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Labor shortage or terrible jobs?

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Re: Labor shortage or terrible jobs?

#961

Post by ab111111111 »

inglor_cz wrote: post #869
ab111111111 wrote: post #863

Earlier quoted context omitted.

The whole point of a minimum wage increase is that it will increase all restaurants' wage costs to the same degree, at the same time. Meaning that going "down the street", potential diner's will find that all restaurants' prices have increased equally. So the business threat isn't that American consumers will abandon "Dale's" in particular for some other restaurant. It's that they will choose to eat at home instead o…

"it will increase all restaurants' wage costs to the same degree" 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.

Isn't that already the case, though? There's already a minimum wage in the US. The debate is about increasing the minimum wage, not creating one.

Re: Labor shortage or terrible jobs?

#962

Post by chii »

shkkmo wrote: post #958
chii wrote: post #695

Earlier quoted context omitted.

> one that is orthogonal to the one solved by minimum wage or basic income. no it isn't orthogonal - UBI and minimum is based on the premise that there exists people who would not be able to produce value that is enough to sustain themselves (aka, they consume more resources than they produce), and thus need the rest of society to pick up that slack (otherwise, they'd just die). I'm saying that people would always be…

That is not the premise on which UBI is built. If I had to pick just one it would be that we have more productive capacity than we need, so threatening people with death (your words) to be productive is no longer necessary.

> we have more productive capacity than we need

i'm not convinced that this is true, except with very basic necessities like food and water, and even then, those require a lot of energy to produce, and those aren't free yet since science hasn't discovered cheap or free energy yet.

Re: Labor shortage or terrible jobs?

#963

Post by selestify »

AJ007 wrote: post #813
leesalminen wrote: post #693

Earlier quoted context omitted.

> [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. I agree with you, I would nev…

10% is when the restaurant is extremely successful. Average margins are lower than that. Arguably there are way too many restaurants, in part due to low interest rates. If there were fewer restaurants, the volume would go up and the average restaurant would do a larger gross and be able to handle low or lower margins. Consider that if someone lived through the last time the US had significant price inflation as an ad…

How does significant price inflation change investing/business strategies?

Re: Labor shortage or terrible jobs?

#964

Post by etrabroline »

seanmcdirmid wrote: post #668
thepasswordis wrote: post #662

The problem that is never addressed in these "terrible job" "terrible wage. wages too low" stories is: 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…

Being single more workable (it’s easy to control spending) than having dependents (kids). Once you have a kid or two, your expenses become less predictable and things begin to pile up (literally, a larger house becomes a necessity rather than just a luxury). I see many people putting off kids or just opting out completely because COL increases have just made them too risky.

Have you heard of The Origin of Species by Charles Darwin?

Re: Labor shortage or terrible jobs?

#965

Post by AnthonyMouse »

dmitriid wrote: post #750
AnthonyMouse wrote: post #574

Earlier quoted context omitted.

> Yeah but the job market is not a free market, because not getting a job is existential for those seeking the job, while the company can usually just survive when a position is not filled for a certain time. This is, to begin with, not true. It's common for small businesses to be operating at the margin. If you don't have someone making the sandwiches then you don't have revenue and you still have rent and utilities…

> This is, to begin with, not true. I will never stop being amazed at how Americans argue that something decent is wrong, or untrue, or even impossible... when Europe exists.

> I will never stop being amazed at how Americans argue that something decent is wrong, or untrue, or even impossible... when Europe exists.

In Europe there are zero businesses operating at the margin that would go under if unable to staff their operation? That was the thing you are responding to.

Re: Labor shortage or terrible jobs?

#966

Post by Noumenon72 »

Jweb_Guru wrote: post #898
Noumenon72 wrote: post #784

Earlier quoted context omitted.

I view the government as setting up a playing field which entrepreneurs than explore to find profit opportunities. With welfare and especially the Earned Income Tax Credit, the government created a class of people who can be profitably employed by paying $X below the cost of living. This was intentional, a way to keep people in the market economy even though they're not productive enough to survive in current conditi…

The subsidies in this case do not exist so that businesses can exploit underpaid workers, though (and are not comparable to something like a rent-controlled apartment, where landlords are just prevented from charging so much that they'll drive out the workforce rather than actively subsidizing with things like food stamps or welfare). They exist because the US is reluctant to let people starve in the streets and die,…

Employment is an explicit goal of the US welfare system. It's not supposed to keep you from starving if you don't work. That's why you are limited to three months of food stamps every three years unless you are working.

I do see rent control as directly comparable. Government observes a matrix of incomes and prices determined by self-interest in a market economy. Government determines some are not politically acceptable and modifies them. Now the military pays better than before, NYC rent is cheaper, and low-wage workers are more able to survive. Now people build businesses around contracting for the military, living in NYC, and hiring low-wage workers. If government later changes the payoffs to these activities, it's not the businesses' fault for relying on the prices the government set. Government set those prices to enable those businesses.

Re: Labor shortage or terrible jobs?

#967

Post by shkkmo »

chii wrote: post #962
shkkmo wrote: post #958

Earlier quoted context omitted.

That is not the premise on which UBI is built. If I had to pick just one it would be that we have more productive capacity than we need, so threatening people with death (your words) to be productive is no longer necessary.

> we have more productive capacity than we need i'm not convinced that this is true, except with very basic necessities like food and water, and even then, those require a lot of energy to produce, and those aren't free yet since science hasn't discovered cheap or free energy yet.

We have distribution and allocation problems, but we definitely have sufficient productive capacity to provide a reasonable standard of living.

Even if you pick a standard of living that makes this premise not true, this is still the primary motivating premise for UBI. This is why UBI is so closely linked with the rise of Automation to a point where there simply won't be enough jobs to retrain people to do.

Re: Labor shortage or terrible jobs?

#968

Post by dmitriid »

AnthonyMouse wrote: post #965
dmitriid wrote: post #750

Earlier quoted context omitted.

> This is, to begin with, not true. I will never stop being amazed at how Americans argue that something decent is wrong, or untrue, or even impossible... when Europe exists.

> I will never stop being amazed at how Americans argue that something decent is wrong, or untrue, or even impossible... when Europe exists. In Europe there are zero businesses operating at the margin that would go under if unable to staff their operation? That was the thing you are responding to.

The thing I was responding to was, "we can't raise the minimum wage because if we do businesses will go under"

Well, Europe did raise minimum wages. Undoubtedly, some businesses did go under when that happened... So what?

Did business cease to exist in Europe?

Re: Labor shortage or terrible jobs?

#969

Post by 11235813213455 »

jschveibinz wrote: post #2

This article unfortunately doesn't address the business side of the problem. Fast food restaurants, or place like "Dale's" mentioned in the article, make very little profit. It is most likely below 10%. Here is an estimate: https://www.restaurant365.com/blog/what-is-the-average-profi... . 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 al…

It would be somewhat a good thing that jobs/services with very little added value like fast food (or even a somewhat negative value) make little margins/profits. We are really way too much in a society of consumption, there are many intermediate and unnecessary jobs and services, and those are the first hit during a crisis

Re: Labor shortage or terrible jobs?

#970

Post by anovikov »

jsdwarf wrote: post #891
nikanj wrote: post #877

Earlier quoted context omitted.

That’s an excellent question, and touches many other avenues of life too. Why bother with producing anything, when asset appreciation provides bigger gains with no effort needed

Because your activity contributes to the appreciation. A good restaurant attracts a lot of people, which in turn attracts other businesses (think of bookstores next to popular cafés). This increases the worth of the property.

That's true, while that's not what i meant to say. I just pointed out that business doesn't work on appreciation alone, and restaurants nearly always rent their places anyway, and that it is extremely extremely difficult to make ends meet operating a restaurant while avoiding getting to madhouse.
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