an employee as his staff.
No. News sources are focusing on business instead of labor's issues, because news statistically favors business interests, not labor's.
If your hypothetical business owner is unable to start a business without paying a reasonable wage, then that business should not exist. And your hypothetical business owner should invest in Apple, Facebook, or otherwise.
If this causes less business entrepreneurship, then so be it. A business that cannot pay employees is not a business that adds value to society, and nothing of value is lost. This is a fundamental tenet of capitalism, the same way we say that businesses that cannot sell their product also deserve to fail.
This limit needs be adjusted, that’s all.
For a small business, the business and the owner can be practically one in the same. So in some cases I think that verbiage is pretty spot on.
Pretty sure a business can have plight.
Would you say that a rock suffers "misfortune" if it topples off a cliff into the sea? Is it "difficult" for a glacier to maintain its integrity in the face of global warming? Is my car unfortunate to have been scratched in a parking lot? (OK, I do believe that last one, but I'm anthropomorphising my car to talk about my own human misfortune)
It is also not free to give unemployment benefits, it requires higher taxation which moves the sustainability bar higher and more businesses close, etc etc.
They take on all the same risk as owners do
Jobs at more stable places are available and people will take them. The businesses need to fail or be sold.
The problem occurs in a few months when the bonus unemployment runs out. Then there will be millions more people looking for work. At that point, expanding employers will be able to hire at lower wages again. They’ll also be able to offer goods at lower prices. Employers who stepped up to pay higher wages won’t be able to compete. They’ll need to cut prices and cut wages or lay people off. That will be painful, which makes holding out until wages lower more attractive.
Employers can get around this by offering signing bonuses instead of higher wages, but they need to be large to compete with unemployment checks, and it may not make sense to do that for a few months of work.
These conditions may present a unique opportunity for policymakers to increase employment by raising the minimum wage.
Maybe this won't happen? Unemployment is officially at 6%. Better-capitalized firms have hired a ton of people over the last year. It's possible that marginal businesses like the weaker local restaurants mentioned in this thread will just have to adapt.
Besides, given that their jobs are apparently so crappy that they are losing employees to the likes of McDonalds, certainly they have high turnover. If a labor glut happens, they can just lower wages and deal with the resulting turnover, which they already know how to handle.
Minimum wage absolutely prices some people out of the job market.
Raising the minimum wage is unlikely to affect employment much because of just how profitable companies are today
Mind you I think a better tslternative to a specific minimum wage is to have a guaranteed government job at a specific wage. That sets a bar that all labourers have an option, while some lower paying jobs can still exist if they're otherwise competitive in other experiences
I always found the idea that restaurants need to compete on price strange. A typic Mexican restaurant is always going to lose to Taco Bell on that, so raising the price of your enchiladas or margaritas probably won’t have much impact on traffic.
We read a lot here about founders not setting prices high enough (see patio11 for tons of discussion). Or comment on backblaze being very hesitant to raise prices [0], but then buy into this idea that restaurants have set their prices optimally and that business will plummet if the $15 dish is suddenly $17. The truth is very few decisions on where to eat are driven by price (except at the high end) and instead are driven by experience and location.
There have been past minimum wage hikes, and that's not what has happened. The costs get passed onto consumers.
Of course, there's presumably some hypothetical minimum wage that would be too high and destroy the industry, but the amounts being discussed in the US are below what other countries have already tried.
Regarding this, from this[1] paper:
> Many business leaders fear that any increase in the minimum wage will be passed on to consumers through price increases thereby slowing spending and economic growth, but that may not be the case. New research shows that the pass-through effect on prices is fleeting and much smaller than previously thought.
> By looking at changes in restaurant food pricing during the period of 1978–2015, MacDonald and Nilsson find that prices rose by just 0.36 percent for every 10 percent increase in the minimum wage, which is only about half the size reported in previous studies. They also observe that small minimum wage increases do not lead to higher prices and may actually reduce prices. Furthermore, it is also possible that small minimum wage increases could lead to increased employment in low-wage labor market.
[1] https://www.upjohn.org/research-highlights/does-increasing-m...
But... why? To save a couple bucks on a burger? This is a serious question.
Is this really how consumer behavior works in the restaurant industry? Restaurant food isn't actually a commodity. A burger from one place can be quite different from a burger at another. Even at the low end -- I much prefer McD's to the other fast food joints. Atmospheres can be very different as well, even at the low end. Etc.
This is not at all how I behave. I have two local bars. I like both way more than all the other bars. I have one local brunch place I like way more than all the other brunch places. All 3 places can & have increased prices. In one case substantially. I go anyways.
Granted, I have more expendable income than the average American. But this is even how I behaved when I was on a pretty tight budget during grad school -- a few regular places and I went as much as I could within my budget.
Maybe I'm just a weirdo?
Yes. The data clearly shows the vast majority of the restaurant business be a low margin, high risk venture. That must mean a majority of the customers are very price sensitive.
I can easily afford to pay double and triple what most restaurants charge today. But I’m not going to pay it because I can easily make a meal at home of better quality for less, just have to add in my time and energy.
Moreover, I don’t trust restaurants to not cut corners most of the time due to the volatility of their business.
But that’s all personal preference. I suspect most people just have limited budgets, so increased prices means less times they go out.
I and my family each have price points in my head, once a restaurant charges more than that on the total line, we look for other options. $5 for good enough lunch, $10 for a great lunch, $20 for gourmet lunch, $20 for a great dinner, $40 for gourmet dinner.
[0] https://corporate.mcdonalds.com/content/dam/gwscorp/assets/i...
[1] https://www.macrotrends.net/stocks/charts/MCD/mcdonalds/numb...
Let's suppose some restaurants decide to raise prices. Customers decide to go to a place that's cheaper but... it is packed. Shortage, remember? Free market dictates that higher demand than supply makes the prices go up.
If client CAN go to a cheaper venue then we are not in a position of shortage.
In the end, look at places like Scandinavian countries: salaries are high and going to the restaurant is very expensive. When you think about it, being served by humans is actually a luxury and as global wealth progresses, this should become less and less common.
I really hope that the future of restaurants is either fully automated fast foods or high end luxury restaurants that people work out of passion, and that you can afford maybe oncee every months.
But watch out for technology and automation...that is the part of the equation that has been "solving" the labor problem for some time now...
Restaurant is a little bit convenience but mostly entertainment. If a robot is going to spit some stuff for you, why not buy an cheaper even microwave dinner, they're not that bad (or cook it yourself for something good tasting and which you can entertain yourself with).
%'s are a bad way to measure this, for that reason. Labor isn't even the majority of cost for restaurants (avg is apparently around 34% fully loaded [1]).
[1]https://totalfood.com/busting-restaurant-labor-cost-myth/
That's why governments created a minimum wage. If the salaries are written into law, there is no place down the street to go. That's also why environmental and hygienic regulations are so successful. Those things simply can not be done without government intervention.
https://assets.publishing.service.gov.uk/government/uploads/...
> This report includes the findings from a meta-analysis of the empirical UK national minimum wage literature. Similar to a previous UK minimum wage study by de Linde Leonard et al. (2014), this study finds no statistically significant aggregate adverse employment effect of the NMW and also no publication bias in the NMW literature. However, estimates for different sub-groups suggest some relatively larger adverse employment effects for some labour market groups, such as part-time employees.
The problem lies that the value of assets, especially housing etc, increase much faster than wages can catch up.
Rent for commercial spaces is set to what the market will bear, and that is also determined by the same financial models with labor prices as input. "Restaurant owners aren't getting rich off of exploiting labor; their landlord is" just means that the haircut should be getting taken off of the landlord's profit margins.
Now, this isn't a panacea - there are some distortionary effects from squeezing the rents that landlords can charge, and it favors high-skill and low-labor businesses by competing away higher bidders on commercial real estate, but it's not like business owners will feel 100% of the incidence of a minimum wage hike. Some will go out of business, which will lower commercial rents as vacancies rise, which will save a portion of the businesses that would die based off first-order effects alone.
This is my cynical approach... A right-to-center leaning person is in no position to argue "handouts are to blame", or "zoomers/millenials want it easy"... a truly right-to-center political commentary should be telling restaurant owners "Work smarter".
We have a decent minimum wage, social welfare, and hybrid socialised / private healthcare.
Increase wages and conditions gradually, businesses that can't innovate or charge more will fall by the wayside. That happens.
Which will drive away many customers who have become accustomed to cheap service built on "shit jobs."
At some point an equilibrium will be reached, the customers who can't or won't pay more will drop out of participation, and we'll have the true market for service built on good jobs.
No customer deserves cheap drinks and service built on shit jobs.
"Oh, but all those jobs will be lost."
They're already lost, the difference is that it's the workers making the decision.
This claim in particular was examined in studies on minimum wage increases, and found that increases in the minimum wage had no impact on the adoption of automation[1].
If people earn more, they can afford a bigger mortgage, so house prices rise.
She actually addressees this in the very last paragraph:
> if a business can’t pay a living wage, should it be a business?
If a businesa is in operation profitably it is because it is providing more value than if it were not, otherwise it would not be able to remain in business
If the government mandated that when you raise your prices, everyone else had to too, then suddenly increasing wages won't put you out of business! Same story if the government mandated that you raise your wages (in this particular hypothetical).
You're right that both sides of the equation need to be examined, but it's actually a bunch of equations with a bunch of sides.
this means your business is less efficient than your competitor's, or you are asking for a higher margin than your competitor. Both means that the business deservedly fail under the raised minimum wage.
if everybody has to raise their prices to fund the higher minimum wage, then it means the original minimun wage was already at the optimal level for your business!
In an ideal world full of law abiding citizens, yes.
In practice, restaurants that cheat are going to win.
I live in a country that has a lot of regulations in the hospitality sector and yet the "paid under the table, not officially employed here" phenomenon is everywhere.
This is why higher minimum wages are so important. They force all businesses (not just the ethical ones) to increase prices to point that workers receive a living wage.
Brings to mind the growing prevalance of self serve kiosk for placing an order that so many fast food restaurants have now. Removing the need for the cashier all together. That and self checkout at a lot of big chain retail stores. I don't think the business concern is necessarily with making a profit, but making 1% more profit than not.
What about profit sharing?
Hire an employee who agrees to get 1K currency units if company (store, resto etc) made 100K CUs.
But 500 if company made 50K CUs and 50K CUs if store made 5000K CUs.
There's always a max cap, but never a min cap. When someone talks about min caps we all get antsy.
There are maybe ten lunch places within walking distance of my (suburban) office.
The variety is nice, certainly. I like having a bunch of options. I don't think it would destroy society if I only had half the choices, though.
And the people you’re hiring won’t have to live off the dollar menu at fast food restaurants anymore.
Businesses need to raise prices. Some do and less people buy from them. Some can't make ends meet and close. Now the number of businesses is less. So, the number of open jobs is less. Potential employees now have a lower 'supply' of jobs. The wage for those jobs then falls. Somewhere in there, a new equilibrium is reached and everyone is unhappy for a while.
I'm not trying to discount the emotional pain that comes with this process. Putting your life into something that just blows up is hard. Especially when you had nothing to do with it. I feel for those owners, the situation is the opposite of fun.
But this is how capitalism works. The US is not a planned economy like China. Capitalism is core to the system (bastardized as it is). Markets change and shops close up. It sucks, but this is the process as I understand it. If I'm understanding it wrong, I would very much like to know because then I really am missing something big, and that's not good.
That’s not necessarily bad for workers. It might mean holding more than one job, which is common in the food business.
"The tendency of the rate of profit to fall (TRPF) is a hypothesis in the crisis theory of political economy, according to which the rate of profit—the ratio of the profit to the amount of invested capital—decreases over time. This hypothesis gained additional prominence from its discussion by Karl Marx in Chapter 13 of Capital, Volume III, but economists as diverse as Adam Smith, John Stuart Mill, David Ricardo and Stanley Jevons referred explicitly to the TRPF as an empirical phenomenon that demanded further theoretical explanation, although they differed on the reasons why the TRPF should necessarily occur."
Consider that if the rate of profit tends to fall, and shareholders require greater profits each quarter, how that affects "inputs" such as labor?
I agree with this sentiment. Mostly. But I can't say it freely, or with impunity - I'm on the lucky end of the spectrum partly by my own hard work, partly blind luck to be born in a middle class family, partly because my country has racial equality laws that give me the opportunity. I can negotiate my own terms for work and when I'm out of work I can freelance or build a product. But I can't swallow looking at workers as a line on an income statement. Something about it feels uncomfortable, uneasy. Like casually throwing talent and skills into the ocean when theres still so much work to do.
Sure, it's great for some. Most people in this forum are part of the economic and cognitive elite. I would expect words like automation to be thrown around freely because "optimization" and "free-market" are fantastic myths to belive in. They might even be self-fulfilling prophecies. They just never come up to help people get a leg up. Those families that could be paying taxes are going on welfare, which means we get taxed more but do we have a right to complain and try to dodge out of paying taxes to support the people we've put out of work for the sake of automation and progress? Would we be happy to automate to our hearts content if you had to pay more taxes?
Cities like Seattle raised their minimum wage, there was a lot of worry that everyone would go broke and there would be no food to eat. As it turned out, a few people shut down and someone else almost immediately opens a similar business in that place.
Not everyone runs a business that is properly priced, or properly managed to make a profit, but lots of people can do it, and they tend to fill the void that is left by businesses that can't offer a product that people feel is worth paying enough to support less than poverty wage.
Even for companies that pay really well, some don't make it.
The real drag on business and progress
I live in Missoula. I am a regular customer of Black Cat Bakery and I can see them struggling. In fact most restaurants and breweries I frequent face the same issue, a few employees desperately trying to keep an inundated ship afloat. I will tell you this article largely ignores what everyone who lives here understands is the biggest problem faced by laborers in Missoula at the moment. This city is amid a dire housing shortage, expedited by lack of new construction and a migration of buyers from more lucrative economies. The median home price increased by 57% in the last 10 years, 8.6% in the last year alone to $315k. In the meantime the median family income remains only $46k. https://missoulian.com/news/local/missoula-housing-prices-se...
It is truly a seller's dream market and as such the availability of rentals has evaporated. You'd be lucky to find a 1 bedroom right now.
My wife and I bought a home here a little over a year ago and were fortunate to find the nut who, "didn't need a realtor, what with craigslist." Before then we had been outbid 5 times previously, during which we offered up to 30k above the asking price. Frankly, we wouldn't live here if we didn't get lucky. Our experiences weren't unique at the time and it has only gotten worse. I regularly hear of houses selling for 50K over listing price to people buying sight-unseen.
Frankly I don't care what the owners of Dales or Black Cat Bakery think about Covid or whether they voted for Trump. I really, sincerely, don't care. I only hope for the best for their business and their employees. I know what it's like to struggle in Missoula, I did for years and I still would be if not for dumb luck and a bit of privilege. The problems people face today are starting to pale in comparison to my own, and a solution is becoming truly urgent. I can only hope people will come to understand if we care about solving these problems, then we have to put down the tribalism and intolerance for those with different views and focus on the matter at hand.
To quote Vince Staples, "Ain't no money in havin' hate in your heart."
You still have to understand the workers are also the one who's getting fucked here. The owner of the grill in the article is deliberately worsening working conditions because of his beliefs on Covid, and it's perfectly reasonable that the workers will leave you to get a new job where your boss doesn't spread Covid on you by not wearing masks. I understand businesses are hard right now, but business owners should care a bit about hygiene, it's not something that would cost you a lot.
> This city is amid a dire housing shortage, expedited by lack of new construction and a migration of buyers from more lucrative economies. The median home price increased by 57% in the last 10 years, 8.6% in the last year alone to $315k. In the meantime the median family income remains only $46k.
But I think you've correctly diagnosed the real issue here - skyrocketing housing costs. Everyone suffers from this, both the workers and the small businesses. And it's a shame that the Dems and Reps are making this an "us vs. them" issue. (There's a similar dynamic in my country too, where liberals try to raise the minimum wage a bit, and then the conservatives fiercely oppose it and latch onto small business owners for support. Of course both the establishment liberals and conservatives are totally incompetent at solving skyrocketing housing costs and general economic inequality, yada yada.)
I think the real issue here is not about workers or small businesses, but just plain-old economic inequality - in the sense that the minority rich at the top can invest on housing at their heart's content (numbers seem to always go UP!) but the majority can't afford those prices. So even though the majority at the bottom knows that the price is bullshit, the bubble will not burst unless the rich realizes that those prices are bullshit (And do they really have to realize? They can still afford those investments though! They can stay being delusional and still enjoy all the luxuries they have!) Market price is now not an objective measure of value, but instead becomes a power that real estate investors can collectively impose onto the poor. Ah, communism for the rich, capitalism for the poor...
In australia we have a $12.50/hr minimum for 15 year olds. It climbs in increments until about $25/hr.
This system allows teenagers to get a foot in the door for low-skilled jobs, and allows adults to get paid a livable wage.
The result is that a lot of fast food jobs are performed by teenagers, and they are considered entry level jobs. Adults are then paid more, and take positions where they can add more value that what a teen can provide.
The gap between a juvenile minimum wage and an adult minimum wage should equal the value of the on-the-job training that the juvenile is getting. And there's really no reason to tie that to youth, although demographically it will be dominated by young people; adults might accept a lower minimum wage in exchange for education in the trade.
Because its effect would be a transfer of jobs from working class adults to middle class kids.
I never understood the argument that middle class teenagers either should be given opportunities, or the opposite that they should leave those opportunities to adults. Society shouldn't be picking and choosing who gets what opportunities based on things as broad as age.
https://www.davemanuel.com/2011/04/21/the-average-age-of-a-f...
[1] https://www.dol.gov/agencies/whd/fact-sheets/32-minimum-wage...
There's also the fact that minimum wage cuts jobs. So if the budget allows for X hires at teenage wage and Y<X at adult wage, then it becomes even more difficult for adults to assume those jobs, meaning things like experience will count less in justifying the more expensive hire.
Now without the minimum wage, you could at least give the adult a job at a lower wage than what you pay teenagers. It sucks, but if the choice is between no job and some job that pays below a fair wage, it seems the latter is preferable if you don't want to starve.
Another bad habbit Americans have: they look only to their authority for answers (whomever that may be. e.g. the president, fox news, the church, etc). Go watch some Trump rallies to see this in action.
I'm beginning to believe our education system has left us lacking even basic critical thinking skills and thus we can not have two minimum wages.
Edit typo, and:
Not all Americans are this way, obviously, but enough are and they're in the right areas to cause problems. (wrt areas, see: https://en.m.wikipedia.org/wiki/Gerrymandering )
What you propose is exploitation, since you get to decide their rights and btw you also decided that their labor is worth less, but they have no say in all of these.
It looks like the pandemic has put and end to this. Transportation costs have skyrocketed to such a degree that it's basically impossible for a poor person to even get a car, because they are going to be outbid by a not-poor person who is willing to pay a lot more for the same crappy car because of shortages. Repair shops are having issues getting replacement parts, so even maintaining a vehicle is getting difficult.
We built our economy on exploitation, and now the exploited have been drained dry. So now we have to either pay up or do without.
This isn’t so much of an “all bosses suck” trope (I am happy and lucky to be at a healthier work environment at the moment). The sense I have is demands from the top continue to be more and more unrealistic as decisions are made to cut costs without truly thinking about it may start to rot the foundation beneath.
In my case, $18 sounds like a lot of money, but I wonder if this just means the work will be exponentially more stressful and unhealthy.
This is especially the case for part-time jobs which do not provide healthcare.
I do not think this is true in the absolute currently. I do think that the modern economies are imparting pressures that will make this more true over time.
The question every one asks is "What is the point?". The answer is increasingly, there is no point.
What about the answers previous generation might have had; send money home, improve life chances with an education, provide for a family, get a foot on the ladder, eat.
I think 20 years from now on one side looks like very low birth rates, mass homelessness and high suicide rates. For those that own assets now - a Parisian utopia surrounded by the former.
And for those that do continue to try, a room the size of a double bed containing an on-suite bathroom, kitchen diner, living-room and sleeping space - all in one! with no prospect of ownership.
Payday lenders make a killing on exploiting this.
Can you elaborate on this? $7.25 * 8 hours = $58. It's hard to imagine expenses adding up anywhere close to $58/day, especially if you factor in that in high cost of living areas the minimum wage is also higher than $7.25.
I saw a post recently that said something like "We watch Star Trek and marvel at their post-scarcity world. We are living in a post-scarcity world now, but all the benefits are being funneled by wage slaves up to the 0.1%."
Paraphrased.
I was talking with a friend who mentioned that a local pizza place is offering *$18/hr* for bussers at the restaurant. To me, that is a great wage for someone to wipe down tables and sweep floors. If they're still having trouble filling that, is it because making $37k a year in Texas isn't good enough for a no-education, no-experience job? Is it because the high-schoolers who would normally do that aren't looking for jobs due to pandemic? Is it the unemployment security and not having to actually do work 40 hours a week?
I wonder if the roles of people at restaurants will have to shift, so each person does some of everything, and get paid more, instead of having dedicated low-wage cleaners. Or that profit-sharing and healthcare may be the new model for restaurants.
The concept that entry-level food service is mostly staffed by high-schoolers who don't really "need" the money is the weirdest trope. Basically every restaurant is open during school hours. Who is handling the lunch rush?
Does that restaurant pay incoming career food service staff a wage sufficient to raise a family on?
A solid third of the households in the US take in under 50k/yr. More than half that are under 25k. I don't know about you, but 37k doesn't go far.
Assuming 30% effective tax rate that's 2158/mo.
1 bed flat in my city $1400
Cell phone bill: $100
Home internet: $100
Electricity: $50
Heating: $50
Healthcare: $230* assuming 50% sponsored
Car payment: $400
Insurance: $130
Without including food, dental insurance, deductible, OOP limits, retirement contributions, emergency savings, and anything at all for pleasure I've exceeded my budget. So, please, tell me more about how that's a good wage. How can someone go about improving ones position in life if they're kicked into a world that they'll never be able to afford? Should I go to college as an adult and get into eye watering levels of debt that'll follow me out of bankruptcy to keep bussing tables, like all the people that do just that? How can I juggle my full time job, side hustles at uber and lift (to keep the lights on), and a full course load? There are structural problems in society that no amount of blaming poor peoples bad decisions can wave away. Simple fact is some people with very large waists are going to have to tighten their belts so the millions of Americans whose only mistake was being born poor can have half of a fair chance at success and lead a modest yet dignified existence. There's no incentive for any halfway intelligent poor person to go to college unless they're a glutton for punishment, have a strong $upport network, and massive appetite for risk.
https://www.statista.com/statistics/203183/percentage-distri...
It's most likely because somebody in the area is paying more and/or offering a better job.
Is it really $37k, or is it an $18/hr job? That is, are they offering $18/hr for 40 guaranteed hours a week for 52 weeks, or is it just a few hours a day during the dinner rush (unless they send me home early because of a light evening)? Can they tell me today what hours I will be working 2 weeks from now, or do they usually disclose the schedule a day or two in advance? Are there any benefits? In other words, is it a typical restaurant job?
I personally would prefer (say) $16/hr with a guaranteed 40 hours and predictable schedule to a typical restaurant job. Now that big employers like Target, Amazon, etc. are in the $16 range, they may offer jobs that pay a lower hourly rate but are more compelling overall. (The Amazon warehouse in Fort Worth is paying nearly $18 and they have nonzero benefits and are unlikely to run out of hours.)
Maybe it's because it offers no meaningful health insurance, is most likely not full-time (such a job rarely is), and has little long-term promise.
"$100 in 1980 is equivalent in purchasing power to about $321.45 today, an increase of $221.45 over 41 years" - Source:https://www.in2013dollars.com/us/inflation/1980 This is a 68.89% decrease in spending power.
For comparison, the minimum wage in 1980 was $3.10, and minimum wage today is $7.25, and increase of 233.87%.
By rights the minimum wage should be able to keep up, with that big of a disparity. The problem is that purchasing power figure takes into account an average over all things. The ten cheapest cars in 1980 all had a base price under $5k (source: https://blog.consumerguide.com/cheapest-american-cars-1980/). Then ten cheapest cars in 2020 were, other than 1 exception, all below $17k (source: https://www.caranddriver.com/features/g29414710/10-cheapest-...). That's a decrease in spending power for cars of ~70%.
For median family single home in 1980, $55k. In 2020, $300k. (source: https://dqydj.com/historical-home-prices/). A decrease in spending power of 86%.
The majority of the US is facing a huge discrepancy in the decrease of spending power amongst big ticket items, the increasing lease-economy, and unprecedented debt. There is also a sense of entitlement at avoid certain menial jobs in some. As a result a $7.25 minimum wage is not going to cut it, as that's only $14.5k per year, well below the poverty line of $26.2k for a 4 person household (2020). Double it to $15k/hr and you still are just barely above the poverty line, forcing both parents to work full time, or one parent to work two jobs.
Most "pizza places" will not hire someone full-time. They want part time employees so that they do not have to deal with benefits.
Now, the intelligent thing to do as a nation would be to offload those benefits to the government so that companies would be free of the extra work AND employees would be free to move to better jobs... but America is not the land of the smart.
Where in Texas? On average for the state, that's only a living wage for a single person with no kids. https://livingwage.mit.edu/states/48
Making dual income households the norm was the mistake that has led us to this point. The reason that a fast food job is so impossible to survive on is that at one point, a single guy living in a small apartment and driving a modest car could afford that because his purchasing power was essentially DOUBLE what it is now.
That isn't an option anymore. If you want to be single, you need to also have a high paying job to do it. The other option is poverty, and maybe social services making up some of the costs that for many households is being made up by their spouse.
But it actually is a little worse than that, since it's being burned at both ends. For instance: I'm married. My wife and I are both extremely well paid software developers. This means that we have TWICE the power to buy a house, buy a car, pay for services like cleaners, buy a couch, buy a TV, etc. So now not only is a single person's wage lower due to a flood of the supply side, he's also screwed because the people doubling up on their income have pushed the demand side into the stratosphere.
It sucks, and it breaks my heart seeing the world that my single friends have to live in. Not only are they basically living in poverty, but it makes them unattractive to potential partners who they need to get OUT of that poverty.
I honestly can't really even imagine what the solution is. We certainly aren't going to put the dual income toothpaste back in the tube. Central economic authority forcing businesses to just increase their wages also doesn't seem to be a solution either, since it obviously doesn't even try to address the underlying problem (labor economics, mostly).
I see many people putting off kids or just opting out completely because COL increases have just made them too risky.
Personally, I’ve had to go through this recently where I received 5 job offers. All well below what I’d consider “market” rate. They were all lower than past offers. Basically, companies are being very cheap with equity and/or salary. If you live in SF and are a senior engineer, giving equity that only matches FAANG when the company hits an absurd valuation that will likely never come is just not going to get people to come. Why bother? Whole point of startups is that you could earn more than faang if you get lucky enough. It shouldn’t be that you just match FAANG if you get lucky.
That can't work. Current talent is a zero-sum game. You offer more, you get someone to switch over to you, somebody else offers more still and takes that person from you.
You might attract more future talent to the industry by offering more, but since software developers already make 2-10 times the average, I doubt that people think "you just can't make money in software, I'm going to do something else".
The problem is domestic producers can't compete against the actual terrible jobs with poverty wages that foreign producers pay. The trade off is binary. Either you put tariffs on cheaper foreign goods and protect your economy from predatory countries, or you tolerate downward wage pressure. There is no middle ground. It's such a simple and established reliable dynamic that even politicians can understand it.
Our democracies have chosen cheap stuff and downward wage pressure, with the spoils going to the people who manage the capital flows. It's not a right/left thing either, as both sides cynically advocate and exploit globalization to inflate those capital flows.
It absolutely is a left/right thing, it’s just that the imperialist countries have largely managed to exclude politics left of centre.
> Current pay for most of those positions: $10.50 an hour. Overnight shifts get $11.50. Tips are shared. (Current average rental cost for a one-bedroom in Missoula: $1010 a month, up 27% from last year
In other words, average rent is 63% of gross income. Completely unreasonable.
It's hard to sympathize with the business owners here. If they want to fill positions, the answer is simple: pay more. And more. And more. Until you hit the price that will attract applicants. If you can't find applicants at any price that keeps you in business, time to fold.
It's baffling how these stories that the article cites so often feature incredulous business owners shocked to discover they can't fill economically unviable positions. It's almost as if they think they're entitled to sub-subsistence labor.
When I was a student in LA in the mid-2000s I lived on basically this amount of money, inflation adjusted. I couldn't afford a one-bedroom, so I split the cost of a three-bedroom with two friends. This was a very common arrangement for people well into their late 20s, especially people in creative professions like writing.
Exactly this. A significant part of American business depends on cheap, low-overhead labor. America outsources a lot of that overseas (both white and blue collar), but fundamentally depends on filling shitty jobs and providing as few benefits as possible.
>We should ask ourselves, our communities, and our government: if a business can’t pay a living wage, should it be a business?
independently, but it sounds a lot like FDR's [0]:
>It seems to me to be equally plain that no business which depends for existence on paying less than living wages to its workers has any right to continue in this country. By "business" I mean the whole of commerce as well as the whole of industry; by workers I mean all workers, the white collar class as well as the men in overalls; and by living wages I mean more than a bare subsistence level-I mean the wages of decent living.
If it were real UBI, these people could work those shitty jobs while still receiving the extra income every month. It's still a shitty job, but you also get the added benefit of not having to live in poverty while you do it.
EDIT: Also, this situation is further proof of how useful UBI would be to the economy. It would be the government helping businesses by subsidizing wages, making even crappy unsustainable jobs livable and attractive to workers.
The top 1% are making more money than ever before. If you're holding assets impacted by inflation, you're doing quite well now.
If we take it as a given that in a modern, humane society no one should starve to death on the street and everyone should have access to the basics of survival, then the answer to the labor "shortage" is simply to shift some of the historically record breaking wealth inequality back down the org chart from the executives to the roles that need filling.
So if it’s a choice between $15/hour, steady to not work and $18/hour variable to bus tables or whatnot I’m not surprised that people choose the $15.
I expect this will be different once unemployment goes back to pre-covid and people are forced to make decisions.
Many jobs are terrible, I mean no one wants to be a janitor. So when finances allow me to not have to clean toilets and I can make a similar amount not doing it, any rational person will choose not to.
I’m really surprised that any low wage jobs are able to get folks to come into work right now.
It’s odd that the article doesn’t bring this up as the opportunity cost aspect seems like the most important factor in the “labor shortage.”
I honestly fail to see how janitor is a terrible job -- being in charge of keeping a building in shape, doing the repairs, etc.? That seems like a great job to me.
I'd wager most people would have a problem with the pay rather than the job itself.
I feel like this article and the others like it are just political opportunism.
In Southern Europe, the family (and not the individual) is the smallest decision making unit and it is typical to have 3 generations of people living under the same roof, all of them supporting (and applying pressure to) each other in different ways.
Parents and grandparents are helping youth financially. Youth in Southern Europe is typically highly educated, however, the job opportunities for high-skilled labor are quite limited.
Naturally, there are two options for overqualified youth: leave the family and get an underpaid job that cannot help them anyway to break even, or keep relying exclusively on their family (with the attached daily complaining from their end).
Result: Youth unemployment rates > 50%, businessess that cannot find cheap labor and close, economy that stays stagnant for decades.
If we, as a society, think there is some sort of minimum standard for living. (We should) Then we, as a society, should pay for it.
Increasing minimum wage seems like a roundabout unfair way of doing that via selective inflation. Which as far as I can tell would be largely a wealth transfer from the middle class to the lower class. Who spends a larger % of income at places people make minimum wage?
I think the government should guarantee some minimum wage and top people who don't earn that. Obviously a lot of moral hazard issues and complications with a system like that but I think it is better to have businesses worry about employing people and governments worry about welfare.
What seems to always be left out of these "if a business can’t pay a living wage, should it be a business?" discussions is what exactly are people going to do instead?
I'm ok subsidizing people's labour. I'm not ok subsidizing people's leisure.
That would be horrible. The bottom of wages would drop to zero (since offering above zero but below the government guatantee would provide no benefit in highering.) This would drag down other low wages since the jump from paying zero to paying just over minmum would be a huge cost increase for a minor highering benefit.
UBI is really the only functional alternative to a minimum wage.
Because, those restaurant (and retail and etc.) business owners are mostly not the ones making big money. Restaurants, in particular, are horribly low margin.
The end result of getting rid of "terrible" jobs, is that everything at the restaurant costs 2-3x as much, and so on at the many other businesses (agriculture?) which rely on cheap labor. Which means all those people in professional class jobs (e.g. programmers) will find that their salary doesn't go nearly as far as it used to.
Personally, I'm ok with that, I think it's the right thing to do. But it's not like it's the small business owners that are standing in the way of it; they cannot pay higher wages if their competition is not, so it has to be mandated. What's standing in the way of it is that this would be, at least temporarily, quite inflationary, and we have a professional class that is accustomed to not having to pay much for anything except houses.
When the individual market was terrible, it made sense to push employers to buy it for their workers, because you got better coverage for less money that way.
Now the state marketplaces are at least mediocre; coverage and costs are similar to what you might get as a small or mid sized employer. We should be pushing people towards marketplace plans, and not trying to continue the employer plan model.
And this is the reason he gave for not supporting ACA. $0.14 a pizza. To this day, I struggle to understand the psychology behind it.
This feels a bit backwards. We don’t know that their competitors aren’t already paying more, we only know that some people can’t seem to get labor at the price they were paying before. I think the numbers here are currently inconclusive, but I conjecture that what we’re seeing is small business owners losing labor monopsonies that they had come to rely on, and consequently a more competitive labor market. Of course competition causes upward pressure on prices, that’s the whole point.
This is tangential but I think America has been too scared of inflation for too long. There’s nothing wrong with a bit of inflation, especially if it means we can get closer to full employment. We haven’t even been meeting the fed’s (very low) target for quite a while.
Not 2-3x, more like 0.36% for every 10% increase[1]:
> Many business leaders fear that any increase in the minimum wage will be passed on to consumers through price increases thereby slowing spending and economic growth, but that may not be the case. New research shows that the pass-through effect on prices is fleeting and much smaller than previously thought.
> By looking at changes in restaurant food pricing during the period of 1978–2015, MacDonald and Nilsson find that prices rose by just 0.36 percent for every 10 percent increase in the minimum wage, which is only about half the size reported in previous studies. They also observe that small minimum wage increases do not lead to higher prices and may actually reduce prices. Furthermore, it is also possible that small minimum wage increases could lead to increased employment in low-wage labor market.
[1] https://www.upjohn.org/research-highlights/does-increasing-m...
1. Yes, everything costs 2x more for professional-class people, but also for working-class people. The numbers might get bigger, but the impact for those in the position to consider these terrible jobs is net nil.
2. For anything that doesn't require physical presence, the more you raise minimum domestic labor cost, the more attractive foreign labor looks, so you're also driving outsourcing.
I do not think it is ideal that the alternative option being utilized is government handouts. I'd rather people have the mindset to, for example, run their own hot dog stand on the street instead working for a fast food chain. But entrepreneurship is not easy for everyone.
We're having some price inflation due to supply chain issues. Cost of housing is more interesting... should we go public housing like Signapore, but contract it out to a country that isn't full of morons that cant plan/lawsuit/consult/build infra for a reasonable price?
With high unemployment pay, you lose that money the moment you go get a job so it creates a disincentive to work.
Personally, I like having many options for food to eat. If all the marginal small businesses had to close because they can't pay someone $15/hr to wipe tables, then we might just be left with large chains like Olive Garden or Cheesecake Factory. I think people should get paid what they are worth, whatever the job. But I also like being able to get food from small restaurants from different cultures.
And if all the marginal restaurants close, won't that just give more power to the larger corporations? they'll be able to raise prices, lower wages, whatever they want because there will be less competition.
Obviously, the unemployment increase / stimulus in the US will end at some point. And then there will be a lot of people looking for jobs at once. People should figure out what they think a fair wage is for entry level jobs and take it if it's being offered.
I have a cookie company that raised the pay after we opened our 2nd location (economies of scale, buying in bulk, etc).
Its in my interest as an employer to raise the pay since it typically raises the buy-in from employees. Companies like Netflix and Costco pay at the top of the competitive range and it allows you to run a tighter ship.
Payroll is a cost, sure, but it's also an investment if you can afford it. Raising the minimum wage removes that competitive advantage for me.
It takes time to bootstrap a company. It still only pays me half an engineering salary after 3 years.
Right now, that only happens because some people aren’t lucky enough to be born in the right house. People don’t work nights and weekends for paltry wages out of their desire to serve people food.
So it would hurt consumers. But it would help those who provide to the consumers.
Imagine how expensive food would be if the people on this forum demanded to be paid “fairly” for weekend and evening work.
It seems like it could really be a disaster for people working in retail though. Hopefully those retail jobs would end up replaced by something better, like working in an Amazon warehouse....
They (humans in Amazon warehouse) too are being replaced by robots. Not sure how many people know that Amazon has a robotics division [1]
Like any modern corporation, Amazon is continuously looking to reduce cost and warehouse automation is the next obvious place, by automating most of pick/pack work.
Even in shop experience is getting massively disrupted. At the one end of the spectrum there are self checkout kiosks that are super convenient and popular in the Netherlands and at the other end Amazon Go and similar with zero or minimal personnel running a shop.
These types of jobs are popular among middle to just below middle class youth (high school goers) in order to earn a few bucks and reduce financial burden on their parents. With these jobs getting automated, at least in the developed world, I wonder what’ll be those stepping stone type of jobs which are low on skill that need manual labor.
Employers might want to consider hiring more people in smaller shifts. Maybe an extra person and put everyone on 3-4 day shifts rather than 5-6. It'll be interesting if this phenomenon holds.
Of course the US workforce has been constantly squeezed for the last 40 years, so maybe the COVID was the breaking point. No more cheap labor because people are unwilling to live with their parents / not have health insurance. People really mastered how to live cheap over the last year as well.
Make no mistake, COVID was a seismic event in the US economy that will have lasting changes.
I thought that doing this to avoid providing healthcare was the problem. Many jobs that can't be filled are for part time hours at terrible pay with no benefits.
Going forward I think people are just not going to put up with bullshit the way they did before.
Obviously, I’m coming from a position of privilege here, but putting myself in the shoes of a potential restaurant worker, assuming I wanted to put myself in a better long-term financial position, I would simply choose to not be a restaurant worker and study/apprentice for something else instead. I’d imagine that actually working in a restaurant teaches plenty of useful life skills, but unfortunately I’m not sure that experience really translates into a marketable resume. Unfortunately, in a competitive job market, there’s an opportunity cost associated with time spent in jobs that don’t enhance one’s desirability to potential employers.
Now obviously not everyone has the option to simply forego low-paying work and become a student/apprentice, and I’m sure some people really like working in restaurants (even fast-food chains), so I’m not arguing that restaurants should simply disappear. Instead, I think we should work to reduce the competitive nature of our economy so that cheap, convenient food (or similar services) isn’t effectively being subsidized by the existence of a permanent economic underclass with no career options beyond low-paying, so-called “low-skill” work. Fast-food workers should be there because they want to be there, not because it’s their only option.
American society is built around work and constant competition for better-paying work - that’s certainly not unique to the US, but the high-levels of income inequality and winner-take-all job market dynamics sort of are (at least among countries with similar social + economic profiles). We should try to create a job market where people can choose full-time jobs they enjoy and excel at without worrying about whether they can afford to have children, maintain stable housing, or be able to retire some day. To do that, I’d expect that we need to reduce the power differential between the restaurant/business owners complaining about a lack of people willing to help them make money for low wages and the potential employees they’re complaining about.
What can help is government regulation that raises the wages at ALL restaurants. Then consumers don’t have a choice. I grumble more about paying an extra 4% on top but what am I going to do, never go out again?
However there is a problem. The 'standard job' is now gardening leave with a wage, which any other job has to compete with. And what that leads to is a 'dead zone gap' in the wage structure between the 'standard job' and the next reasonable job (say working 9-5 Mon-Fri with full benefits, close to home). A private employer has to pay a much higher wage than the payment for the 'standard job' to get people to work for their 'reasonable job'.
(You get the same between unemployment benefit and the 'minimum wage' in many countries).
However we could have everybody earning the living wage working for a publicly provided 'reasonable job' at a living wage, which would mean the that the private employer would only have to pay a penny more per hour to get the labour they need.
The most efficient construction is when the 'standard job' and the 'reasonable job' are the same. That eliminates the 'dead zone wage gap', and allows people to smoothly move between public and private jobs, increasing the efficiency of the use of labour - all without exploitation.
And those business that can't deliver a profit with this system? Well they get to close to make room for better businesses that can.
Business is there to serve people, not the other way around.
Pretty expensive for a little town in the middle of nowhere...
No one is “too lazy” the wages don’t pay enough to support even a single adult in most places!
Most impoverished adults would have a better chance of climbing out of poverty if they DID NOT work at low or minimum wage jobs at all and instead foraged for nuts and berries.
Think a bit harder on the problem than to simply cry revolution. Swaths of people die, families are destroyed, the economy is destroyed, the nation becomes vulnerable ( if you still have a nation ). You will have to deal with the problems you created before you ever get the opportunity to work on what you were originally revolting about.
Such a thing does not exist.
Beyond that, there's too much noise in this article about "capitalism" and "BIPOC" and in reality what's happening is a job market going back to normal, where people actually have options, rather than the extended "recovery" of the great recession where people had none.
But you can't get the $X that you'd get if you didn't work at all, and add on $Z dollars working a job of some kind.
The perverse incentives of these programs around their phaseouts are and have long been a reality of low-income communities.
But then a pandemic comes along and takes away job A, meaning that there's not extra friction to leaving job A. You've already left! All these people have gone to job B (or location B, or family arrangement B, ...) which was better all along, it's just that the change had too much additional overhead in normal times.
Now you have places which depended on that friction wondering where everybody went.
They have fast food and other restaurants here, but there’s a shortage of good bagels. They seem crowded at the times one would expect. I think things come down to what people expect and how they set things up.
Basically, you have an administration 'silently' waging war of certain types of business or jobs without needing to pass controversial legislation for things like a minimum wage increase or universal income. If it feel subversive, it is. But the cost of controversy these days causes people to find alternative options.
It is now possible to make 130% to 200% your pre-covid salary/wage by being on unemployment. [0] It is generally human nature to do as little as possible to survive. In this case you don't have to do anything to survive. Why would you go look for a job.
This will put large swaths of businesses who could stay afloat pre-covid and were forced to close due to covid to not be able to open their doors again.
[0] https://www.cnbc.com/2020/05/09/it-pays-to-stay-unemployed-t...
Stores and restaurants are thinly staffed around here. Even the ones with signs out saying they’ll pay a premium.
certainly applies to tech
For 2, consider this: https://www.dhs.gov/immigration-statistics/special-reports/l...
New entries in Q4 2020 down 78% from the year before, and that's on top of a general downward trend in net immigration to the US that's been happening for a decade. Is this temporary because of Covid? Probably. But immigration at the low end of the wage scale is a factor that drives down the wages. Anyone who has ever lived in an apartment complex in Santa Ana and seen neighbors with 14 people packed into a 3 bedroom apartment understands why. Native born Americans simply aren't willing to live like that. The expectation for what constitutes a baseline reasonable lifestyle isn't the same.
For 1, these comments about "experimenting with UBI" or freeloaders living off the government seem to miss the point that augmented benefits are a temporary pandemic relief measure. Of course the low end of the labor market is abnormally depressed right now. That is on purpose as part of a calculated, intentional public health response making it easier for people to decide not to work. Lo and behold, many are now actually making that decision.
For some reason, there seems to be this widespread notion that this is a permanent change, but it isn't. You're still not technically allowed to just quit or refuse to work because you want unemployment, but go ahead and look at the actual description of what constitutes a Covid-related reason to apply for relief: https://wdr.doleta.gov/directives/attach/UIPL/UIPL_16-20.pdf
If your place of employment was closed, if your kid's school was closed, if you were ever diagnosed, had symptoms, were quarantined, or anyone in your family was, your head of household died, you need to care for some who was diagnosed. None of those are usually reasons you're allowed to claim unemployment benefits. Now they are.
How long will this go on? Who knows, but definitely not forever. This is also the answer to why businesses don't just offer more. Prices are subject to a ratchet effect. Offer more now to overcome the inertia of people choosing to stay unemployed during an abnormally favorable time to be unemployed and you're very likely to have to permanently pay higher wages even when the enhanced benefits are gone. Businesses are getting relief, too, and are willing to gamble that they can wait long enough for wages to come back down.
Why do politicized right-wing economists pretend supply and demand pricing doesn't apply to the labor market? It's supposedly the foundational pillar of right-wing extreme laissez-faire cult economics.
Universal healthcare would go miles to making these tolerable/palatable jobs to a wide variety of workers. Often what is lost in the "americans don't want to do job X" is that "Job X DOESN'T GIVE HEALTH BENEFITS".
I don't accept the verdict that these economic hardships necessarily mean that "capitalism is broken" or "rigged" or that we need to rethink "ownership scenarios" (whatever exactly that means). The economy is a vastly complicated system of countless trades per day, and there are a lot of variables in flux that are making things very crappy for a lot of people. But I fear trying to make things better by blaming it on capitalism being "broken" or a "rigged game" is more likely to make things worse.
But Pandora's box was opened, and destabilization seems to be the only possible outcome at this point. It won't be as rosy as this article makes it out to be.
You can't stop the murders. But you can land me a dream job? Puh-leeze.
A: "we should give everyone free money!"
B: "no, that'll make everyone lazy..."
A: "no, people will work on things they love instead!"
[everyone gets free money]
[nobody works, everyone plays video games all day]
A: "see, this proves that everyone was being exploited!"
B: [smh]
Perhaps the answer is to start shortening the work week.
If employers really wanted more workers, they'd up wages.
If employees really wanted to work they'd settle for less.
If neither is happening then everyone is happy and anyone complaining is a liar in the economic sense.
The corporation needs labor, but the employee need money, not labor (but it happens that most common way for normal people to earn money to live is through labor).
The complaining is an economic act in itself - employers whining about "unable to find workers" usually get political help as a result, either in the form of tax breaks/other subsidies or in the form of relaxed labor laws/enforcement (e.g. loosening the requirements to fire someone, reducing the amount of inspection for undocumented workers).
Paying everyone a living wage (last sentence) is impossible; not because 'living wage' is relative - from a city to another, from a country to another, from a person to another (can you live without an iPhone? why not?) - but because increasing wages to that level, assuming you can determine one, will just increase the prices to fit.
My first job was paying $100 and it was about the average in the capital city of my country. 5 years later I was earning $700, but that was just double the average pay. Another 10 years later, a bit over $1000 was above average, but not by much. The salaries grew 10 times, but the prices adjusted about the same rate, at least the price of food, rent and houses: if you pay 10x more to workers, the house will cost 10 times more. If you increase the salaries of many people, you will not increase their standard of living, just create inflation because they will not produce more, it's just their cost is higher and the money value is reduced.
This is the real story of a country with 20 million people. If you increase the wages of the lowest paid, you need to increase to everyone to keep some proportions, otherwise you will pay restaurant cleaners more than teachers or doctors and that is dangerous, ~ 20% of the younger doctors in my country emigrated because at some point their salary after 20 years of tough school was sometimes lower than a driver's salary. If you increase the salary of everyone, that is very soon making all prices to increase at the same rate, changing practically nothing.
Is this what the article is suggesting?