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Comment by EpicEng | Hacker News Reader

This is entirely anecdotal, but I grew up in the Midwest and know many people who spent their lives working in automotive factories. I wish these people the best, and I'm glad that they are doing well, but many of them are making $25+ / hour installing doors and seat belts (and the '+' here has a high ceiling).

This is a job that any able bodied person can do, but they make that living, for better or worse, because of their unions. If I were funding these plants I wouldn't want to pay those wages either.

As a reasonable person I have to admit that this sort of work is simply is not worth that pay, regardless of what my personal feelings toward my friends and their families are. These are not skilled positions.

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It's a tightrope because when it becomes cheaper to automate whatever job they were doing manually, then they make $0 per hour.

That's the case in South Africa with farm workers and their unions driving up the minimum wage. There is 25% unemployment nationally and they are clamoring for more money. The farmers just go "well at this price point, I might as well just buy some more machines and get rid of these people".

Machines have no unions.

How is inflation is SA currently? Inflation tends to hypertrophyze unions, because there comes a need to a common agreement to adjust wages across the board to keep up with prices.

It varies, but for the past 2 years it's been around 6%. So yes increases are necessitated, but the unions generally start off with ridiculous demands like 15% increases and benefits and they have no problem with striking for days on end.

The problem really is that when you have 25% unemployment, where those 25% are almost all unskilled then you work to eat and not much more. You don't have much bargaining power there. So again, if you're unskilled, oversupplied and are replaceable by machines, you should be very careful about what sort of demands you throw around. I'm not sure if unions are really conscious of this fact or just trying to appease the workers demands.

Ok, so what exactly is a proper pay for installing seat belts and doors?

Is a job not being "skilled" mean the person doing it must live in poverty?

>Is a job not being "skilled" mean the person doing it must live in poverty?

"must" is a strong word. But I would be worried about the possibility and perhaps diversify my skill set.

So what?

This is the thing I don't get, why shouldn't the employees of the company, no matter how skilled, share in the good times? They certainly pay in the bad times.

As companies have become ever more callous and unions ever weaker all the money has moved to the owner side. It's not simply just about "I won this factory, therefore I get all the money", as I think we're going to find out in the next 20 years, that kind of thinking leads to major civil unrest and we will probably see the replacement to unions forming in the next decade or so.

The way to do that is via profit sharing/bonuses - converting payroll from a fixed to a floating expense, essentially.

I disagree that "companies" have become more callous. The general public want their cheap stuff, and they don't really care. The press is full of horror stories about sweatshops every week and yet, everyone wants their new iPhone and their new trainers and their clothes to wear for a few months at most... What will it take to effect a change in the mind of the consumer?

But they don't generally share in the bad times. If a company has a bad year most people don't take a pay cut. And they definitely won't get paid nothing for a year while lending money to the company!!!

For example you own a local garage. On normal years to make $500,000. Your costs are $400,000. One year thing go bad and you only make $300,000. In most cases the owner will borrow the money to cover the difference. Maybe someone is let go but in most cases the owner tries to retain the staff hoping next year is back to normal. Maybe the owner will use his own money rather than borrow. In any case they will find the money somehow or close. And remember this is at the same time as having your salary reduced to $0!

Eventually the owner wants to recoup and protect themselves from any bad year. But at a $100,000 profit a year, and remember this is pre tax, and profits are double taxed for the owner, then how long will it take to save pay them back and save enough for the next bad year?

So if one year he make $600,000, or double the profits, he needs to keep those profits for the bad years.

Now big corporations are slightly different but at the same time they need to be absorb harder years. So right now they squeezing profits but at some point those profits will be needed for a bad year. Or perhaps it was to pay for the recent bad years in which they may have acquire debt...

Some corporations are greedy, but a lot aren't. You have to look at the multi year picture when it comes to profit sharing. And most employees are not willing to loan money to a corporation in a bad year like the owners will most likely have to ;)

> most cases the owner tries to retain the staff hoping next year is back to normal

Any evidence to support that claim? Especially during the crises (when there is not one, but several years), I think it's not very true.

> profits are double taxed for the owner

They are not double taxed if they are reinvested in the company (or saved as insurance for bad years).

> the owners will most likely have to [loan money to a corporation]

Really? Any recent examples?

You're assuming that both the company and that division of the company survives. If it goes under, if labor is outsourced, if a factory closes, the workers lose their jobs. Of course they share in the bad times, and far more than the owners of the company do, since the workers have more at stake.

You present a false choice here, regarding employees not "generally sharing in the bad times". The CEOs of these companies often don't share in the bad times either, while they most certainly are rewarded for the good times. Why should it be any different for all levels of employees?

Now, regarding the owner of a small business loaning their company money, while employees do not. Employees are not given the choice, likely because the loan is to high of risk for the average employee given their personal net worth and as important most owner's don't want their employees to be given the option (ie. as an owner of a garage I would not want my employees having that level of access to the company's finances).

The primary issue however is the treatment of labor, let's not get lost in details of risk/loans/etc. Given that technology is leading to a surplus of labor, a general multi-decade trend against labor. The question that society needs to address is how do we treat labor? Business can exploit labor pushing what's acceptable, which will lead to larger wins for industry as we can already see today, but is that right? I think you and I differ in opinion on the answer to that question.

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