And this brings us to the main point. The claim that if wages go up, jobs go down isn’t a description of reality at all. Nor, in my opinion, does it reflect legitimate economics. It is a negotiating strategy. It is a scam, a con job, a threat — more precisely, it is an intimidation tactic masquerading as a legitimate economic theory. I believe this is where being a businessperson and not an economist leads to greater clarity. Very few economists have ever run a business or negotiated wages. But the first rule in the businessman’s handbook on wage negotiation and suppression is always, always when they ask for a raise, threaten their jobs. It works like a charm and has since the invention of capitalism. You see, the claim if wages go up, employment goes down isn’t made because it is true. It’s made because if people like me can get people like you to believe it is true, I’m going to get richer, and you are going to get poorer. The lower your wages are the higher my profits will be. It’s that simple.
Nick Hanauer, “The claim that if wages go up, jobs will go down is not a theory — it’s a scam” (via yamelcakes)
wages are lower in america than they’ve been in decades. so where’s all the jobs?
(via gaydognerd)
The lower your wages are the higher my profits will be.
And that, too, is also a fallacy. There’s a point at which employers are shooting themselves in the foot if they keep dicking their employees around. Walmart is a classic example. Hire only part timers so you don’t have to give benefits. Lowest wages in the industry. Cut the costs associated with its employees as much as you can in service of this idea that lower wages leads to higher profits. This is what drives me nuts about amateur, arm-chair economists. They keep thinking in simple 1 to 1 relationships about complex human behavior. But the way it works out is that if you don’t invest anything in your employees? Guess what? They don’t invest anything in you either.
Saw this on the New York Times today. Could it be possible that Walmart has learned its lesson? Never thought I’d see this in my lifetime. How Did Walmart Get Cleaner Stores and Higher Sales? It Paid Its People More
Hearseeno 