Yves here. Glad to see someone is calling out the Republican “You need to keep them hungry so they’ll turn up” approach to labor management. Corporate profit share of GDP has been record highs for years, which means nearly two times the level Warren Buffett deemed to be unsustainably high in the early 2000s. Time for corporate owners to pay a decent wage.
By Kenny Stancil, staff writer at Common Dreams. Originally published at Common Dreams
Pushing back on the right-wing narrative about the reason for real or perceived labor shortages in some markets nationwide, progressives on Friday told corporations that if they want to hire more people, they’ll need to start paying better wages.
Soon after the Labor Department released its April jobs report, the U.S. Chamber of Congress blamed last month’s weak employment growth on the existence of a $300 weekly supplemental jobless benefit and began urging lawmakers to eliminate the federally enhanced unemployment payments that were extended through early September when congressional Democrats passed President Joe Biden’s American Rescue Plan.
“No. We don’t need to end [the additional] $300 a week in emergency unemployment benefits that workers desperately need,” Sen. Bernie Sanders (I-Vt.) saidin response to the grumbles of the nation’s largest business lobbying group. “We need to end starvation wages in America.”
“If $300 a week is preventing employers from hiring low-wage workers there’s a simple solution,” Sanders added. “Raise your wages. Pay decent benefits.”
According to the Chamber’s analysis, the extra $300 unemployment insurance (UI) benefit results in roughly one in four recipients taking home more pay than they earned working.
In response to that claim, Sanders’ staff director Warren Gunnelssaid: “If one in four recipients are making more off unemployment than they did working, that’s not an indictment of $300 a week in UI benefits. It’s an indictment of corporations paying starvation wages.”
“Raise your wages and benefits or flip your own damn burgers and sweep your own damn floors,” Gunnels added.
Other progressives like former labor secretary Robert Reich and Rep. Alexandria Ocasio-Cortez (D-N.Y.) also chimed in.
This is not complicated. If you can’t afford to pay your employees a living wage, you do not have a viable business model.
— Robert Reich (@RBReich) May 7, 2021
Fun fact: the US Chamber of Commerce is a secretive business lobby that supported a $3M effort to primary me out of office last year bc I stand up to Wall Street. (They lost ?) Wal-mart was outed as a secret client.
If UI > wages, the solution is to actually pay a living wage. https://t.co/04C2pCEZsY
— Alexandria Ocasio-Cortez (@AOC) May 7, 2021
“We do not have a shortage of willing workers in this country,” Morris Pearl of the Patriotic Millionaires said in a Friday afternoon statement responding to the Chamber. “We have a shortage of employers who are willing to pay workers enough to live.”
“Claiming that today’s disappointing jobs report is a result of expanded unemployment insurance is nothing more than a cruel tactic to pressure the administration into helping companies that they represent to continue to underpay and exploit their workforce,” Pearl continued. “Our leaders are supposed to be helping to increase wages for low paid workers, not helping employers to keep wages down.”
“Instead of blaming struggling workers,” Pearl continued, “large corporations that do not pay their employees a liveable wage… should take this moment to self-reflect. Maybe—just maybe—paying their workers more than starvation wages would incentivize workers to reenter the workforce.”
Writing for Jacobinearlier this week, Sandy Barnard noted that another overlooked factor is the increased morbidity rates among food and agricultural workers, which increased more than any other occupation during the Covid-19 pandemic, according to a recent study from the University of California–San Francisco.
“Living, breathing people… have decided they do not want to risk their lives for $7.25 per hour and no health benefits,” Barnard wrote.
Rep. Ilhan Omar (D-Minn.) responded to the Chamber’s call for an end to enhanced unemployment benefits by arguing that “the interests of big business are at war with the interests of the working class.”
“They will spend millions of dollars to take $300 a [week] away from you and your family, to force you to work for them for pennies,” she added. “Their greed has no bounds.”
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> “They will spend millions of dollars to take $300 a [week] away from you and your family, to force you to work for them for pennies,” she added. “Their greed has no bounds.”
MBA’s have done a cost benefit analysis and conclude this is the most profitable thing to do. It is accounting 101.
Robert Reich is full of shit.
Amazon pays a dieing wage and Walmart is not far behind. After JPow shoves money into every orfice Mr Market has, they are priced in the trillions.
God, I really hate Reich. Posturing buffoon.
I remember when my mom used to bring me to the Walmart super center when I was a kid, around 1990. They were exploding in popularity. The cheap goods were a blessing for our growing family. But we all know how the goods got so cheap.
The 1990s for Walmart was the equivalent of the 2010’s for Amazon. The low wage job model worked for them then and continues to work for them now.
And in the 1990s, Reich was running around being Labor Secretary, of all things.
There’s some simple solutions to this, like strengthening collective bargaining, but that’s nowhere in sight.
Employers will pay the lowest possible wage until they absolutely need to.
He quit after the first term and wrote a book about how frustrated he was by Clinton’s refusal to address widening income disparity and labor issues.
https://www.google.com/amp/s/www.chicagotribune.com/news/ct-xpm-1997-05-15-9705150278-story,amp.html (1997 book review which discusses his anger at Clinton and his failures)
Totally agree with your point about labor markets. But, Just because he wasn’t successful doesn’t mean he didn’t try. Correct me if I’m wrong (I often am) but I don’t think he’s the villain. Seems to have been trying to do good in whatever way he can and is also very open about the corruption and greed that makes change so difficult.
Fair enough, maybe I don’t give him enough credit. But he’s rested on the laurels of being in DC ever since, and spilled buckets of ink in pursuit of… not much.
I feel like his talking head routine has gotten pretty stale considering the state of the America worker today. He’s acted much like any other democrat operative. He supported sanders, but then shifted right to whatever candidate was running.
I’m just kind of tired of hearing from him and that tweet was, in particular, a disaster. The problem is that what he describes IS a business model. It’s reality.
The real tell is how Reich has lots of harsh words for meanie Republicans, but gets quiet about Democrats.
By comparison, someone like jeffrey sachs showed real courage endorsing bernie and ripping hillary’s foreign policy record during the height of the primary.
Good point. My rule of thumb. after 69 years in the US, if there is any hint of favoritism for corporate republican or corporate Democrat ways, don’t waste your time reading it.
Cocoman, Walmart wasn’t always the villain. When Sam Walton was still managing the company, he made a serious effort with his “Buy American “ campaign.
You don’t have to buy into the hagiography, but in 1990 there were a lot of American made goods in Walmart.
In the early 90s there was still a lot of manufacturing in the US which could support a campaign like this. The mills in the Carolinas were still operational for example. There were still a lot of small appliances (toasters, mixers, microwaves) and electronics (TVs, receivers) manufactured in the US.
This is all gone now, thanks to a bipartisan political effort to maximize profit for the shareholders of the multinational corporations.
More like tripartisan — both sides of the aisle along with the corporate oligarch class that profited by offshoring America’s productive capacity at the expense of their fellow citizens in the working classes. You can put Sam Walton and his brood among the oligarchs — I don’t see anything “buy America” about their relentless squeeze of suppliers …
Neat, did not know about that! Thanks.
Sounds like Walmart might be the classic case of slide into barbarism after the Founder syndrome was resolved.
I couldn’t read the article you linked, Taurus, but here’s a competing view (I think). I remember when it was discovered that Walton’s “Buy American” campaign was full of smoke and mirrors. From the article:
“Even as Wal-Mart was pushing its U.S. suppliers to be more efficient and promoting its “Buy American” program through the ’80s, the company bought more and more from Asia, according to Jay Moates, a former accountant with Wal-Mart’s overseas buying operation.
“But to please American consumers concerned about the Asian threat, the retailer played down its buying operations in Hong Kong, Taiwan, Korea, and the rest of Asia. Following the brutal suppression of Chinese students in Tiananmen Square in 1989 by the Chinese Communist leadership, Walton feared a consumer backlash if Wal-Mart were seen as operating in China. He was also disturbed by charges of human rights abuses in his Asian suppliers’ factories.
“To continue growing in Asia, Wal-Mart needed a buffer — a middleman or a buying agency that would purchase Asian products without showing Wal-Mart’s hand. According to the retired Hong Kong senior executive, Walton told Bill Fields, Wal-Mart’s head buyer, that he wanted to “get out” of direct involvement in Asia. “The decision was to go to an exclusive buying agency,” the buyer said. “The main reason for going into [the deal] was not to be exposed as going into Communist China.”
https://www.pbs.org/wgbh/pages/frontline/shows/walmart/secrets/wmchina.html
We can either blame Asia for this or we can blame our own upper class who engineered the Free Trade regime designed to make this possible.
It was the American upper class which sought to build up Asia as an economic-production-aggression platform to destroy the American economy with. And of course the Canadian upper class too. Mulroney was right up there with Reagan and Salinas de Gorari in conspiring to create NAFTA, for example.
“we can blame our own upper class who engineered the Free Trade regime designed to make this possible”
Yup. That’s who I blame.
Thank you. Some of us have always argued here that Walmart is the symptom (of a declining industrial America), not the disease.
RE: those small appliances in the 90s
Friend of mine’s father was an aquatic injuries lawyer – the kind of guy who would sue your waterfront property if someone got hurt in the surf and you hadn’t put up a sign mentioning the ocean has waves in it. He did quite well in that line of work and retired fairly early, however his stock portfolio was a little too heavy in Sunbeam, a once successful small appliance maker driven into the ground by corporate mismanagement, culminating with the massive fraud of Al “Chainsaw” Dunlap. Dunlap’s nickname came from his propensity for firing all the employees at the companies he was hired to run.
Can’t say I feel all that bad about my friend’s father having to go back to work once Sunbeam’s stock tanked, but it would be nice if we still made things in the US, and paid people well to do it. Just checked my cheap Oster coffeemaker (a Sunbeam affiliated brand) and as suspected, it’s made in China.
I think I paid $20-30 for my coffeemaker. I would gladly pay double that for one a little more durable manufactured with less plastic in the US. Corporate management and their actuaries clearly believe I’m in the minority with that belief.
Consumer electronics has nosedived in quality over the last couple of decades. Watch this YT video by Techmoan showing a Sony mini hifi system from about 1993 – it’s made with care and quality even though most of it’s built in China.
It’s not China itself that’s to blame but capitalism: we demand ever-lower prices and something has to give. Wages in China won’t be getting any worse, I suspect they’re rising, so components are skimped on and the result is devices that operate poorly and stop working after a year or two, no matter how carefully we look after them.
I’m in total agreement. But, I’d like to take this opportunity to examine a phrase we’ve all become used to, “we demand ever-lower prices…” I think this is a verbal end run for those responsible for the offshoring. Actual US wage purchasing power has declined for decades, and there would be no way to maintain the “consumer” oriented society without a corresponding decline in the cost for that which we are supposed to consume. The American public never heard an argument expressing the pros and cons of offshoring manufacturing to lower wage countries and how that would lower costs for goods, but that it would also destroy American jobs. Instead, we were listening nightly to how bad ole Bill was to that nice young lady. And, of course, we were happy to buy those same goods at the lower costs. But perhaps a little work on this common phrase is in order. Something like: “The loss of wage earners’ purchasing power required the lower cost of foreign made goods to maintain the illusion of the consumer oriented society.” Or, something like that.
But, I’d like to take this opportunity to examine a phrase we’ve all become used to, “we demand ever-lower prices…” I think this is a verbal end run for those responsible for the offshoring.
Agreed. Most of the public were slowly trained to accept that prices could in fact be lower and lower without any negative consequences.
The American public never heard an argument expressing the pros and cons of offshoring manufacturing to lower wage countries and how that would lower costs for goods, but that it would also destroy American jobs.
The public are never given an opportunity to publicly debate any of the modern technologies that are foisted on them. Jerry Mander has pointed out that the potential societal downsides of – for example, both television and automobiles – had been extensively studied and were well known. But only the positive aspects were marketed to the public.
If a true democratic debate had occurred, the public at large may have decided they didn’t want to pave over most of the country, become dependent on foreign oil and oil in general, increase policing powers, create mass suburbia, etc. – all of which were predicted by those in the know. Perhaps the public may have decided to go ahead anyway in the interest of personal freedom and quicker travel times, etc. But the point is we never had the debate. We never do when it comes to things that stand to make certain interests a lot of money.
Exactly! In the 1800’s we brought in more and more immigrants to work in our mills, mines, and factories at starvation wages while the US insisted on countries opening up to our exports. We were over producing with all the cheap labor and 14+ hour workdays and since labor was paid so poorly we did not have a domestic market. Immigrants were even brought over on contracts that paid their fare and required them to work to pay off the debt. These were used as strike breakers especially in the mines. Then we sent those poor men to war while Gould, Rockefeller, and Mellon paid to be replaced in the war while they profited from the war. Rockefeller bought a warehouse of defective rifles and sold them back to the army at a huge profit. This group then made up the robber barons with the monopoly trusts. Is this when we were a great nation?
Yes. It is workers’ poverty in America that has them turning to Walmart’s and Thrift Stores to buy all manner of goods at low prices, especially given the costs of daily life, costs so poorly captured by the CPI. The greater the inequality of incomes, the greater are such ‘markets’.
This has nothing to do with the myth of consumer sovereignty and a lot to do with how that myth has been peddled by American ‘libertarian’ economists.
I’d originally stopped back to compare CD’s commentariate to Yves’ on this speciously BS article to what’s ALWAYS been the one critical story: consumers glibly destroying whatever future their kids might have, for their dopamine hit. I’d bought a $53 “German” drip coffee maker, made in Camorra cartel sweatshop hell, before they ran out and I’d be stuck with it’s FAR less dependable Chinese replacement. Common Dreams posts these Panglossian pontificating puff pieces, telling President Joe Biden™ to “Go BIG,” I’m preferring the wry & sardonic comment threads.
Corporations will never bring back factories and manufacturing because factory workers organize easily and understand working together. A factory is a situation where the investors and owners are completely removable because they are unnecessary; the factory only needs workers, materials. and customers. So manufacturing is a dangerous business for an investor class that makes money simply by owning things. Workers taking over factories and running them sans owners is too perilous of an outcome for the investor class. That’s the reason the US economy was rejiggered around service McJobs.
And if workers organize more easily in factories just by the very nature of the factory itself, then why aren’t workers in the countries producing our crap organizing for better wages and conditions, which would in turn push up the cost of our goods?
I think the answer to the question will reveal various methods of brutality.
Yes, those countries’ oligarchs, who it might be, really, are now the same ones who are our oligarchs, control their peasant-workers more smartly than ours have. The way to handle peasants, I think history tells, is to keep them perilously close to real privation and starvation. Don’t let them have even the idea that they safely can be uppity. (I can’t tell if I’m being partly facetious with this remark, or not, especially with the tone.) In our case, however, the peasants, us, we’re allowed to get the big head and made to feel it safe to complain, so more docile, cowed peasants had to be found to do the factory work. Meanwhile, our peasants, us, gradually return to the normal state of peasant desperation, which will eventually, probably, make us once again more controllable.
Is the minority of Americans who believe that ” buy a fair-price American thing from fair-wage American thingmakers” big enough to keep some American thingmaking companies in business at a survival level till the broader civilization returns to that basic concept?
Somewhat like the Irish Monks keeping Western Civ knowledge-information alive in their Monasteries during Western Europe’s Dark Ages?
Does anyone make or keep lists of still-existing American thingmaking or thingdoing companies where Americans with enough money to live on could pay fellow Americans enough money to live on for making or doing things in America?
And beyond that, does anyone keep lists of wages, conditions, etc. in all the different countries of the world, so if no one makes a coffee maker in America anymore, maybe someone still makes a coffeemaker in Canada, or France, or Mexico, or somewhere, where conditions/wages/etc. are better than they are in the Worst Places In The World?
> … his stock portfolio was a little too heavy in Sunbeam, a once successful
> small appliance maker …
At the risk of injecting a bit of levity into this serious discussion, I am reminded of a delicious cartoon from many years ago. Two young preppy-looking chaps are admiring a shiny little sports car. One of them says ‘Sunbeam, eh? My mother had one of those, only hers was a toaster’.
https://en.wikipedia.org/wiki/Sunbeam_Alpine
I agree with most everything ya’llv said about Mal*Wart above and below, and I’m certainly not defending them or their business model, but have any of you actually shopped there lately? I had not for at least ten years…then we moved to a small town where there are few to no alternatives. We all know that certain things are not made in USA anymore, so Walmart couldn’t sell them even if they wanted to, electronics notably, but they actually do sell stuff made here, at least there is a lot of product labeled as if it were made here. Clothing is the main thing I noticed last time I was in there, next time I’ll pay more attention but it seemed there were a lot of things in the household goods section labeled made in USA.
Sam Walton did support Made in America back in the day. I remember being in the store back then.
But his kids gave their suppliers a binary choice – cheaper products or else. Most small American companies decided they had no choice since if they could not sell to Walmart, they ceased to exist. As far as I know, Walmart is still the single largest importer of goods from China.
The Walton kids were a major driving force in pushing American companies OUT OF EXISTENCE or offshore. They also were also behind destroying estate taxes. They also teach their employees how to apply for aid since they are all so underpaid that you and every other American taxpayer gets to cover Walmart’s healthcare costs.
Not buying ANY defense of Walmart.
My old attorney had to forcibly warn her small business clients (with cutting edge products in the hair biz and cosmetics, there’s actually a lot of advanced chemistry in the good stuff) never never never to take an order from Walmart. Their game was obvious as of the 1990s: give such big orders that Walmart became the dominant customer of that vendor (as in they could not afford to lose them), then squeeze them to take orders on zero profit or even small loss terms. She saw promising company after promising company slowly bled dry by Walmart.
I don’t understand how you can say that Robert Reich is full of s**t. What he said is a simple truth. This country would have zero unemployment if it reverted back to slavery. Is that what you espouse? It is true that businesses that can’t afford to pay a living wage ought not be in business. Those who are addicted to cheap goods from Walmart need a 12 step intervention, and perhaps ought not to buy the cheap junk Walmart sells.
The simple truth is that America’s most successful companies use the business model of not paying a living wage to further their success, never mind the inhumane working conditions attached to those non living wage jawbs.
And in a sickening race to the bottom, Gresham’s dynamics writ large, those companies that don’t use the business model of not paying a living wage will be eaten by those that do.
FFS, Reich could call a spade a spade, instead of typing mealy mouthed bullshit into twitter.
Many communities across the US are essentially dependent on Wal-Mart now and many, many people can’t afford to pay higher prices.
For others who can, is Target really a whole lot better than Wal-Mart? Many in the US think so.
Many places simply don’t have local shops to supply these goods anymore.
It’s a systemic/structural nightmare at this point.
A lot of the people who shop at Walmart had their jobs sent to Mexico or China or Bangladesh, or somewhere. At which point they either went begging or onto some kind of welfare, or into a seething cauldron of part time jobs at Walmart wages.
Now that they are on Walmart wages, Walmart prices are the only prices they can afford to pay. So it is too late for an Intervention to help them. Only a Hostage Rescue could help them at this point. Or an economic prison break. They are all Prisoners of Mother Walmart.
Now it is the Amazombies ( Amazon Shoppers) who could maybe still benefit from an Intervention. Many of them are still people who can afford to pay a higher-than-Amazon price, but buying from Amazon is soooooo grooooovy. So digital. So kyewl.
People who buy things from Amazon if those things still exist from somewhere else should get what they deserve. Someone once asked me what it is that such people deserve? I’ve been thinking about this and I finally have an answer. People who buy things from Amazon deserve to work for Amazon for the rest of their lives . . . either driving, or Fulfilment Centering, or some other such task.
I live in a small rural town that doesn’t have much small business anymore with a Walmart in town. I do kinda have to buy from Walmart or travel a long distance. What I do in this situation is only buy grocery’s from them thus depriving them of any income from imports.
Also as this town is not generally aligned with my political and economic opinions and a lot do not agree with how I make my income(unionism) I also close my wallet to those small bushiness that are left. All large purchases, for example a new roof I recently had done, are businesses and material suppliers from out of the county. Next I move.
And abolishing Free Trade. Cancel and withdraw America from all Free Trade Agreements and Treaties, including GATT Round One if necessary.
Forbid imports from any place paying less than American costs and wages, and then American businesses will be able to pay American wages and meet American costs, by legal force if necessary.
But that won’t work until Free Trade is abolished and Protectionism is restored.
Destroy the then profitable factories making quality products, then drive out of business the profitable, independent stores staffed by knowledgeable clerks selling that quality merchandise, and finally pay below what is needed just for mere survival, and then stand around just amazed at the laziness of Americans who can no longer afford to pay for even the garbage that is only being produced.
At a race to the sharp, rocky bottom it is now. Where our economy is going become a flaming ruin.
Who woulda, coulda guessed that some only want the world to just burn. It would provide heat, light, and entertainment at least. Our American oligarchy really is an Kakistocracy run by chinless idiots.
Paul Krugman, another pundit known for generating and eliciting strong reactions, made an audience full of economists laugh while commenting about Robert Reich. He pointed out how there were people, even at Cabinet level, who lacked common sense.
That italicized portion was delivered with particular relish and those sitting close enough to the podium could see the gleam in his eye. ROFL
Amazon, Wal-Mart et al should be paying $20-$25 with immediate health benefits upon hire. Smaller businesses that can’t pay due to larger structural economic forces that have developed over the decades – and over which they have largely no control – could be subsidized by the government to pay a living wage and benefits.
Of course, paying people well and providing good benefits at places like Amazon and Wal-Mart is just going to further cement the consumerist lifestyle.
Communism!!! :-)
Haha. Indeed. The desire for a decent existence for all is often smeared as such. It’s strange, isn’t it?
Adding, it’s a really selfish desire, too. My commonsense tells me that everyone having enough to live dignified lives helps keep me safe and eliminates the need for a mass surveillance/security state.
I’m also selfish in that I like looking around and seeing people healthy and happy. It makes me feel good.
No. Employers must not be responsible for employees’ health care. That’s the job of government, as it is here in the UK and in most of the world. Why is Joe Biden being praised when he’s doing nothing at all about creating a national health service – not M4A, a real, publicly-funded health service, free at the point of delivery for everyone in the USA? That’s a basic right. Pillory the guy until he and your representatives create it.
That is a tough road to travel in this country. Even the most progressive people have been thoroughly indoctrinated from birth in the neoliberal economic model. They can’t even imagine a national health system in the United States. To them Medicare For All is as bold as they can imagine.
Good point. Energies put toward gaining/strengthening benefits on the employer side, which, given how our system is currently structured, is essential – will both take energy away from the fight for M4A and further cement the current system.
If corporations had to pay decent wages AND for good healthcare (not just health insurance), they would be the first ones screaming for a national health service.
Dunno. During the ObamaCare debate, I argued with some small business guys that they’d be much better off if the government handled health care so they wouldn’t have to bother with it. They disagreed. They were so sure government couldn’t do anything right that they figured national health care would just end up costing them even more than they were already paying.
NC recently ran a chart showing what Medicare costs gov pays for 65-70, way less than what private costs are for 60-65. Quote that to your SB buddies.
Great point, hits the nail on the head. I would take it a step further and suggest it’s also the role of government to provide universal basic income. Relying on profit seeking employers to provide the public with a minimum standard of living is like asking the foxes to do the same for the chickens. Let employment income be supplemental to basic income so wages can be wherever supply and demand might meet. When we impose an artificial floor on wages (and require employer funded healthcare to boot) we create massive incentives for employers to resent their employees, replace them with machines and influence government policy through any available means.
OK hardly a source for proper statistics, but the anecdotes are funny/shocking/heartbreaking.
Some US Restaurants Are Struggling To Find New Employees, And People Lay Down The Reasons Why – BoredPanda
“funny/shocking/heartbreaking” is right. Thanks for sharing that link. Worked many restaurant jobs over the years, mostly for “mom & pop” ones and never for a large corporate one. Saw how much they struggled to survive while customers flooded the nearby chain restaurants that serve glorified fast food and treat their employees like trash. Friends that worked at those places technically made more than I ever did (higher volume of customers so more tips) but the treatment they had to deal with from both management and customers, to me, wasn’t worth it.
Glad to see talk about paying a living wage gaining popularity. Maybe need to start educating customers about the real cost of products and services too? Too often the definition people have of “value” is about how cheap it is and not its quality or the labor that went into creating and delivering it to them.
I could write a novel just from conversations and experiences I’ve personally had regarding this and will refrain from a long diatribe here but our WalMart/Amazon low-cost addiction has infiltrated all aspects of commerce and gutted our ability to get paid a living wage. Obviously there are a multitude of factors that got us here (legislative, tax policies, rigged markets, etc) but customers need to start buying into an economy that builds communities instead of gutting them if we’re ever going to see real changes. Every time I see an Amazon delivery van (uncountable times a day) I see a vision of a dystopian future for workers, business owners, and society as a whole where we’ve all got to sell our soul to the company store.
But what IS a living wage and is it the same wherever you are?
And what do you do about driving up the cost of labor to a point where it is more cost effective to automate?
This robot can cook hamburgers in volume to a perfect med every time.
https://www.youtube.com/watch?v=ZiD_6ex2ptY
They have one that is coming out that can do french fries etc too.
How hard is it to automate a machine that pours drinks?
I give it a year, maybe 2, before they can fully automate an entire line from order to cooking to taking payment and handing out the food. Fully automate the process end to end. The advantages for a chain restaurant would be amazing in terms of space savings and cost. You could probably get to a point where you only need 2 or 3 people for an entire shift and they are there just to deal with times when the machine has a glitch.
Imagine if you designed the entire building from the ground up to be automated. Smaller footprint. Less need for cooling and other human friendly elements.
while burger flipping has been automated for quite a while, think burger king conveyer belt broilers, there remains lots of work for at least 10 people at the mcdonalds in anacortes, they’re running essentially two stores, the drive through and the walk in…constant restocking and the like…and when there’s a delay? Could you pull up to spot #2 please someone will be right out with your stuff…if you think you can make a robot to do that well it’s evaded pretty much everyone else so get going and count your money!
Teslas are level 2
Re the burger conveyor belt, the Burger Chef I worked in for a few months in high school (at the grand wage of $0.80/hour) about 1970 had one of those. During rush times the bowl that the finished meat fell into would constantly have the fresh burgers taken off the top to make sandwiches, leaving some very cold ones sitting at the bottom to be tossed out. Or if a customer was being a pain, I suppose they might have occasionally gotten one of those in their sandwich (not that I ever did it, but I think it might have happened).
A small restaurant in Ocean City, NJ is rolling out a robot waiter. They call it Peanut:
https://pressofatlanticcity.com/news/local/watch-now-ocean-city-restaurant-hires-robot/article_2beda264-fa6f-5ab2-80bb-014fa5afbac7.html
https://www.robotshop.com/en/keenon-delivery-robot-t1.html
“Max climbing angle: Slope ≤5°”
“Working environment: Indoor environment, flat and smooth ground”
“Endurance: 5-8 years”
I can get you into it for 13 grand,whaddayasay? Chicks dig robots is all I’m sayin’
I can’t afford it. Maybe next year when I land that big job…
Well then, robotize McDonalds and pay the robot makers and the robot tenders and the robot feeders a living wage.
Barbara Ehrenreich wrote about similar travails in her book Nickel and Dimed. That was 20 years ago, sigh, so some problems mutate into different levels of intractability.
In this environment where “competitive wages” rule (i.e., offer just enough so some desperate enough will take the job), you need to be a either a unicorn, part of a strong bargaining unit, or in a field protected by licensing or credentials to make a decent income.
I’m sure that there are many places where a $15hr job is seen as a “good” job, but overall that’s a crap wage and hardly enough to support one person, let alone a family.
Let’s return to 1960s wages, adjusted for inflation/true costs of living.
The minimum wage in 1968 was $1.15. In today’s dollars that’s $8.69.
If you were young and remember money going further, you probably had a roommate, ate a lot of carbs and didn’t own a lot of stuff. There’s a good reason why hippies were into patched clothing.
On the plus side, a loaf of Wonder Bread cost 22¢, gasoline (if you had a car) was 34¢ a gallon, and you could buy an entire house for $26,000 (but in today’s dollars that was a shade under $200,000.
The pot was low quality, and Budweiser truly was the king of American beers. There was also a military draft, and for most people I think taxes were higher. Thai food was impossible to find, Italian restaurants were considered exotic.
I’ve been trying to think of when things were really good and frankly, I’m stumped.
Okay. You do realize that $8.69 is more than $7.25, yes? And that a shade under $200,000 is less than today’s median for a single family house of $347,500 (https://fred.stlouisfed.org/series/MSPUS). And that the federal minimum wage is not the best measure of middle class earnings.
Consider this 30 year chart of average v. median U.S. wages from the SSA: https://www.ssa.gov/OACT/COLA/central.html. It documents a steady decrease in the median versus the average, which is cause by the dramatic increase in compensation in the upper reaches of our economy. These are all downhill trends for our society. Not indicators of some kind of steady state, just as good as it ever was way of life.
This is embarrassing. We’ve been talking $15 so long I honestly forgot how low the actual minimum wage still is (in my mind it’s more like $10/hr because that’s what so many employers have been forced to default to).
I still think life in this country has stunk for minimum wage earners no matter the decade but yeah, $7.25 is the absolute pits. And from personal experience I know that the gig economy (especially online) can pay far less than minimum wage.
You forgot to compare CEO pay in the 1960s to CEO pay today. Have a look at that and get back to us all here on NC.
And real taxes on the top 1% was about 40-50% back then. And certainly company CEOs may have lived in good neighbourhoods but not in gated communities with guards. As well, the companies that the CEOs were head of had to actually pay taxes and were not tax-free like today’s biggest multi-billion dollar corporations are.
As mentioned up top, corporate profit share of GDP, then vs now?
I wonder how this article would have been written if Biden had pushed through the $15 an hour minimum wage right across the board for every industry? Would more people be willing to go back to work for that? Would there be a noticeable difference in the economy? But we all know that this was never going to happen as both political parties work for the same type of people. Perhaps not the same people but still the same sort of people – and they all come from the one class that wants to keep that wage difference for themselves. With the current inflation rate, that $7.25 is worth less and less each year so at what point will the government be forced to step in and pay those workers their wages themselves so that they can continue to work at those corporations? You know it’s coming. Having workers for major corporations collect stuff like food stamps because they are not paid enough is a step in this direction and it has been happening for years.
In USA health insurance keeps many tied to their jobs. Health insurance costs hurt the hell out of small business and make us a lot less competitive with the civilized world, countries that support their businesses, industries, and citizens by providing access to basic medical care.
To the Chamber of Commerce, a small business owner is a nobody, and workers are just costs that need to be minimized.
I work for a law firm that dealt with employee relations, representing employers in collective bargaining. The “Great Recession” was a godsend to them– plenty of ammunition to slash at wages and benefits.
The firm primarily supported Democrat candidates.
To the Chamber of Commerce, a small business owner is a nobody,
Except for the 1,000$ (my Local Chamber) wants yearly to be part of the club and get their Lobbying Services (very considerable and powerful).
A local news reader opined that too-generous unemployment benefits were the cause of the labor shortage and the new-jobs number released yesterday. I had to send an email to the station’s news director pointing out the obvious political bias in that seemingly off-handed comment. No, this was not a Fox affiliate. CBS.
If you make more money staying at home collecting your hard-earned benefits instead of working for scraps, then you’re only being logical and making a good financial decision, especially if there are no benefits at the workplace that are compelling enough to draw you back. That’s simply looking out for yourself. Jeff Bezos looks out for himself and for Amazon. He doesn’t have platoons of lawyers and lobbyists for nothing. If he can game the system, so can the dishwasher and the car-wash attendant.
But UI is not welfare. This is insurance, and we pay for it with every paycheck.
Governors who are clawing back UI benefits to coerce workers to return to low wage jobs are un-Christian and just plain hateful. Call them out for what they are!
And if it’s so damn important to have someone sweep the floor, the business owner can do it!
Working hours are also an issue.
Local McD had the sign up so I asked–9$ to start and 4-5 hour shifts typical=36/45$ gross for a morning or an afternoon. Everything swings also– at 32hrs a week or below–298$ gross for 6 days of part time busting up your routine of day.
WallyWorld too–pay seems up, but I was told max hrs are down, and definately no OT.
Local Mfg’ing has signs out but some direct to Staffing Agencies for screening then entry.
Both Carolinas are cutting off UI in June citing direct contribution to Employer Hiring dilemma.
ime–Workers want stability, full hours, AND wages that wash over what UI pays(which probably showed clearly what Life was possible with a Decent and Steady cash flow).
That assumes you get all those hours in the first place–staffing for fast-food here in the United States often operates on a “just in time” model, where you can get sent home at a moment’s notice because that day’s sales dropped too low, or weren’t high enough to begin with.
This happens in other places too, including retail, but in fast-food it seems to be particularly common.
Yes, here in my tiny “most Democratic of states” we have our Democratic governor preparing to turn the screws on workers who are collecting unemployment payments. The local argot is “collecting.” Our wonderful Hospitality Industry which thrives on starvation wages and the kindness of strangers is facing a major shortage of labor in its crucial summer window to make the cash. I mean really…who wants to wait in line for brunch!
The solution to flipping burgers is likely to be automation, which is already in the works.
It’s coming regardless of what the minimum-wage is, so I’m not using that as an argument against raising the minimum-wage–the minimum-wage absolutely should be raised–just pointing out that automation is coming whether we like it or not.
promises promises. Humans are smarter and cheaper
Teslas are level 2
The automated burger flippers will feed the automated burger flippers? Is that how widespread automation works? it is just arbitrage, because if taken to the limit full automation of the economy means economic collapse. So of course that will not happen. Empty threats by business interests.
No one seriously thinks were going to have full automation (i.e. no jobs) anytime soon. However, there are a growing number of jobs that can be automated, including some white collar jobs, and if it’s cost-effective to automate it will be.
Even McKinsey, which is not exactly known for being anti-capitalism or anti-technology, has suggested that the coming disruption from the “Fourth Industrial Revolution” will be pretty significant.
If Progressives want to remain relevant, they need to start taking this seriously instead of burying their heads in the sand and pretending it’s only sci-fi.
If you don’t have answers for those affected, the people displaced will vote for someone who does, which (god help us) could even be another Trump.
Ignore this issue at your own peril.
Your first paragraph has been an operating principle since the start of the industrial revolution, with the key being “if it’s cost effective to automate it will be”.
What is different in today’s world, or what I percieve different is that the ultimate fruits of that automation and subsequent productivity improvements are not widely shared, tending to fill up the fruit bowl of the owners of automated equipment (capital) and leaves a small bite of rotten fruit for those remaining (labor).
Already there are signs of too much automation in some settings. Mercedes got rid of a bunch of robots because programming and coordinating them to install the correct pieces depending on options turned out to be nightmarish, and considering the amount of customization potential with each car, saw the writing on the wall and took a few steps away.
To use Amazon as an example, much of the warehouse operations are automated and Bezos would prefer total automation, yet there are positions that seem simple on the surface but when you get to details, hard to automate and when that automated equipment stuffs up a few packages the whole system grinds to a halt. The employees stuck at those “work stations” have packages shoved at them at such a high rate they should be paid like elite athletes, except moar because the do it for hours and hour per day, wheras an elite athlete trains for hours to play for twenty minutes during the game.
The churnover rate is greater than 100% per year, the jawbs are not physically sustainable at the pace of work they are forced to do and since it is impossible to have a 30 year career with a descent pension at the end of work life, the whole system is predicated on massive abuse. That’s the business model of Amazon.
Automation should take away the monotonous, dangerous work, yet here, even though Bezos bought Kiva Robotics to turn it into an Amazon only company, and at the same time deny all else robot warehouse technology from them, the result is horrific abuse.
When it comes to restaurants, the reason people go isn’t the food, but being served and to see and be seen. Dressing down a robot that brings the wrong colored coffee just won’t make them happy.
With automation it is possible to churn out way moar crap than is possible to sell. It becomes self limiting at that point.
This is what people who buy from Amazon support with every purchase from Amazon.
The people who buy from Amazon deserve to work at Amazon in exactly the conditions you describe.
They support it, they deserve it, let it happen to them.
Yeah, that would be some form of justice, but I think Amazon shoppers are oblivious to the abuse, and the ones that aren’t and still shop there have their own justifications for doing so.
Amazon get’s great marks on consumer satisfaction surveys when just glancing at how the sausage is made might change some minds, so everything is done to not look, with the MSM a full partner in the misdirection con they run with Amazon.
They tout the Amazon = great middle class jawbs meme constantly, look at the new crapola Amazon came up with, ain’t Amazon great, news flashes and then run self congratulatory Amazon adds for the payoff.
I wonder what might happen to Bezos’ source of money, the stawk price of Amazon, were the MSM to do a serious investigation into all the abuses that Amazon performs, the return abuse, the third party seller rip off abuse, the millions of fake review abuse, fake products abuse, the worker abuse, the copywright abuse, on it goes, and then on the nightly news, day after day, for months on end, have one segment after another detailing that abuse? Might Mr Market have a hissy fit and Bezos’ billions melt into nothing?
That would be justice. That isn’t what we are gonna get. The system is entirely too corrupt for self correction..
Well . . . . side stream reporters can study and report this in the side stream media. And bloggers and blog readers can ooze these things out into the digisphere wherever they can.
If all we can do is create/ become a community of citizen-customers who pay more for something in order to keep our money away from Amazon, and we can number enough to at least keep the NOmazon sector alive through the hard times, then let us at least do that.
Or even the very same Trump itself; tanned, rested and ready after 4 years of training in Florida.
Its ElectoMania! Cage-match/ Grudge-match 2024! Sleepy Joe versus The Trumpinator!
This discussion lacks references to the clear and proven remedy for low wages.
Unions.
Unions mean nothing in a Free Trade Environment. That’s what Free Trade was for to begin with. To exterminate unionized industry in America so as to exterminate the American unions in America. That’s why Clinton supported NAFTA . . . . . to exterminate the unions whose members broke young Clinton’s heart by voting for Nixon in 1972.
NAFTA was Clinton’s revenge on the working class. As well as being his audition for post-presidential wealth and rewards.
This is just a small, local article but it presents a clear divide emerging on the topic between restaurant owners in NJ. It has some choice statements from owners on “both sides” of the issue as well as commentary about other factors:
https://www.nj.com/coronavirus/2021/05/are-workers-staying-home-due-to-extra-unemployment-benefits-its-complicated-experts-say.html
“its impossible to get help because I pay too low”
Whats the max they are getting on unemployment? $3200
Thats $800/week in NJ
Good luck living on that… or below it.
Neoclassical economics and the missing equation.
Disposable income = wages – (taxes + the cost of living)
Let’s work out the minimum wage
Set disposable income to zero
The minimum wage = taxes + the cost of living
They push up the minimum wage as housing costs, and the cost of living rise.
When people are sufficiently squeezed they put on yellow vests and take to the streets as they did in France.
The US and UK are very similar in many respects and UK policymakers have sunk to new lows here.
They call the minimum wage, the living wage.
They specify it at an hourly rate that won’t pay a living wage in a part time job.
Most of the new jobs are part time.
As a mining engineer working in Zambia in the 80’s I took over the supervision of part of the underground mine. I quickly discovered that the miners, mining the access tunnels with 60 pound hand held compressed air drills, were working 9 hours a day, 7 days per week. I stopped the Sunday working and the total advance per week increased despite working one less day.
That sounds like the first part of a very interesting experiment. If your successors in that supervisory post in the Zambian mine went back to making the access-tunnel-diggers work 7 days a week, the progress of the tunnels could be studied, compare and contrasted to the progress under your 6-days-a-week schedule for them.
One wonders if anyone ever looked into this.
Remember the two rules of Capitalism:
Rule#1- There is no such thing as too much profit.
Rule#2- See rule #1.
“Corporate profit share of GDP has been record highs for years…”
Not only that, they’ve had decades of tax cuts and decades now of lowest of low interest rate for loans..AND the best they can think of is a return to feudalism.
There is no there there to appeal to.
Just BS, smoke and mirrors PR….
Yves:
Maybe I am wrong?
Has anyone looked at Participation Rate and the Civilian Labor Force numeric? PR is up 2 tenths of 1% and the Civilian Labor Force increased by 430,000 from March to April. From January 2020, PR was down 2% and the nation has recouped 2 tenths of 1%. Employed is up ~300,000 and Unemployed is up ~100,000.As you well know, to be categorized as Unemployed and part of the Labor Force a worker has to be looking for work.
During 2020, the trend was downward for PR with blips along the way. It appears the trend is upwards in 2021 for now.
People are coming back to work and looking for jobs. The low wage jobs are typically staffed by women who can also be caretakers of children. Many are still at home (if they can be) taking care of children.
That is my take and on what is going on this month. Of course, the politics are rampant.
just like business, labor needs barriers to entry. de-globalize the labor market, both by restricting immigration and off-shoring production, and we won’t need to listen to Reich’s nonsense. it’s not complicated.
Free Trade is the New Slavery.
Protectionism is the New Abolition.