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Labour market reallocation in the wake of Covid-19

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Re: Labour market reallocation in the wake of Covid-19

#11

Post by null_object »

Aqwis wrote: post #8
LatteLazy wrote: post #5

Maybe occasional shocks to the labour market would be a good policy going forwards. It seems a lot of people have suddenly found much better jobs just by being forced to look...

I work as a software developer in Norway. I've long had the impression that there are a lot of workers in my industry – particularly older people but not exclusively – who simply don't seem to care that much about their salary or total compensation package, don't put a lot of effort into salary negotiations and who tend to be happy with annual salary increases just above what's necessary to keep up with inflation. Go…

As a younger developer I certainly had an unrealistic idea of my value to the company's profitability which has attenuated to a more realistic assessment these days: maybe that's part of why "older developers" are satisfied with relatively lower salaries. It may also be to do with a healthy attitude to work/life balance: demanding a higher salary can correlate with greater demands on your time (including even weekend work).

My view is that competent developers can rise to the level of income they deserve, without sweating it too much that others with more experience are somehow keeping them back.

Re: Labour market reallocation in the wake of Covid-19

#12

Post by ilammy »

Aqwis wrote: post #8
LatteLazy wrote: post #5

Maybe occasional shocks to the labour market would be a good policy going forwards. It seems a lot of people have suddenly found much better jobs just by being forced to look...

I work as a software developer in Norway. I've long had the impression that there are a lot of workers in my industry – particularly older people but not exclusively – who simply don't seem to care that much about their salary or total compensation package, don't put a lot of effort into salary negotiations and who tend to be happy with annual salary increases just above what's necessary to keep up with inflation. Go…

Weirdly enough, your comment makes very much sense. But at the same time it reads like it would be nice from time to time to get a natural disaster here, economic crisis there, and a little war next door — just so that people know that they must always be ready to fight for something better rather than being content with what they have. Which also makes very much sense, in a way.

The gist of it seems to be the age old “problem” that older people are conservative and want stability while younger people want new things and to their own place in the world. It used to be solved naturally by older people dying and freeing up space, but recently society started progressing so much faster than before that people are not dying fast enough to “keep up” with the progress by taking their old and obsolete things, viewpoints and habits to the grave.

Re: Labour market reallocation in the wake of Covid-19

#13

Post by Aqwis »

null_object wrote: post #11
Aqwis wrote: post #8

Earlier quoted context omitted.

I work as a software developer in Norway. I've long had the impression that there are a lot of workers in my industry – particularly older people but not exclusively – who simply don't seem to care that much about their salary or total compensation package, don't put a lot of effort into salary negotiations and who tend to be happy with annual salary increases just above what's necessary to keep up with inflation. Go…

As a younger developer I certainly had an unrealistic idea of my value to the company's profitability which has attenuated to a more realistic assessment these days: maybe that's part of why "older developers" are satisfied with relatively lower salaries. It may also be to do with a healthy attitude to work/life balance: demanding a higher salary can correlate with greater demands on your time (including even weekend…

The point is that because of the mentioned factors, artificially little of companies' revenues flow to developers (in the form of wages or other compensation). If the general salary level of developers in the local market increased, then I believe that would happen without large sacrifices to workload or work/life-balance (many of which would be illegal under local laws anyway), because it would only make up for the salary level today being artifically low.

Re: Labour market reallocation in the wake of Covid-19

#14

Post by dalbasal »

bawolff wrote: post #4
dalbasal wrote: post #3

This seems right, but I think we're seeing how resilient the real economy is, given appropriate financing. It's almost always the financial/monetary side that's the problem. An economy can usually make more of stuff, or substitutes, and/or consume relatively painlessly. The pain kicks in when the financial sector feels pain. The real economy reshuffles if it's financed adequately. Monetary policy, currently, finds it…

> An economy can usually make more of stuff, or substitutes, and/or consume relatively painlessly. The pain kicks in when the financial sector feels pain. The real economy reshuffles if it's financed adequately Isn't money just an abstraction over resources? In essence i think you're saying that creating goods is not a problem assuming there are sufficient resources to make the goods and sufficient resources to compe…

"Isn't money just an abstraction over resources?"

I think the economics of money tends to compete on which common sense, to follow. Taken to the extreme, you could say that money doesn't matter. Only resources and the real economy matter.

That, IMO, is negated by the history of money economics affecting the real economy. Money shortage is a thing. If the economy hadn't been funded, the resource shuffling wouldn't have been possible... or more painful. People don't get compensated for resources and labour in exchange for goods and labour. They get compensated in money, which is at some point down the cascade, credit. If money is short, it doesn't matter what the productive capacity. That reshuffling doesn't happen smoothly.

So, no... I think. At least, not in a sense that commons sense implications can be applied. Money isn't just an abstraction over resources. It's a thing unto itself. Money supply issues, hyperinflation, financial shocks, credit shocks and have been more likely to affect major real economy problems than supply of actual stuff like oil. Oil shock is a thing. There definitely are real examples of crippling resource shortages. More often though, money supply is the issue.

Re: Labour market reallocation in the wake of Covid-19

#15

Post by Aqwis »

duggan wrote: post #10
Aqwis wrote: post #8

Earlier quoted context omitted.

I work as a software developer in Norway. I've long had the impression that there are a lot of workers in my industry – particularly older people but not exclusively – who simply don't seem to care that much about their salary or total compensation package, don't put a lot of effort into salary negotiations and who tend to be happy with annual salary increases just above what's necessary to keep up with inflation. Go…

If you think you're worth 120k to some company, you should find that company. Or found it.

I'm quite happy with my current salary – the problem is that I don't know anyone with my level of experience who earns more than me, and I'm certainly not the person among all my friends and acquaintances who provides the most value to his company. I've ended up where I am by spending a lot of time looking for jobs and being very selective, but it would be nice if the general salary level were higher so that more people could get paid according to the value they provide.

Re: Labour market reallocation in the wake of Covid-19

#16

Post by phreeza »

dalbasal wrote: post #3

This seems right, but I think we're seeing how resilient the real economy is, given appropriate financing. It's almost always the financial/monetary side that's the problem. An economy can usually make more of stuff, or substitutes, and/or consume relatively painlessly. The pain kicks in when the financial sector feels pain. The real economy reshuffles if it's financed adequately. Monetary policy, currently, finds it…

> It's almost always the financial/monetary side that's the problem.

How do you explain hyperinflation, where there is too much money chasing too few resources?

Re: Labour market reallocation in the wake of Covid-19

#17

Post by dalbasal »

refurb wrote: post #7
dalbasal wrote: post #3

This seems right, but I think we're seeing how resilient the real economy is, given appropriate financing. It's almost always the financial/monetary side that's the problem. An economy can usually make more of stuff, or substitutes, and/or consume relatively painlessly. The pain kicks in when the financial sector feels pain. The real economy reshuffles if it's financed adequately. Monetary policy, currently, finds it…

The financial aspects you mention has a cost - there is no free lunch. No doubt the financing is also causing some of the delay in efficient reallocation. But the piper must be paid in the end. Ideally it’s similar to 2008 where the govt unwound all the extra money, over time, relatively painlessly. Of course that’s not guaranteed at at all. If inflation gets out of control then you could see a major economic shock a…

"There is no free lunch" is like one of those religious quotes that can mean anything and its opposite.

What does "unwound all the extra money" mean? They didn't run surpluses, which means more money circulated out of the economy than in. That's why they were less reserved, this time, creating more of the stuff. They realised that it doesn't have to be paid back.

Re: Labour market reallocation in the wake of Covid-19

#18

Post by dalbasal »

phreeza wrote: post #16
dalbasal wrote: post #3

This seems right, but I think we're seeing how resilient the real economy is, given appropriate financing. It's almost always the financial/monetary side that's the problem. An economy can usually make more of stuff, or substitutes, and/or consume relatively painlessly. The pain kicks in when the financial sector feels pain. The real economy reshuffles if it's financed adequately. Monetary policy, currently, finds it…

> It's almost always the financial/monetary side that's the problem. How do you explain hyperinflation, where there is too much money chasing too few resources?

I didn't mean that money shortage is always the problem, that that has been often the notable case in recent experience. Hyperinflation is also a monetary/financial issue, too much money, not enough demand, crashing value.

I think the difference between inflation & hyperinflation is that "inflation" can be contained mostly within the real economy. Hyperinflation, has to have a macroeconomic, money supply related, explanation.

Lebanon's current mess, for eg, is more or less the consequence of letting Beirut banks do what stablecoin does, but the old fashioned way. High interest dollar accounts, backed by high interest Lira. Lira loans, backed by the same dollarized banking system. Dollars come in, and dollars are owed. Liras go out, and Liras are owed back. It works until the underlying currency bends. Liras come in. Dollars go out. A port explosion & widespread loss of confidence in the governing system are part of the story.

The upshot I'm driving for is that stuff happening entirely in the money markets causes determines goods flowing in and out of ports and fibre, not the other way around. It's not lebanon's ability to export goods that changed and killed its ability to import goods and resources. It's its inability to import dollars, and its ability to pay using Liras that collapsed first.

Re: Labour market reallocation in the wake of Covid-19

#19

Post by [deleted] »

phreeza wrote: post #16
dalbasal wrote: post #3

This seems right, but I think we're seeing how resilient the real economy is, given appropriate financing. It's almost always the financial/monetary side that's the problem. An economy can usually make more of stuff, or substitutes, and/or consume relatively painlessly. The pain kicks in when the financial sector feels pain. The real economy reshuffles if it's financed adequately. Monetary policy, currently, finds it…

> It's almost always the financial/monetary side that's the problem. How do you explain hyperinflation, where there is too much money chasing too few resources?

[deleted]

Re: Labour market reallocation in the wake of Covid-19

#20

Post by gruez »

refurb wrote: post #7
dalbasal wrote: post #3

This seems right, but I think we're seeing how resilient the real economy is, given appropriate financing. It's almost always the financial/monetary side that's the problem. An economy can usually make more of stuff, or substitutes, and/or consume relatively painlessly. The pain kicks in when the financial sector feels pain. The real economy reshuffles if it's financed adequately. Monetary policy, currently, finds it…

The financial aspects you mention has a cost - there is no free lunch. No doubt the financing is also causing some of the delay in efficient reallocation. But the piper must be paid in the end. Ideally it’s similar to 2008 where the govt unwound all the extra money, over time, relatively painlessly. Of course that’s not guaranteed at at all. If inflation gets out of control then you could see a major economic shock a…

> Ideally it’s similar to 2008 where the govt unwound all the extra money, over time

They did? https://www.federalreserve.gov/monetarypolicy/bst_recenttren...

We only started "unwinding" in 2018 and wasn't even close to undoing everything from 2008. Then the pandemic hit and all of that was undone.

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