It's not a labor shortage – it's a wage and workers rights shortage • Hacker News Board

Re: It's not a labor shortage – it's a wage and workers rights shortage

#171

Post by giantg2 » Sun, Sep 05, 2021, 6:56 PM UTC

AnthonyMouse wrote: post #47

atrus wrote: post #12

Painfully obvious too. My little local Mexcian place will be closing down because of a lack of cooks. Talking to the owner, he was complaining about government benefits, and how they all want $20 an hour. I don't understand it, that you'd either a) be willing to drive your business into the ground serving a limited menu because you won't hire a couple cooks at $20 an hour, or b) have a business so close to the brink…

> b) have a business so close to the brink of shutting down that an additional $20-50 an hour will shutter you. This is the default state of businesses in competitive markets. If you could do with less then you could charge less, and one of your competitors will start doing that to take your customers, so you have to do the same. Of course, the alternative is to pay more and then raise prices. Which you might not be…

Not to mention your competitors may be switching to robots, greatly reducing their labors to the point it might not be competitive if you're using humans and don't have the capital for the robot.

Re: It's not a labor shortage – it's a wage and workers rights shortage

#172

Post by Ericson2314 » Sun, Sep 05, 2021, 6:57 PM UTC

AnthonyMouse wrote: post #47

atrus wrote: post #12

Painfully obvious too. My little local Mexcian place will be closing down because of a lack of cooks. Talking to the owner, he was complaining about government benefits, and how they all want $20 an hour. I don't understand it, that you'd either a) be willing to drive your business into the ground serving a limited menu because you won't hire a couple cooks at $20 an hour, or b) have a business so close to the brink…

> b) have a business so close to the brink of shutting down that an additional $20-50 an hour will shutter you. This is the default state of businesses in competitive markets. If you could do with less then you could charge less, and one of your competitors will start doing that to take your customers, so you have to do the same. Of course, the alternative is to pay more and then raise prices. Which you might not be…

If everyone's wage goes up, the economy is probably running hotter and there is more growth. Don't forget the macro side if things!

A lot of well-credentialed people will say "bu- but the 1970s", but the fact of the matter is the wage share of income could also change, and rather than knee-capping unions to control inflation, we could have done price controls (as was done in the 1950s), profit controls (which would limit dividends and buy backs, not reinvestment to boost supply) or other such things.

Re: It's not a labor shortage – it's a wage and workers rights shortage

#173

Post by Robotbeat » Sun, Sep 05, 2021, 6:57 PM UTC

AnthonyMouse wrote: post #47

atrus wrote: post #12

Painfully obvious too. My little local Mexcian place will be closing down because of a lack of cooks. Talking to the owner, he was complaining about government benefits, and how they all want $20 an hour. I don't understand it, that you'd either a) be willing to drive your business into the ground serving a limited menu because you won't hire a couple cooks at $20 an hour, or b) have a business so close to the brink…

> b) have a business so close to the brink of shutting down that an additional $20-50 an hour will shutter you. This is the default state of businesses in competitive markets. If you could do with less then you could charge less, and one of your competitors will start doing that to take your customers, so you have to do the same. Of course, the alternative is to pay more and then raise prices. Which you might not be…

But competitors are already in the same boat. Demand for business is high.

I really think that some of this is about class solidarity among business owners (especially small business owners). I say this as a political centrist, too.

There are a bunch of reasons why wages are "sticky" (i.e. they don't go up--or down--when you'd expect that to be the rational decision in an efficient market), and this is probably one of them.

Also, there are ways to seek out higher efficiency. Hire at higher wage but expect and prepare for higher productivity. Operate the business for longer hours to make the most of money paid for rent, etc. Unfortunately, I think small businesses where I live (in southeast Virginia) are much worse at this than larger businesses.

Re: It's not a labor shortage – it's a wage and workers rights shortage

#174

Post by ChrisMarshallNY » Sun, Sep 05, 2021, 6:58 PM UTC

tafox wrote: post #169

zthrowaway wrote: post #132

Earlier quoted context omitted.

Nice framing. Or it’s to get paid for bearing all of the risk of starting and running the business, and being financially on the hook for when it fails and gets to deal with years of being sued.

Exactly. Just like the financial crisis. All those big CEOs getting caught on the hook.

CEOs and business owners are often not the same thing.

The CEO is someone that is hired by the owners, to run the company.

They may make good money, but they are paid peanuts, compared to the real owners (stockholders).

Re: It's not a labor shortage – it's a wage and workers rights shortage

#175

Post by Viliam1234 » Sun, Sep 05, 2021, 6:59 PM UTC

toomuchtodo wrote: post #13

atrus wrote: post #12

Painfully obvious too. My little local Mexcian place will be closing down because of a lack of cooks. Talking to the owner, he was complaining about government benefits, and how they all want $20 an hour. I don't understand it, that you'd either a) be willing to drive your business into the ground serving a limited menu because you won't hire a couple cooks at $20 an hour, or b) have a business so close to the brink…

Same with a bundle of Great Clips a friend manages for a franchisee. Can’t find staff, doesn’t believe staff are worth what the current effective minimum wage is. “Have you tried offering more?” “That’s too much for cosmetology work.” Getting slapped by the invisible hand of the market.

If bread costs more than I would like, it's not a shortage of bread, it's just the bread being more expensive than I would like it to be. Exactly the same thing about labor. There are many people looking for a new job, and if you make it known that you pay more than they have now, some of them will run to you.

I have seen software companies making a similar mistake. Of course, the salaries there are way above the minimum wage, but still the same logic. They complain: "We wanted to start this new project, but we can't find developers; we have been posting job announcements online for five years already!" I look at the job announcement, it offers about 2/3 of the market salary. "Have you tried offering more?" Blank stares. I guess, how could that possibly be relevant?

Maybe the problem is that the employers see employees as "the ones who obey", which is generally true... except for the job interviews. There, you cannot simply give orders and expect them to be obeyed. The candidate will only take the offer if they like the proposed deal. Also, for the ones who accept, you can gradually make the deal worse, by increasing the workload and keeping salary the same regardless of inflation... until the surprising moment when the employee decides to walk away, because they got a better deal somewhere else.

Re: It's not a labor shortage – it's a wage and workers rights shortage

#176

Post by Robotbeat » Sun, Sep 05, 2021, 6:59 PM UTC

Daishiman wrote: post #148

AnthonyMouse wrote: post #47

Earlier quoted context omitted.

> b) have a business so close to the brink of shutting down that an additional $20-50 an hour will shutter you. This is the default state of businesses in competitive markets. If you could do with less then you could charge less, and one of your competitors will start doing that to take your customers, so you have to do the same. Of course, the alternative is to pay more and then raise prices. Which you might not be…

The dirty open secret about development is that in highly developed countries with low inequality, human labor is just horrendously expensive, and since dining out has costs dominated by human labor, even relatively wealthy people dine out rarely. Ask the Swiss or Danes. Cooks can have a living wage, but fancy meals are comparatively much more expensive than their equivalents in the US, given their lack access to und…

That sounds like a good thing that human labor is properly valued.

Re: It's not a labor shortage – it's a wage and workers rights shortage

#177

Post by Ericson2314 » Sun, Sep 05, 2021, 6:59 PM UTC

listless wrote: post #137

delusional wrote: post #115

Earlier quoted context omitted.

This is a purely economic argument which if fine, but misses the vital non-economic side-effects. More money could lower the stress of the employees (given they now no longer have to worry about paying their bills) which may lead to higher quality products. Increased wages may attracts better talent or more exploitation conscious consumers. Hell, it may even more the owner more likely to listen to his staff, given th…

The problem is that it IS a purely economic problem. It's just math - supply, demand and competition. Small business in particular is captured by these forces. It cannot increase prices because people will go to the competition. And it has no margin to absorb people's desire to earn enough to live a middle-class life doing a job that you can hire anyone to do. All of that said, what you could reasonably hope would ha…

It's not just amortized supply and demand.

We ask, why don't workers go on general strikes? Well small businesses refusing to even try raising wages and prices amounts to a capital general strike.

Employers and employees simply have radically different market power, and that is as fundamental a fact in all economies remotely like ours as any econ 101 supply and demand.

Re: It's not a labor shortage – it's a wage and workers rights shortage

#178

Post by Robotbeat » Sun, Sep 05, 2021, 6:59 PM UTC

maxlybbert wrote: post #72

atrus wrote: post #12

Painfully obvious too. My little local Mexcian place will be closing down because of a lack of cooks. Talking to the owner, he was complaining about government benefits, and how they all want $20 an hour. I don't understand it, that you'd either a) be willing to drive your business into the ground serving a limited menu because you won't hire a couple cooks at $20 an hour, or b) have a business so close to the brink…

> I don't understand it, that you'd either > > a) be willing to drive your business into the ground serving a limited menu because you won't hire a couple cooks at $20 an hour, or > > b) have a business so close to the brink of shutting down that an additional $20-50 an hour will shutter you. Restaurants run on notoriously thin margins ( https://upserve.com/restaurant-insider/profit-margins/ ). There's a reason resta…

Maybe one of those miscalculations is not paying workers enough to keep them hired.

Re: It's not a labor shortage – it's a wage and workers rights shortage

#179

Post by [deleted] » Sun, Sep 05, 2021, 7:00 PM UTC

[deleted]

Re: It's not a labor shortage – it's a wage and workers rights shortage

#180

Post by cableshaft » Sun, Sep 05, 2021, 7:00 PM UTC

prepend wrote: post #45

rebuilder wrote: post #25

Earlier quoted context omitted.

The problem with this is, if the barista gets automated, the customers buy better coffee machines and stop going to the cafe. An exaggeration, but you see my point perhaps. Unless your service is really purely about bang for buck, trying to automate it in ways that are visible to the customer can have downsides. McDonald’s could probably go full robotic. Starbucks? Not sure, maybe. It would be a little offputting. Yo…

This is not my experience. Watching Starbucks and my other local coffee places implement app/cashier less ordering it seems like more customers and more purchases. Ordering on my phone while I’m the way is easier than talking with a human. And easier to add stuff on. I’ve never considered buying an espresso machine and bypassing my local coffee place. Similarly, I wish all fast food went cashierless. The cashier is t…

I had a daily Starbucks habit before the pandemic. During the pandemic I just made pourover coffee at home with some half & half, and even now, eighteen months later and I'm doing more out in the world again, I only get Starbucks about once or twice a month.

It's not like it's hard to make okay coffee, it was mainly part of me being out and about.