undefined | Better HN

0 pointszamfi3y ago0 comments

> If there also is a large profit margin the desire to keep wages down is more of a fetish than the sensible choice it is at the other end of the spectrum.

I'm consistently surprised by misunderstandings of supply and demand.

There is a labor market. It's relatively free, all things considered. Sometimes companies conspire to keep prices down (see: high tech antitrust lawsuit/settlement) but usually the thing that keeps wages low isn't business owner collusion it's the availability of workers accepting work with a low wage.

Sure, all things being equal business owners would like to pay less for labor. They'd also like to pay less rent, less for insurance, lower taxes, etc. And sometimes they want to pay less than anyone is willing to accept, and sometimes instead of raising wages they rant about it on Twitter or in opinion pieces or whatever.

But that doesn't get them employees!

0 comments

Jiro3y ago

>usually the thing that keeps wages low isn't business owner collusion it's the availability of workers accepting work with a low wage.

But if you have a labor shortage and low wages at the same time, that means that workers accepting work with a low wage aren't available, but the employers are keeping wages low anyway. (And in this context, poor working conditions amount to "low wages" because they decrease the value of the job to the employee.)

In capitalism, "labor shortage" means "the employers had better pay their employees more, or else they won't have the employees to compete against other employers who will pay more".

zamfiOP3y ago

I don't think we disagree, but what you describe is not necessarily a result of collusion -- maybe the business just doesn't work with higher-paid workers (i.e., product costs more than market is willing to pay) and scales with number of workers, in which case the owner might take whatever workers they can get at cost X, but can't hire any at cost X+1.

Only a profit-averse business owner would turn away revenue-exceeding-costs work merely because it involves paying workers more -- that business will likely not last super long unless there are special circumstances in play.

j / k navigate · click thread line to collapse