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If pay had kept pace with productivity gains, minimum wage would be $24 an hour

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Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#101

Post by Sohcahtoa82 »

norseboar wrote: post #95

I think there's a bad assumption in here, which is that pay should keep pace with productivity gains in the first place. I'd argue the whole point of productivity gains is that they do outpace pay. The idea is the same work generates more value. Some of that extra value can be passed back to the employee, but if all of it is passed back to the employee, then the goods produced don't actually get cheaper. If nothing g…

This flies in the face of so many HN readers that claim that salaries are based on the value created by the employee.

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#102

Post by jaggederest »

norseboar wrote: post #95

I think there's a bad assumption in here, which is that pay should keep pace with productivity gains in the first place. I'd argue the whole point of productivity gains is that they do outpace pay. The idea is the same work generates more value. Some of that extra value can be passed back to the employee, but if all of it is passed back to the employee, then the goods produced don't actually get cheaper. If nothing g…

I think you have to look at the division of the added value by the changes in productivity. Were it something closer to 50-50 that might be reasonable, but so far as I can tell based on changes in wages over time, that's not the case at all.

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#103

Post by shadowgovt »

commandlinefan wrote: post #85
shadowgovt wrote: post #80

Earlier quoted context omitted.

Essentially. Which is why unionization is such an important process---it binds the supply-demand curve so that employers are forced to allocate the resources more equitably. Supply suddenly dries up if nobody's willing to work for you because you won't pay a living wage (let alone a decent wage).

Well, any way you slice it - through unionization or through legislation - a $24/hour minimum wage is just going to mean massive unemployment, not 3x more money in everybody's paycheck.

I think it depends. If the CEO can make more money selling 200 million whatever than 100 million whatever, they're still going to hire enough to make 200 million, even if they're taking home less than they would in the hypothetical world where they were making 200 million whatever and their bottom-tier employees were on government subsidized housing.

But in the longer term, I think you raise a great point---it's a huge incentive for the CEO to figure out how to automate making 200 million whatever so that they can pay $0. Which is good for the economy in general (automation means more free human time), but societies have to adapt to a lack of labor-intensive jobs to go around.

They already need to be adapting to that, because we're already in the middle of the automation revolution.

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#105

Post by mrguyorama »

comeonseriously wrote: post #5

How much would a cheeseburger and a shake cost?

In denmark, with significant benefits and high wage and all sorts of wonderful pro worker and pro average person systems, a big mac costs $0.35 more than the average big mac.

https://www.businessinsider.com/denmark-mcdonalds-pays-20-an...

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#106

Post by mortenjorck »

michaelbuckbee wrote: post #40

There's a lot of reasons for this but one of the largest is the near invisible (to me) structural shift from direct hire to contractors for jobs at the lower end of the wage/salary spectrum. There is a fantastic long form article that articulates this better than I can at: https://highline.huffingtonpost.com/articles/en/poor-millenn... The portion relevant to this discussion: "Thirty years ago, she says, you could wa…

There’s an excellent and frankly damning ProPublica report that serves as a case study in the movement to rely on staffing companies for low-wage labor: https://www.propublica.org/article/meet-the-customer-service...

The degree to which both costs and risk are shifted onto workers is at times astonishing:

“After paying about $1,500 for home office equipment: a computer, two headsets and a phone line dedicated to Arise; after paying Arise to run a check on her background; after passing Arise’s voice-assessment test and signing Arise’s nondisclosure form; after paying for and passing Arise’s introductory training, to which she devoted three days, unpaid; after paying for and passing a certification course to provide customer service for Arise client AT&T, to which she devoted 44 unpaid days; after then being informed she had to get more training yet — an additional 10 days, for which she was told she would be paid, but wasn’t; and then, after finally getting a chance to sign up for hours and do work for which she would be paid (except for her time spent waiting for technical support, or researching customer issues, or huddling with supervisors), Tami Pendergraft spent three weeks fielding telephone calls from AT&T customers, after which she received a single paycheck.

For $96.12.”

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#107

Post by SpicyLemonZest »

vannevar wrote: post #86
SpicyLemonZest wrote: post #78

Earlier quoted context omitted.

I agree with what you're saying, but I think it's inevitable. The system is set up that way as an inevitable consequence of modern technology; automation and economies of scale are simply better at producing valuable things, so much better that an individual worker with no capital can't compete. We can change who has access to capital or reallocate the benefits of capital, but we can't change the fundamental problem…

It's inevitable only if we decline to regulate capital. Just as it's also inevitable that a speeding truck will crash, unless the driver puts on the brakes at some point. There is nothing in the laws of physics that dictates that our financial system must be as it is. It is the result of our collective choices, and we can change it when it becomes in our best collective interest to do so.

The fundamental problem is, if you need a factory with 100 workers in order to effectively manufacture anything, then the ability to innovate in manufacturing is limited to groups who have sufficient capital to direct the efforts of 100 people.

There are of course different ways to organize that capital. Capital can be owned by rich people, by corporate firms, by the government, by worker collectives. But it's still a finite resource. As a matter of mathematical inequality, there's no way to give everyone the power to direct a large factory.

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#108

Post by Sohcahtoa82 »

leetcrew wrote: post #74
hinkley wrote: post #11

Earlier quoted context omitted.

A good follow-on question might be, do we expect more from low-wage employees now than we did then? When I was a teenager, food service proved to be a much more complicated job than I anticipated it to be. My first tech jobs paid better (even though an internship would have paid more), and felt simpler. If only because I'd spread out the effort of learning the skills over 8 years instead of 3 months.

I too was surprised at how complicated my first food service job was. there are so many opportunities to mess up in every minute of peak hours. at the same time, I almost miss it. if food service paid the same as software dev, I might seriously consider switching back. as stressful as it was, there was a sense of closure at the end of every shift. if I messed something up, I would either hear about it by the end of t…

I worked at Subway for 6 years while earning my CS degree.

I sometimes miss the mindless simplicity of the work. I miss knowing exactly what I need to be doing every day.

But I certainly don't miss with dealing with the general public, where a very vocal minority has decided that it is socially acceptable to yell at service workers. It's even worse when it's their own mistake, like they ask for mustard when they meant honey mustard, and somehow I'M the idiot for not knowing which one they meant.

Or they ask for "light mayo" and I ask them to clarify if they meant a small amount of mayo, or the low-fat mayo, and they snap an answer back at me as if I was being a smart-ass. The answers were close to 50/50 by the way.

Damn maybe I don't miss it after all. I could go on for hours about how shitty some customers can be.

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#109

Post by bhupy »

germinalphrase wrote: post #100
norseboar wrote: post #95

I think there's a bad assumption in here, which is that pay should keep pace with productivity gains in the first place. I'd argue the whole point of productivity gains is that they do outpace pay. The idea is the same work generates more value. Some of that extra value can be passed back to the employee, but if all of it is passed back to the employee, then the goods produced don't actually get cheaper. If nothing g…

Presumably, it is possible for a product to also get better.

Yes, and product improvement is largely attributable to R&D, rather than assembly-line-level production. Those gains disproportionately flow to high skill white collar workers.

Re: If pay had kept pace with productivity gains, minimum wage would be $24 an hour

#110

Post by tasty_freeze »

Many comments are focused on "But why should minimum wage jobs pay scale rise with productivity? The jobs haven't gotten any more demanding."

But isn't this logic applied to average CEO pay, which has gone up many times faster than productivity? CEOs work isn't any more demanding than it used to be, either.

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