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I may not be an economist, but I think this does not make sense. If there is a worker shortage, do all of the workers go to work and say "give me more money"?

I may not be an economist, but I think this does not make sense. If there is a worker shortage, do all of the workers go to work and say "give me more money"? I would also contend there would be no reason for say, walmart to suddenly offer more money just because everyone has been ordered to stay home. If there is an _actual_ shortage, increasing pay does not just fabricate workers. I have relatives who are essential (specialized nurses, and hospice nurses). Their pay has not changed, in fact, their actual wages have fallen through the floor as they are working 12-16 hour days instead of 10-12 hour days (when they are supposed to work 8 hours a day), so their hourly wage (they do not get paid for all that time they are charting, after hours, at home) has dropped significantly.

ceejayoz 6y ago
> If there is an _actual_ shortage, increasing pay does not just fabricate workers. Sure it does. For some people, it means switching from stay-at-home parenting to daycare financially sensible. For someone on social security, it might mean temporarily going back to work is more attractive than it was. People go from not seeking jobs to seeking jobs all the time.
- monocasa 6y ago
  Demand scaling doesn't happen instantly. For instance, how are you going to get new CNAs (even reupped certs) right now when the schools are closed?
  - ceejayoz 6y ago
    Things like CNAs are a small (important, but small) portion of what we're deeming "essential workers" in this pandemic. The definition includes a vast set of un-credentialed workers; people at meat packing plants, grocery stores, cleaning staff, etc. (Again, there will be licensed CNAs not working due to the cost of things like daycare. Raising wages changes that calculus, too.)
    - monocasa 6y ago
      Even then, demand scaling doesn't happen instantly. Markets aren't perfectly elastic.
      - ceejayoz 6y ago
        They're not perfectly elastic, but they're not inelastic either. As an example, NYC was offering $10k/week for travel nurses. It's clear that pay can drive labor supply, even if it's not perfect.
        monocasa 6y ago
        Did that work? Did they get the nurses they were expecting from that program?
        ceejayoz 6y ago
        Yes. Travel nursing (high pay, short-term contract) has been a thing for decades.
        monocasa 6y ago
        Just because it's been a thing for decades doesn't mean it instantly fixes demand in this case. And the fact that a quick google search is showing new travel nurse jobs posted a week ago in new york, despite their curve dropping a couple months ago, is telling. It seems like they were unable to meet demand with that program.
        ceejayoz 6y ago
        There are always travel nurse jobs open in NYC. The nature of a short-term contract is that there's always churn. They are not always $10k/week.
        monocasa 6y ago
save_ferris 6y ago
Those examples you cite seem pretty contrived to me. A more real-world scenario would be more like a hospital facing a critical nursing shortage improving its compensation package for new hires. They probably wouldn’t bump current nurses pay unless they feared an exodus, but most companies operate this way. Software firms do this all the time because the demand for developers is so high. A developer candidate that knows how to negotiate effectively can usually hit the top of their pay band or even exceed it. But the caveat is that it takes a job hop to get paid, which I assume is true for most other industries.
jfengel 6y ago
That's thinking like an economist. As opposed to an Internet "economist", who got through the first two weeks of Econ 101 (where everything is perfectly elastic) and stopped there. Real economists use more complicated models -- about which there is genuine debate and enormous uncertainty. So they don't make simple, confident statements.
pjc50 6y ago
> in fact, their actual wages have fallen through the floor as they are working 12-16 hour days instead of 10-12 hour days (when they are supposed to work 8 hours a day), so their hourly wage (they do not get paid for all that time they are charting, after hours, at home) has dropped significantly. In other words, wage theft has rampantly increased?

ceejayoz 6y ago

> If there is an _actual_ shortage, increasing pay does not just fabricate workers. Sure it does. For some people, it means switching from stay-at-home parenting to daycare financially sensible. For someone on social security, it might mean temporarily going back to work is more attractive than it was. People go from not seeking jobs to seeking jobs all the time.

monocasa 6y ago
Demand scaling doesn't happen instantly. For instance, how are you going to get new CNAs (even reupped certs) right now when the schools are closed?
- ceejayoz 6y ago
  Things like CNAs are a small (important, but small) portion of what we're deeming "essential workers" in this pandemic. The definition includes a vast set of un-credentialed workers; people at meat packing plants, grocery stores, cleaning staff, etc. (Again, there will be licensed CNAs not working due to the cost of things like daycare. Raising wages changes that calculus, too.)
  - monocasa 6y ago
    Even then, demand scaling doesn't happen instantly. Markets aren't perfectly elastic.
    - ceejayoz 6y ago
      They're not perfectly elastic, but they're not inelastic either. As an example, NYC was offering $10k/week for travel nurses. It's clear that pay can drive labor supply, even if it's not perfect.
      - monocasa 6y ago
        Did that work? Did they get the nurses they were expecting from that program?
        ceejayoz 6y ago
        Yes. Travel nursing (high pay, short-term contract) has been a thing for decades.
        monocasa 6y ago
        Just because it's been a thing for decades doesn't mean it instantly fixes demand in this case. And the fact that a quick google search is showing new travel nurse jobs posted a week ago in new york, despite their curve dropping a couple months ago, is telling. It seems like they were unable to meet demand with that program.
        ceejayoz 6y ago
        There are always travel nurse jobs open in NYC. The nature of a short-term contract is that there's always churn. They are not always $10k/week.
        monocasa 6y ago

save_ferris 6y ago

Those examples you cite seem pretty contrived to me. A more real-world scenario would be more like a hospital facing a critical nursing shortage improving its compensation package for new hires. They probably wouldn’t bump current nurses pay unless they feared an exodus, but most companies operate this way. Software firms do this all the time because the demand for developers is so high. A developer candidate that knows how to negotiate effectively can usually hit the top of their pay band or even exceed it. But the caveat is that it takes a job hop to get paid, which I assume is true for most other industries.

jfengel 6y ago

That's thinking like an economist. As opposed to an Internet "economist", who got through the first two weeks of Econ 101 (where everything is perfectly elastic) and stopped there. Real economists use more complicated models -- about which there is genuine debate and enormous uncertainty. So they don't make simple, confident statements.

pjc50 6y ago

> in fact, their actual wages have fallen through the floor as they are working 12-16 hour days instead of 10-12 hour days (when they are supposed to work 8 hours a day), so their hourly wage (they do not get paid for all that time they are charting, after hours, at home) has dropped significantly. In other words, wage theft has rampantly increased?