Comments
addctd2badideas t1_jaaohnp wrote
Either pay more or pay the current rate and train people who don't yet have the skills and then make sure there's an upward sliding scale for their salary once they're trained.
roccoccoSafredi OP t1_jaaxdh6 wrote
It's impossible to "just pay people more". That creates a wage and price spiral that wipes out the gains from increased pay.
The option exists to convince employers to lower their margins, but that requires completely rewiring our entire economic system. That's never turned out well.
Capitalism: it's the worst economic system except for all the others.
okdiluted t1_jab68ex wrote
it's extremely possible to do this in a system where there's never been a larger disparity between the income of hourly workers and the income of owners/managers. they'll cry poverty if they can't buy a third vacation home while skilled workers are struggling to find a job that won't break their bodies and will still let them pay rent. add that into the refusal to invest in training or entry-level jobs for newer/younger workers and you've got a labor force that's retiring/dying out and no new takers because people have bills to pay and don't want to be treated like they're disposable. i'm a skilled tradesman and i deal with this as my day to day reality. places are desperate for skilled workers but won't pay us enough to live on, they'll brag about record profits but deny us raises because of "the economy", they overwork what small labor force they do have so we're all even more overextended and prone to injury while they refuse to hire or train up new people, and that penny wise dollar foolish attitude is gonna end up hurting them even more than it hurts us when that unsustainable cycle finally catches up to them.
MotoSlashSix t1_jaco6d3 wrote
So, first of all this claim about "wage price spiral" is a myth debunked by multiple economists who cover the topic.
What's funny about your claim is, folks who say similar things never point to C-Suite/Executive compensation as part of some "wage price spiral" or talk about how much stock buy backs contribute to lack of re-investment which can affect consumer prices and reduce employment compensation.
One doesn't have to touch margins to address executive compensation. That doesn't require re-wiring an entire economic system.And placing regulatory restrictions on stock buy backs does not require "re-wiring" an entire economic system.
macgyversstuntdouble t1_jadimyo wrote
"Debunked" - yet your first link literally describes it as a valid condition.
> And if, say, 10% is the headline number for the increase in pay, then 10% is an excellent focal point for price increases, even though overall costs haven’t risen that much. So prices may rise just as much as pay, sending the wage-price spiral into overdrive.
Your second article talks more about how it isn't ethical for workers to sacrifice themselves to stop inflation (inherently agreeing that the wage price spiral is real), and the third article is more of that. These aren't debunking the wage price spiral. They are just saying it isn't the most important thing out there.
The wage-price spiral is real. It isn't the only thing driving inflation, but it is driving inflation. We've literally seen this. It isn't a debate. Wages go up, prices go up (because the employer isn't eating those costs: it's passing them on to the consumer). Then wages go up to match the prices that went up. Hello 1970s and 1980s. Eventually it stopped so it isn't an infinite spiral (no duh!) - but the impact is tangible and real, and history shows it clearly.
Putting absolute knowledge into a bunch of economists is foolhardy. How many economists were agreeing with Jay Powell that inflation was "transitory" in 2021? No large scale mass of PhDs contested it. They largely agreed with him! Yet they were all wrong.
It sucks, but something has to break in the next few years. Asset prices, interest rates, employment, wages, government deficit spending, dollar strength, international markets - something has to give. Inflation won't until there is actual pain to stop it.
MotoSlashSix t1_jae9ow7 wrote
>yet your first link literally describes it as a valid condition.
Being a "valid condition" and claiming those wage increases are the primary driver of a price increase "spiral" is not the same thing. So claiming that increasing wages will cause price increase spirals is nonsense.
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>Given the paths of prices and pay in the past year, I believe these concerns are probably overblown. And one reason is simple math. Labor isn’t the only input into most goods and services. When the cost of labor increases, the costs of the other inputs don’t necessarily change. So the overall cost of producing a good or service doesn’t increase as much as the cost of labor alone.
Or to put it another way, this is part of what your analysis left out:
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>Worrying about wage‐to‐price passthrough after a period of excessively expansionary policy is therefore akin to lamenting gravity as the cause of hurtling to the ground after someone has thrown you from a plane. Encouraged by politicians such as Johnson, the wage‐spiral concept encourages businesses and workers to blame each other, mistaking the consequences of inflation for its origins.
macgyversstuntdouble t1_jaeezpn wrote
> When the cost of labor increases, the costs of the other inputs don’t necessarily change. So the overall cost of producing a good or service doesn’t increase as much as the cost of labor alone.
So everyone can get an 8% raise this year, and the people who own those companies will also get their 8% increase in profits too (aka their wages). And that won't increase inflation! Brilliant! /s
You see - this is what broad increases in wages do. They increase the cost of doing business. The Fed is trying to curb that by cooling the economy, but we've got a shit-ton of economic momentum going forward and it's hard to stop a train that Congress shoves a trillion dollars in new spending every year.
If you think that wages are not correlated to prices, you are dumb. I think you understand that there is a wage price correlation (as all your papers state), but you instead contend that there is instead something bigger driving inflation. That may be true - but wages are sticky.
Your boss doesn't tell you "Prices have come down on goods, so you get a 6% decrease in wages". However, we expect "prices are up 8%, here's your 8% increase in wages". One of these is sticky, and it's why many are pushing for wages to lag more. It sucks, but it's real.
In no way is the wage price spiral "debunked" by your articles. It exists. They agree the correlation exists. The only question is: is the wage increase broad or narrow. It is clearly broad right now, and that makes inflation itself stickier, which is inevitably bad.
RadicalSidewalks t1_jab9cs6 wrote
Got it! Strategy: continue to blame the million+ workers rather than the hundreds of executives (and by proxy, policy makers) who prioritize year over year profit margins above all else
roccoccoSafredi OP t1_jaba9sy wrote
Policy makers, absolutely.
Everyone else is just a cog in the system though.
Public companies have to have their stock prices go up. If they don't investors will put their money into companies who's stock prices do.
All those other people: CEOs, managers, etc... If they don't help do that, they're gonna get replaced with people who do.
It's an ugly system, but it's the best we've come up with.
RadicalSidewalks t1_jabc5ue wrote
So what’s your base argument here? You clearly understand that capital owners will do anything in their power to acquire more capital, pay workers bargain basement wages, and (legally and illegally) snuff out unionization. So we mustn’t make reforms that system but rather…….what? Tell workers to pull themselves up by their bootstraps?
roccoccoSafredi OP t1_jabcrer wrote
I'm not really sure what the solution is. But I know the problem isn't "there are no jobs".
It's impossible to solve the problem when we don't understand it though.
S-Kunst t1_jac0rcw wrote
Paying people more who have no skills, in these areas, is wasting money. Its great when a person makes the attempt to learn, but most come to the job with no foundational training. All their education was in a liberal arts curriculum, which is not universally helpful.
todareistobmore t1_jab5tb9 wrote
There wouldn't be a shortage of construction workers if they wanted to hire unionized employees, or there weren't a crackdown on immigration, or there hadn't been a collapse in the construction industry between 2008 and oh, about 2021.
umbligado t1_jad5mj3 wrote
Part of the problem includes diminished funding for and interest in technical training at the high school level, which has been happening since the 1990s.
roccoccoSafredi OP t1_jaawqts wrote
Ok. So lets play that out.
Pay those folks more, sure, but then... suddenly the cost of building anything goes up 100%. Because this is the real world and you know that builders aren't to take that out of their margin.
And suddenly, even though those construction workers are making $100k, they still can't afford to buy a house.
engin__r t1_jaax1x9 wrote
If we’re going to live in the real world, we should stop indulging the business owners who want everyone to pretend that no one wants to work first. They’re just out to complain. If they want to fix the problem, they have the ability to pay more.
ConcreteThinking t1_jacgeni wrote
I know you are probably generalizing/exaggerating, but an increase in the cost of labor wouldn't result in a 100% increase in cost. If wages went up by 25% and labor is around 20% of project cost then the overall increase would be 5%, not 100%.
MotoSlashSix t1_jacos79 wrote
This is absolutely not how labor price increases work in the real world.
S-Kunst t1_jac0kka wrote
Paying more is not a universal answer. Yes, pay competitive wage, but the number of young people I have had to try and train shows that little or no previous training in the basics of technical or mechanical topics, leaves a person sorely lacking. Most of the kids I have tried to train have no hands-on background. Not like the old days when most boys had their hands on repairing a car. Many of these skills are transferable. Understanding how to take things apart and put them back together is not taught in our schools. When I hear a trainee ask for a "flat head screwdriver" I know I am in trouble, as they have no training in the basics.
ThoughtCollection t1_jaa8057 wrote
This article says a lot about the volume of jobs, but little about those job’s salaries or barriers preventing people from accessing the roles (training/education/transportation). All in a pretty useless article
roccoccoSafredi OP t1_jaaxiap wrote
I'm sure you could find the answers if you looked.
It's a political news site. They're not going to give you a deep dive.
roccoccoSafredi OP t1_jaa48wa wrote
I'm sharing this because it demonstrates a point I've been making to folks for a while. Baltimore's poverty issues do not come from a lack of "jobs".
They come from a basic skills gap.
todareistobmore t1_jab5omk wrote
> Baltimore's poverty issues do not come from a lack of "jobs"
This is such a colossal straw man given that the situation in the labor market described in this article is at most two years old.
> They come from a basic skills gap.
To the extent this is true, it's best exemplified by this article quoting McKinsey about vaporware labor needs beyond the near future.
jabbadarth t1_jaa4rg4 wrote
That and access to the jobs.
roccoccoSafredi OP t1_jaaxram wrote
You know people used to move across the country for employment, right?
Hell, I work with a shitload of people who have moved half way around the world for better employment.
People are clever: they can figure shit like that out when they need to.
MotoSlashSix t1_jacpd76 wrote
Yeah man, all the folks in Baltimore who are struggling from lack of work need to do is take that few thousands bucks they have in savings, move to Austin Texas, put down a few grand for a deposit and first months rent on the average place there, pull their kids out of school, and start working in one of those awesome tech sector jobs!
MotoSlashSix t1_jacpopk wrote
I guess I just figured people here are smart enough to understand that part of the whole "lack of jobs" thing is the fact the city lacks jobs people can actually get hired for and live on.
Implicit in the "lack of jobs" argument is the need to train people for the jobs we do have. And that requires investment beyond the means of your average individual who is struggling from underemployment. That need exists regardless of how much you pay people.
You have to meet people where they are. An overabundance of jobs writing cursive doesn't matter if 99% of the population doesn't know how to write cursive. So train people in how to do that. The problem is, most people can't afford the kinds of training required to do these jobs. And if we're being honest, the argument is more holistic than just "more jobs." It includes the need to get people training and support them while they learn.
And also let's don't pretend that some $15/hour service sector job that puts someone on a bus 4 hours a day in addition to their shift is sufficient and will support someone in this city.
EfficiencySuch6361 t1_jaa6zw5 wrote
Why would anyone anywhere care about ur opinion?
NotARageComic t1_jaabh5c wrote
Thank you, this subreddit needs more negativity like this!
EfficiencySuch6361 t1_jaacmpl wrote
Bc blaming poor underserved communities 100% for their problems like OP is just the epitome of positivity! s/
okdiluted t1_jab6hyw wrote
for real. this has major "the shop manager just stepped out of his new car to tell everyone the company's making record profits this year! not for you guys on the floor though, you know how bad the economy is, we just can't find the money to give any raises."
S-Kunst t1_jac02ln wrote
The climate for the past 35 yrs+ has been college college college is the only way you will be happy at work and get a high pay check. Vocational programs were cut, when the college high priests got to the school systems and sold them on a cheaper way to run a school. Have all students take the same chalk talk programs, and say they will go to elite colleges. This cut the need for small class technical programs.
The company I work for has been looking for welders for several years. We get a few,applicants, but most do not understand that its not a cushy office job. The complaining is very annoying. None have any experience or even outside interest in hands-on work. This leaves them with no assets for this type of work. A liberal arts education is not a universally useful curriculum. And taking a late teenager and trying to educate them in the ways of construction or other technical careers, is near impossible if they have had no earlier training. I bet no college will take on a kid, in their basket ball or football program who has never played ball before.
DudleyAndStephens t1_jacf68j wrote
I can't believe this is being downvoted. Too many people in the US are getting college degrees that cost a lot but have marginal real world value. I know that jobs in the trades have a lot of drawbacks but knowing how to repair an HVAC system is a lot more valuable than a Communications degree from a third rate college.
[deleted] t1_jaaj3eh wrote
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engin__r t1_jaai74w wrote
People are still writing these articles? It's simple, pay more and you'll get more applications. There wouldn't be a shortage of construction workers if the job paid $100k a year.