General Category > Economy/Business

Chicago workers strike over wages at Macy’s to McDonald’s

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jmyrlefuller:
First off, they need to understand that labor is a commodity. Its value goes up and down on the market based on supply and demand. A worker cannot simply demand his work is worth $15 an hour because he wants it to be any more than a farmer demand his milk is worth $5 a gallon because he wants it to be. If no one is willing to buy, he has to bring his price down or get out of the business. The market for labor is crap right now and has been for the past five years.

Part of the reason for that is because labor is not as valuable as it used to be. Automation, offshoring, and other less expensive solutions reduce the need for it, and government efforts to prop up the price of labor (such as the minimum wage and the looming Obamacare employer mandate) put American labor at a distinct disadvantage to these lower-cost solutions. Efforts to try and move more people into white-collar, college-educated careers have created a glut in labor supply in those fields as well, which creates an especially troubling situation given the mass amount of upfront investment required to enter those fields. Those fields were never intended to house the majority of American workers.

Second, in order for labor to be valuable, it has to be worthwhile to the employer so that he does not lose money. In order for a company to want to pay an employee $15 an hour, he has to be sure that the employee can bring in enough money to make up that $15 an hour in extra sales, and on a consistent basis. In retail, that is not always possible.

I would suggest to these city workers to go out into the rural farm areas and start working on the farms. It's hard work, but the cost of living is far less out there, and as long as there are mouths to feed, there will always be a need to grow the food to feed those mouths. Every American we can put to work there will reduce our need for foreign labor.

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