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The most obvious answer seems to be that the workforce keeps growing relative to the demand for that work. Wage stagnation began at the same time the number of

The most obvious answer seems to be that the workforce keeps growing relative to the demand for that work. Wage stagnation began at the same time the number of women in the workplace started to grow. While a corresponding increase in demand with the supply of workers would have kept incomes moving upward, women were actually already consumers. They had to eat, be sheltered and clothed, etc. even when men made up the vast majority of the workforce. The rate of the growing female workforce itself started to stagnant around the 90s and 2000s, but a new worker had fully emerged on the scene by that point: The robot. It's a slight misconception that robots eliminate jobs. In reality, they compete for them just like people do. They are another worker in the supply of workers. And while robots bring new demand, as they didn't exist before, it is not proportional to what they can create like with humans. And so, increasing supply over the rate of what increases to demand exist, and you get downward price pressure.

geezerjay 9y ago
> The most obvious answer seems to be that the workforce keeps growing relative to the demand for that work. Interesting, and very plausible as well. Please don't get me wrong, but you happen to have any source that supports that hypothesis? I don't doubt any of what you've said and I do believe you're on to something, but I would like to read more on the subject.
- saint_fiasco 9y ago
  A popular book on the subject is The Two-Income Trap, by Elizabeth Warren.
  - PaulHoule 9y ago
    It's a very interesting book, but I think it is more about changes that happened in the 1950-2000 time frame more than later than that. The core idea is that a two income family is less financially resilient than a one income family because (a) the extra money goes to bid up housing prices (education, healthcare, etc.), and (b) if either partner has a setback, the family is at risk of bankruptcy. Impacts of "women entering the workforce" have been relatively unexamined; one of them is that it frees up employers to practice other kinds of discrimination. For instance, many believe that black men held service jobs that got taken over by white women. You will get a woman on the Supreme Court but she will have been educated at Harvard. Pointedly, the supply of "people from high-class families" is doubled, so any bias towards hiring them can be indulged more freely. --- Some of these ideas have gotten traction in unexpected places. I was talking to a conservative friend the other day and he told me that "the gains of paying workers more would be eaten up by cost increases in housing, education and health care", which he didn't know was classic Elizabeth Warren!
    - saint_fiasco 9y ago
      It's not like Warren discovered it. Conservatives have been whining about the destruction of the family for ages. It's just that since they say that about everything, people did not take them seriously when they were right. Broken clocks and all that.
      - erroneousfunk 9y ago
        You're saying that the participation of women in the labor force is a bad thing?
        saint_fiasco 9y ago
        Not for me. Even if wages don't go up, productivity does, and that makes things cheaper. I don't think we would be able to produce and consume so much with only half the workforce. As for the destruction of families, that's going to happen under capitalism anyway. Free markets don't like nepotism and families don't like mobility of labor. For the people who don't benefit from capitalism, it's a very bad deal to them because they gave up the safety nets of familial bonds in exchange for nothing. It's why conservatives aren't enthusiastic about capitalism and free markets (anymore?).
        PaulHoule 9y ago
        It is what it is. It has many benefits and it is not going to be reversed, but it has negative effects on social and racial inequality. If a person educates their own child, or cooks their own meals, or provides other domestic services, that labor does not get taxed, does not contribute to making distant investors rich, and does not employ union labor. (I am male and I have done those all of those things at times.) Liz Warren points out that an "at home" family member can often get a job to supplement or replace the wages of a primary wage earner; long-term changes could be weathered by the secondary wage earner becoming the primary, or it could be a temporary job to save some money or pay off some debt. It is not a subject we have good conversations on because it is so inflammatory.
      - PaulHoule 9y ago
hashkb 9y ago
Aren't you ignoring all the unfilled positions the article is suggesting would be filled if employers paid fairly?
- randomdata 9y ago
  Not really. Demand, by definition, is the willingness and ability to pay the price to acquire what you are looking for. A job that doesn't pay sufficiently to attract people into the role is a job that was never part of the demand in the first place. Since the demand is not real in these cases, there is no additional demand pressure on the price. Anyone can say they want to buy a new Ferrari for $10,000, but that does not mean Ferrari should get excited about a new customer. It's all imaginary.
  - deathanatos 9y ago
    But by that same definition then, is not a worker who wants more than what the employer is willing to pay then no longer part of the supply? By saying that it's just a system at an economic equilibrium, it feels like we remove any ability to make any comment on the system as a whole. It becomes just being what it is. I wonder if you can't pull in some other evidence, such as, well, if you actually did raise your pay rate to a point where there would exist a worker willing to work for that amount, and you could further prove that worker would still be able to create enough value to the employer s.t. he or she was worth hiring in the first place, and that it then only boils down to the short-sightedness of the employer for not being willing enough to offer a higher wage? (For example, something like the absurd valuations of some SV tech companies, and the millionaire they make, compared to the salary of an engineer. I personally think most places I've worked could move faster — generate more value — with better engineers, but that can't happen if you're paying "market rate" instead of paying competitively. But "enough" value is being generated, at least, people think, I guess.)
    - linkregister 9y ago
      In the realm of software, there is a limited number of "better engineers" in a given region and in the entire world. Paying more will have a zero-sum effect in the short term, simply attracting workers away from other software companies. In the longer term, it will encourage more newcomers to enter the field and spur the "less better" engineers to improve or update their skills. I'm still not clear about what you meant by "better engineers"; I'm in doubt about the theory of the 10x engineer. If you meant engineers with updated skills, then I might agree with you.
RestlessMind 9y ago
> women were actually already consumers But what about extra discretionary income which would stimulate extra demand (another car, another vacation, another gadget, home services now that both partners are working)?
- shados 9y ago
  A lot of the extra income is just going to housing.
  - matt_wulfeck 9y ago
    And student loans, car loans, and credit cards.
- randomdata 9y ago
  It appears that the additional income coming into the household largely went into the existing costs that the household already had. For instance, shelter. If every home only has one earner, shelter costs can only rise to the maximum a single earner can pay. But once households started having two incomes, the the second income helped place higher bids on securing a place to live and eventually you get to the point where you cannot live somewhere without having two incomes. In some cities today, we are reaching the point where you need three incomes (see: the robot).
FussyZeus 9y ago
It seems oversimplifying to say that robots are "just another worker." When women entered the workforce, they came with similar costs to their male counterparts; wanted breaks, expected time off, lunch break, commuting time, various facilities. Robots require...well, power. They don't need breaks or bathrooms, they don't even need to go home. Hell, if you really wanted to, you could run an entire auto plant with little/no climate control in complete darkness and the robots wouldn't mind one bit. There's simply no competition between robots and humans, that's why I'm a firm believer that automation will take all the jobs and we need to figure out how to handle a post-work future before we start riots.
- davidf18 9y ago
  Like any other form of capital equipment, robots have other costs besides initial purchase and electricity such as maintenance and reprogramming. Various forms of farm machinery such as combines automated farm jobs for the better. So true with robots in factories and artificial intelligence that replaces lawyers for standard contracts.
  - marcosdumay 9y ago
    Well, this. Widespread robots mean that the entire economy runs with the SaaS accounting. High investment, relatively low maintenance, incredibly high productivity.
sharemywin 9y ago
Except the article cites several examples of where demand isn't being met. -Farmers in Alabama are fretting that crops may rot in the ground for a lack of workers to bring in the harvest. -Despite high demand, home builders in Colorado are throttling back activity because they can’t find the workers to erect frames. -An airline canceled flights because it couldn’t find enough pilots to steer them. Those aren't demand problem but supply problems.
- deleted 9y ago
  [deleted]
  - deleted 9y ago
    [deleted]
- jdavis703 9y ago
  I was on an airline that could not find enough pilots at a low enough rate to fly the planes. That was Spirit Airlines, an ultra-low cost carrier. I don't mind small, hard seats and no snacks for a quick flight, so I thought I'd save the money. Well, it turns out that Spirit has one of the highest profit margins [0] of any domestic U.S. airline, yet they decided they'd rather cancel flights than pay pilots enough to show up [1] -- they'd even rather hand out $100 vouchers to all the affected passengers than pay the pilots more. On a flight of 50 people, that's at least $5000 they lost, not to mention the staffers they had to pay (baggage handlers, gate agents, etc) that didn't actually wind up being able to complete their jobs. [0] https://www.dallasnews.com/business/airlines/2014/09/22/sevem-u-s-carriers-among-the-worlds-most-profitable-airlines https://www.dallasnews.com/business/airlines/2014/09/22/seve... [1] http://money.cnn.com/2017/05/09/news/companies/spirit-airlines-pilots/index.html http://money.cnn.com/2017/05/09/news/companies/spirit-airlin....
- lotsofpulp 9y ago
  It's a combination, where the demand curve never meets the supply curve at an acceptable price for the consumer. It could be due to being able to obtain a product cheaper from somewhere else due to lower labor costs (happens due to converging standards of living across the world), and it could also happen that there are alternatives, such as other jobs and/or social security disability or welfare that make doing undesirable jobs need an even higher price point to make it worthwhile.
Lagged2Death 9y ago
Wage stagnation began at the same time the number of women in the workplace started to grow ... The rate of the growing female workforce itself started to stagnant around the 90s and 2000s... Have a look over here: https://www.dol.gov/wb/stats/facts_over_time.htm https://www.dol.gov/wb/stats/facts_over_time.htm The US ratio of female/male employment experienced a strong long-term upward trend during and after WWII (1940s), and the absolute number of women working jobs in the US has climbed steadily right to the present day. The modern era of wage stagnation relative to productivity started in the 1970s, somewhat before the strongest growth in the female/male employment ratio, and continuing even after that ratio flattened out. http://www.epi.org/files/2013/ib388-figurea.jpg.538 http://www.epi.org/files/2013/ib388-figurea.jpg.538 http://www.epi.org/publication/charting-wage-stagnation/ http://www.epi.org/publication/charting-wage-stagnation/ ...a corresponding increase in demand with the supply of workers would have kept incomes moving upward... Or it could send jobs overseas to poor countries with low wages and little in the way of labor or environmental regulation.
autokad 9y ago
i think a large part is that companies are hoarding money and wealth goes there to die. if we stepped up pressure on companies to spend their money (one way or another), i think more jobs and higher wages would follow.
- marcosdumay 9y ago
  The US has a government running a big deficit and a population increasing it's net credit. Someone has to hoard those debits. Large companies are a bad place to concentrate money, but your entire government is working towards it.
kerbalspacepro 9y ago
How does this answer the question the author brings up in the first paragraph? >An airline canceled flights because it couldn’t find enough pilots to steer them. Despite high demand, homebuilders in Colorado are throttling back activity because they can’t find the workers to erect frames. Farmers in Alabama are fretting that crops may rot in the ground for a lack of workers to bring in the harvest. Robots can't do all those jobs, and yet the wages for those jobs haven't increased enough.
- randomdata 9y ago
  Economics says that demand is a consumer's desire and willingness to pay a price for a specific good or service. Offering a job at a price below what someone is willing to do it for is not demand at all. It has no impact on price, which is a function of supply and demand. The mistake the article makes is counting these jobs as demand, when they really are not demanding labour. They are no more jobs than me asking you to come clean my house for free. It's a serious offer: I will be quite happy to come have you clean my house for free. But, for all meaningful purposes of the phrase, I don't think anyone considers that a real job.
- zelon88 9y ago
  Lets not forget that most companies have improved their cost savings to the point where they are trying to keep wages down. Executives are immune though. I wouldn't be surprised to discover that most companies spend 90% of their payroll on 10% of their workforce.
DiNovi 9y ago
This is completely incorrect and I'm amazed you think any of this is accurate.

geezerjay 9y ago

> The most obvious answer seems to be that the workforce keeps growing relative to the demand for that work. Interesting, and very plausible as well. Please don't get me wrong, but you happen to have any source that supports that hypothesis? I don't doubt any of what you've said and I do believe you're on to something, but I would like to read more on the subject.

saint_fiasco 9y ago
A popular book on the subject is The Two-Income Trap, by Elizabeth Warren.
- PaulHoule 9y ago
  It's a very interesting book, but I think it is more about changes that happened in the 1950-2000 time frame more than later than that. The core idea is that a two income family is less financially resilient than a one income family because (a) the extra money goes to bid up housing prices (education, healthcare, etc.), and (b) if either partner has a setback, the family is at risk of bankruptcy. Impacts of "women entering the workforce" have been relatively unexamined; one of them is that it frees up employers to practice other kinds of discrimination. For instance, many believe that black men held service jobs that got taken over by white women. You will get a woman on the Supreme Court but she will have been educated at Harvard. Pointedly, the supply of "people from high-class families" is doubled, so any bias towards hiring them can be indulged more freely. --- Some of these ideas have gotten traction in unexpected places. I was talking to a conservative friend the other day and he told me that "the gains of paying workers more would be eaten up by cost increases in housing, education and health care", which he didn't know was classic Elizabeth Warren!
  - saint_fiasco 9y ago
    It's not like Warren discovered it. Conservatives have been whining about the destruction of the family for ages. It's just that since they say that about everything, people did not take them seriously when they were right. Broken clocks and all that.
    - erroneousfunk 9y ago
      You're saying that the participation of women in the labor force is a bad thing?
      - saint_fiasco 9y ago
        Not for me. Even if wages don't go up, productivity does, and that makes things cheaper. I don't think we would be able to produce and consume so much with only half the workforce. As for the destruction of families, that's going to happen under capitalism anyway. Free markets don't like nepotism and families don't like mobility of labor. For the people who don't benefit from capitalism, it's a very bad deal to them because they gave up the safety nets of familial bonds in exchange for nothing. It's why conservatives aren't enthusiastic about capitalism and free markets (anymore?).
      - PaulHoule 9y ago
        It is what it is. It has many benefits and it is not going to be reversed, but it has negative effects on social and racial inequality. If a person educates their own child, or cooks their own meals, or provides other domestic services, that labor does not get taxed, does not contribute to making distant investors rich, and does not employ union labor. (I am male and I have done those all of those things at times.) Liz Warren points out that an "at home" family member can often get a job to supplement or replace the wages of a primary wage earner; long-term changes could be weathered by the secondary wage earner becoming the primary, or it could be a temporary job to save some money or pay off some debt. It is not a subject we have good conversations on because it is so inflammatory.
    - PaulHoule 9y ago

hashkb 9y ago

Aren't you ignoring all the unfilled positions the article is suggesting would be filled if employers paid fairly?

randomdata 9y ago
Not really. Demand, by definition, is the willingness and ability to pay the price to acquire what you are looking for. A job that doesn't pay sufficiently to attract people into the role is a job that was never part of the demand in the first place. Since the demand is not real in these cases, there is no additional demand pressure on the price. Anyone can say they want to buy a new Ferrari for $10,000, but that does not mean Ferrari should get excited about a new customer. It's all imaginary.
- deathanatos 9y ago
  But by that same definition then, is not a worker who wants more than what the employer is willing to pay then no longer part of the supply? By saying that it's just a system at an economic equilibrium, it feels like we remove any ability to make any comment on the system as a whole. It becomes just being what it is. I wonder if you can't pull in some other evidence, such as, well, if you actually did raise your pay rate to a point where there would exist a worker willing to work for that amount, and you could further prove that worker would still be able to create enough value to the employer s.t. he or she was worth hiring in the first place, and that it then only boils down to the short-sightedness of the employer for not being willing enough to offer a higher wage? (For example, something like the absurd valuations of some SV tech companies, and the millionaire they make, compared to the salary of an engineer. I personally think most places I've worked could move faster — generate more value — with better engineers, but that can't happen if you're paying "market rate" instead of paying competitively. But "enough" value is being generated, at least, people think, I guess.)
  - linkregister 9y ago
    In the realm of software, there is a limited number of "better engineers" in a given region and in the entire world. Paying more will have a zero-sum effect in the short term, simply attracting workers away from other software companies. In the longer term, it will encourage more newcomers to enter the field and spur the "less better" engineers to improve or update their skills. I'm still not clear about what you meant by "better engineers"; I'm in doubt about the theory of the 10x engineer. If you meant engineers with updated skills, then I might agree with you.

RestlessMind 9y ago

> women were actually already consumers But what about extra discretionary income which would stimulate extra demand (another car, another vacation, another gadget, home services now that both partners are working)?

shados 9y ago
A lot of the extra income is just going to housing.
- matt_wulfeck 9y ago
  And student loans, car loans, and credit cards.
randomdata 9y ago
It appears that the additional income coming into the household largely went into the existing costs that the household already had. For instance, shelter. If every home only has one earner, shelter costs can only rise to the maximum a single earner can pay. But once households started having two incomes, the the second income helped place higher bids on securing a place to live and eventually you get to the point where you cannot live somewhere without having two incomes. In some cities today, we are reaching the point where you need three incomes (see: the robot).

FussyZeus 9y ago

It seems oversimplifying to say that robots are "just another worker." When women entered the workforce, they came with similar costs to their male counterparts; wanted breaks, expected time off, lunch break, commuting time, various facilities. Robots require...well, power. They don't need breaks or bathrooms, they don't even need to go home. Hell, if you really wanted to, you could run an entire auto plant with little/no climate control in complete darkness and the robots wouldn't mind one bit. There's simply no competition between robots and humans, that's why I'm a firm believer that automation will take all the jobs and we need to figure out how to handle a post-work future before we start riots.

davidf18 9y ago
Like any other form of capital equipment, robots have other costs besides initial purchase and electricity such as maintenance and reprogramming. Various forms of farm machinery such as combines automated farm jobs for the better. So true with robots in factories and artificial intelligence that replaces lawyers for standard contracts.
- marcosdumay 9y ago
  Well, this. Widespread robots mean that the entire economy runs with the SaaS accounting. High investment, relatively low maintenance, incredibly high productivity.

sharemywin 9y ago

Except the article cites several examples of where demand isn't being met. -Farmers in Alabama are fretting that crops may rot in the ground for a lack of workers to bring in the harvest. -Despite high demand, home builders in Colorado are throttling back activity because they can’t find the workers to erect frames. -An airline canceled flights because it couldn’t find enough pilots to steer them. Those aren't demand problem but supply problems.

deleted 9y ago
[deleted]
- deleted 9y ago
  [deleted]
jdavis703 9y ago
I was on an airline that could not find enough pilots at a low enough rate to fly the planes. That was Spirit Airlines, an ultra-low cost carrier. I don't mind small, hard seats and no snacks for a quick flight, so I thought I'd save the money. Well, it turns out that Spirit has one of the highest profit margins [0] of any domestic U.S. airline, yet they decided they'd rather cancel flights than pay pilots enough to show up [1] -- they'd even rather hand out $100 vouchers to all the affected passengers than pay the pilots more. On a flight of 50 people, that's at least $5000 they lost, not to mention the staffers they had to pay (baggage handlers, gate agents, etc) that didn't actually wind up being able to complete their jobs. [0] https://www.dallasnews.com/business/airlines/2014/09/22/sevem-u-s-carriers-among-the-worlds-most-profitable-airlines https://www.dallasnews.com/business/airlines/2014/09/22/seve... [1] http://money.cnn.com/2017/05/09/news/companies/spirit-airlines-pilots/index.html http://money.cnn.com/2017/05/09/news/companies/spirit-airlin....
lotsofpulp 9y ago
It's a combination, where the demand curve never meets the supply curve at an acceptable price for the consumer. It could be due to being able to obtain a product cheaper from somewhere else due to lower labor costs (happens due to converging standards of living across the world), and it could also happen that there are alternatives, such as other jobs and/or social security disability or welfare that make doing undesirable jobs need an even higher price point to make it worthwhile.

Lagged2Death 9y ago

Wage stagnation began at the same time the number of women in the workplace started to grow ... The rate of the growing female workforce itself started to stagnant around the 90s and 2000s... Have a look over here: https://www.dol.gov/wb/stats/facts_over_time.htm https://www.dol.gov/wb/stats/facts_over_time.htm The US ratio of female/male employment experienced a strong long-term upward trend during and after WWII (1940s), and the absolute number of women working jobs in the US has climbed steadily right to the present day. The modern era of wage stagnation relative to productivity started in the 1970s, somewhat before the strongest growth in the female/male employment ratio, and continuing even after that ratio flattened out. http://www.epi.org/files/2013/ib388-figurea.jpg.538 http://www.epi.org/files/2013/ib388-figurea.jpg.538 http://www.epi.org/publication/charting-wage-stagnation/ http://www.epi.org/publication/charting-wage-stagnation/ ...a corresponding increase in demand with the supply of workers would have kept incomes moving upward... Or it could send jobs overseas to poor countries with low wages and little in the way of labor or environmental regulation.

autokad 9y ago

i think a large part is that companies are hoarding money and wealth goes there to die. if we stepped up pressure on companies to spend their money (one way or another), i think more jobs and higher wages would follow.

marcosdumay 9y ago
The US has a government running a big deficit and a population increasing it's net credit. Someone has to hoard those debits. Large companies are a bad place to concentrate money, but your entire government is working towards it.

kerbalspacepro 9y ago

How does this answer the question the author brings up in the first paragraph? >An airline canceled flights because it couldn’t find enough pilots to steer them. Despite high demand, homebuilders in Colorado are throttling back activity because they can’t find the workers to erect frames. Farmers in Alabama are fretting that crops may rot in the ground for a lack of workers to bring in the harvest. Robots can't do all those jobs, and yet the wages for those jobs haven't increased enough.

randomdata 9y ago
Economics says that demand is a consumer's desire and willingness to pay a price for a specific good or service. Offering a job at a price below what someone is willing to do it for is not demand at all. It has no impact on price, which is a function of supply and demand. The mistake the article makes is counting these jobs as demand, when they really are not demanding labour. They are no more jobs than me asking you to come clean my house for free. It's a serious offer: I will be quite happy to come have you clean my house for free. But, for all meaningful purposes of the phrase, I don't think anyone considers that a real job.
zelon88 9y ago
Lets not forget that most companies have improved their cost savings to the point where they are trying to keep wages down. Executives are immune though. I wouldn't be surprised to discover that most companies spend 90% of their payroll on 10% of their workforce.

DiNovi 9y ago

This is completely incorrect and I'm amazed you think any of this is accurate.