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Right, this is where this sort of blanket extrapolation breaks down. Has the average productivity grown that much? Sure, I can believe that. Has the producti

Right, this is where this sort of blanket extrapolation breaks down. Has the average productivity grown that much? Sure, I can believe that. Has the productivity at the lower margin grown that much? I seriously doubt that. The value created by stocking shelves at wal-mart just doesn't really change over time. There's a lot of labor on the lower end that is a solved problem with all the productivity wrung out of it decades ago.

onlyrealcuzzo 5y ago
It absolutely does! If Wal-Mart can pay more money for something, they would be /willing/ to pay it. The same stocking of shelves, they are able to capture more value from. Unskilled laborers are just not able to capture that value from Wal-Mart because there is an abundance of unskilled labor and the average person (the laborer) has to derive income from work. They can't just say, "Puh, this isn't worth it any more!" In addition, there's been a ton of improvements in productivity for warehouse workers. They are absolutely doing more work in the same amount of time. The same is true at most big businesses. That being said - at $26 an hour, there would be A LOT more pressure to eliminate more jobs.
- celtain 5y ago
  >there is an abundance of unskilled labor and the average person (the laborer) has to derive income from work. They can't just say, "Puh, this isn't worth it any more!" This was true throughout the 2010s, but under full employment even a low-wage/"unskilled" worker can realistically go get a different job if they don't like the one they have. There's probably an Amazon warehouse nearby that would hire them at a higher wage, or a restaurant if they're willing to do a different kind of work.
orangeoxidation 5y ago
> Has the productivity at the lower margin grown that much? I seriously doubt that. That's the problem. The minimum wage is a legal instrument, not just an economic process. It is designed for the lower margin to be "overpaid" over what they could get from the market otherwise. It basically says "everyone working should get at least this much of our collective production". This is what we have decided our society should work like. Our collective productivity increased much faster than minimal wage, making the minimal wage worker much poorer by comparison.
- jrsj 5y ago
  We’ve also completely failed to provide adequate opportunities for these workers to gain the skills and education to be able to do something more valuable with their time. That’s a problem the minimum wage can’t solve. There’s a threshold where people will just become unemployable under that model without more investment in them.
  - lostapathy 5y ago
    I completely agree. However, raising the minimum wage does nothing to address the skills gap at the bottom. If anything, one could argue raising the minimum wage would reduce incentive to acquire better skills and get a better job. Why put in the work to level up if those better jobs don't pay appreciably better anyway?
tshaddox 5y ago
Won’t the productivity of stocking shelves go up if, for example, technology makes grocery stores more profitable? Perhaps technology helps stores order locally customized inventory that will sell better (and waste less), or perhaps delivery or curbside pickup systems help stores compete better against online stores. Even packaging improvements could increase productivity. The fact that the stores themselves are physically able in practice to enjoy this increase in productivity without increasing pay to the people stocking shelves says very little about how the productivity of stocking shelves has changed.
- jrsj 5y ago
  Up to a point this would work but there is a point where stocking shelves at all is no longer worth it when the labor reaches a certain price, and they would probably just start tossing pallets of goods directly onto the sales floor and only support self checkout. And then probably invest in robotics to automate moving the pallets around. You could have an entire Walmart ran by fewer than 10 employees
  - tshaddox 5y ago
    Sure, robots might be able to do it cheaper in the near future, but that’s unrelated to the question of whether productivity has gone up.
    - jrsj 5y ago
      There are many things that may just not get done at all though if they can’t be automated, or if automating them would be too costly. Stocking shelves in particular is probably one of those things. It’s hard to argue the labor is worth $26 an hour based on the total productivity increase of the corporation if they would just stop having you do it at all if it cost that much. The idea that an individual workers productivity is derived from the total productivity of the business isn’t entirely accurate. In the case of stocking shelves, the value is mostly aesthetics and executing a marketing strategy. The value of stocking shelves is based on the value that stocked shelves provide, which doesn’t increase linearly with the productivity of a store.

onlyrealcuzzo 5y ago

It absolutely does! If Wal-Mart can pay more money for something, they would be /willing/ to pay it. The same stocking of shelves, they are able to capture more value from. Unskilled laborers are just not able to capture that value from Wal-Mart because there is an abundance of unskilled labor and the average person (the laborer) has to derive income from work. They can't just say, "Puh, this isn't worth it any more!" In addition, there's been a ton of improvements in productivity for warehouse workers. They are absolutely doing more work in the same amount of time. The same is true at most big businesses. That being said - at $26 an hour, there would be A LOT more pressure to eliminate more jobs.

celtain 5y ago
>there is an abundance of unskilled labor and the average person (the laborer) has to derive income from work. They can't just say, "Puh, this isn't worth it any more!" This was true throughout the 2010s, but under full employment even a low-wage/"unskilled" worker can realistically go get a different job if they don't like the one they have. There's probably an Amazon warehouse nearby that would hire them at a higher wage, or a restaurant if they're willing to do a different kind of work.

orangeoxidation 5y ago

> Has the productivity at the lower margin grown that much? I seriously doubt that. That's the problem. The minimum wage is a legal instrument, not just an economic process. It is designed for the lower margin to be "overpaid" over what they could get from the market otherwise. It basically says "everyone working should get at least this much of our collective production". This is what we have decided our society should work like. Our collective productivity increased much faster than minimal wage, making the minimal wage worker much poorer by comparison.

jrsj 5y ago
We’ve also completely failed to provide adequate opportunities for these workers to gain the skills and education to be able to do something more valuable with their time. That’s a problem the minimum wage can’t solve. There’s a threshold where people will just become unemployable under that model without more investment in them.
- lostapathy 5y ago
  I completely agree. However, raising the minimum wage does nothing to address the skills gap at the bottom. If anything, one could argue raising the minimum wage would reduce incentive to acquire better skills and get a better job. Why put in the work to level up if those better jobs don't pay appreciably better anyway?

tshaddox 5y ago

Won’t the productivity of stocking shelves go up if, for example, technology makes grocery stores more profitable? Perhaps technology helps stores order locally customized inventory that will sell better (and waste less), or perhaps delivery or curbside pickup systems help stores compete better against online stores. Even packaging improvements could increase productivity. The fact that the stores themselves are physically able in practice to enjoy this increase in productivity without increasing pay to the people stocking shelves says very little about how the productivity of stocking shelves has changed.

jrsj 5y ago
Up to a point this would work but there is a point where stocking shelves at all is no longer worth it when the labor reaches a certain price, and they would probably just start tossing pallets of goods directly onto the sales floor and only support self checkout. And then probably invest in robotics to automate moving the pallets around. You could have an entire Walmart ran by fewer than 10 employees
- tshaddox 5y ago
  Sure, robots might be able to do it cheaper in the near future, but that’s unrelated to the question of whether productivity has gone up.
  - jrsj 5y ago
    There are many things that may just not get done at all though if they can’t be automated, or if automating them would be too costly. Stocking shelves in particular is probably one of those things. It’s hard to argue the labor is worth $26 an hour based on the total productivity increase of the corporation if they would just stop having you do it at all if it cost that much. The idea that an individual workers productivity is derived from the total productivity of the business isn’t entirely accurate. In the case of stocking shelves, the value is mostly aesthetics and executing a marketing strategy. The value of stocking shelves is based on the value that stocked shelves provide, which doesn’t increase linearly with the productivity of a store.