5 ms·

I disagree. There are two potential causes for the labor shortage: paying people not to work (ie increased government handout), and people retiring early. Bot

by kyrra 5y ago

I disagree. There are two potential causes for the labor shortage: paying people not to work (ie increased government handout), and people retiring early. Both of these things have happened during the pandemic. I recommend looking at the labor participation rate over the last 5 years. We dropped from 63% to 61.5 %. https://tradingeconomics.com/united-states/labor-force-participation-rate https://tradingeconomics.com/united-states/labor-force-parti...

popcube 5y ago
do this means companies should pay more to attract people ?
nopenopenopeno 5y ago
You haven’t defended your “disagreement.” Even if your points did hold up, they still don’t counter parent’s claims. American wages have been stagnant for over 30 years while benefits, pensions, job security, and working conditions have continued to erode. If you think that’s not going to have any consequences, you’re lying to yourself. Unemployment insurance only lasts 6 months, is very difficult to live on for low wage workers, and people just generally know that not working is very bad because it wrecks your job history and resume. Additionally, the majority of Americans’ finances are in very poor shape, which is why Biden was forced to extend the moratorium on student loan payments. To take your word for it, we would also have to explain why employment was ever so high to begin with.
- kyrra 5y ago
  What do you mean by stagnant? Do you mean and individual is stuck at a certain pay level their entire life? Or do you mean that a given quintile of income has been stagnant over time? Here's a quote from basic economics (chapter 10): > The University of Michigan study found that, among working Americans who were in the bottom 20 percent in income in 1975, approximately 95 percent had risen out of that bracket by 1991—including 29 percent who had reached the top quintile by 1991, compared to only 5 percent who still remained in the bottom quintile. The largest absolute amount of increase in income between 1975 and 1991 was among those people who were initially in the bottom quintile in 1975 and the least absolute increase in income was among those who were initially in the top quintile in 1975. > In other words, the incomes of people who were initially at the bottom rose more than the incomes of people who were initially at the top. This is the direct opposite of the picture presented by Census data, based on following income brackets over time, instead of following the people who are moving in and out of those brackets. > Similar patterns appeared in statistics from the Internal Revenue Service, which also followed given individuals. The IRS found that between 1996 and 2005 the income of individuals who had been in the bottom 20 percent of income tax filers in 1996 had increased by 91 percent by 2005, and the income of those individuals who were in the top one percent in 1996 had fallen by 26 percent.{316} It may seem almost impossible that the data from the Bureau of the Census and the data from the IRS and the University of Michigan can all be correct, but they are. Studies of income brackets over time and studies of individual people over time are measuring fundamentally different things that are often confused with one another.
  - refurb 5y ago
    This kind of “moving up” in income brackets is entirely expected. Would an 18 year old be expected to make the same money as a 50 year old? Even the most unskilled laborer sees pay increases over time.
  - JKCalhoun 5y ago
    Compensation has been stagnant, even regressive with respect to productivity for four decades now: https://www.epi.org/productivity-pay-gap/ https://www.epi.org/productivity-pay-gap/
neilwilson 5y ago
Correct. People have a “no deal I’ll wait” option. Same as business as always had. If we maintain that then we will have a free market in labour. Pay the price or don’t get any. Or spend the capital automating and working out how to do more with less. It is supposed to be capitalism after all.
- gruez 5y ago
  > Correct. People have a “no deal I’ll wait” option. >Same as business as always had. "business as always had" that option? Clearly they don't, otherwise they'll never cave to strikes.
  - neilwilson 5y ago
    Do they always instantly cave in to strikes? Do strikers permanently stay on strike on a barely subsistence wage? Or do they finally come together to share the spoils of mutually beneficial activity? Which is what a market is supposed to be about.
- JKCalhoun 5y ago
  Interesting, in real estate we are familiar with "buyer's markets" and "seller's markets". Seems like in the labor force, a "worker's market" only comes around once in a lifetime. For most of my life it's been an "employer's market".
JamesLeonis 5y ago
> paying people not to work (ie increased government handout) 83% of the value of all the 2020-21 Paycheck Protection Program loans were forgiven as of December 19th, 2021 [1]. That's a total value of $653,038,613,899. That's nearly as large as the 2008 bailouts. Even that doesn't tell the whole story because 94% of the 2020 loans alone were forgiven, and 2021 is on track to meet it. [1]: https://www.sba.gov/sites/default/files/2021-12/2021.12.19_Weekly%20Forgiveness%20Report_Public-508.pdf https://www.sba.gov/sites/default/files/2021-12/2021.12.19_W...
- gruez 5y ago
  I don's see how this contradicts the parent's comment? He's presumably talking about the unemployment subsidy that the federal government offered.
  - JamesLeonis 5y ago
    Both the parent comment and the OP article talk about the federal subsidy, which both imply drive low labor participation rates. You can read the same argument from years back out of the Brookings Institute, just substitute COVID subsidies with Opioids [1] as the cause of depressed labor participation. My counter: The labor-force participation is still at historic highs compared to the 1950s through the early 70s, but not as high as its peak in 2000 [2]. Combined with relatively normal unemployment historically [3] the market for labor is squeezed. After 40 years of neoliberal policy dismantling state programs they've released as much marginal labor as possible, and we are all now seeing a return to historic norms. [1]: https://www.brookings.edu/bpea-articles/where-have-all-the-workers-gone-an-inquiry-into-the-decline-of-the-u-s-labor-force-participation-rate/ https://www.brookings.edu/bpea-articles/where-have-all-the-w... [2]: https://fred.stlouisfed.org/graph/?g=KfNL https://fred.stlouisfed.org/graph/?g=KfNL [3]: https://fred.stlouisfed.org/series/UNRATE https://fred.stlouisfed.org/series/UNRATE
    - renewiltord 5y ago
      But the 1950s had very few working women. One would imagine that, having added women to the numerator, a 60% now means society has changed a lot from a 60% then. That is, the two 60%s tell different stories. Of course, the right way for me to see this is if housewifery rate has returned to the baseline, or if female labor participation rate is similar to what it was, or if households can be supported and are supported in the same way as the past. My impression was that the rapid growth in labor force participation was because of women. But I have not recently tested if that is correct. M
akagusu 5y ago
Let me see if I understood well. The problem is not companies practicing wave slavering, but government social aid and early retirement? Is this you are saying?
- deleted 5y ago
  [deleted]
xphos 5y ago
Anyone who makes an argument based on something and backs it up with one data point about something as complicated as labor supply isn't making a full thought out argument. The argument your making is that the US stimulus checks are so great that business just can't compete with laziness. Yet the total cumulative stimulus is less then the poverty line. If business can pay someone above that line than maybe there labor is better spent elsewhere or at least that time with there families. Now that's harsh but that's the way that your argument comes across. Now the original post balances with reason by saying stimulus has given people room to not work at low paying jobs but it's not necessary because they are lazy but because they jobs they work suck and pay like crap. Hence the reason business will raise wages because that is the major problem. Working retail where people are rude and mean is not pleasant and if you want people to deal with unpleasant people you have to pay them more
piyh 5y ago
And basic stuff like shitty family leave policies drive women out of the workforce.

by kyrra 5y ago

popcube 5y ago

do this means companies should pay more to attract people ?

nopenopenopeno 5y ago

You haven’t defended your “disagreement.” Even if your points did hold up, they still don’t counter parent’s claims. American wages have been stagnant for over 30 years while benefits, pensions, job security, and working conditions have continued to erode. If you think that’s not going to have any consequences, you’re lying to yourself. Unemployment insurance only lasts 6 months, is very difficult to live on for low wage workers, and people just generally know that not working is very bad because it wrecks your job history and resume. Additionally, the majority of Americans’ finances are in very poor shape, which is why Biden was forced to extend the moratorium on student loan payments. To take your word for it, we would also have to explain why employment was ever so high to begin with.

kyrra 5y ago
What do you mean by stagnant? Do you mean and individual is stuck at a certain pay level their entire life? Or do you mean that a given quintile of income has been stagnant over time? Here's a quote from basic economics (chapter 10): > The University of Michigan study found that, among working Americans who were in the bottom 20 percent in income in 1975, approximately 95 percent had risen out of that bracket by 1991—including 29 percent who had reached the top quintile by 1991, compared to only 5 percent who still remained in the bottom quintile. The largest absolute amount of increase in income between 1975 and 1991 was among those people who were initially in the bottom quintile in 1975 and the least absolute increase in income was among those who were initially in the top quintile in 1975. > In other words, the incomes of people who were initially at the bottom rose more than the incomes of people who were initially at the top. This is the direct opposite of the picture presented by Census data, based on following income brackets over time, instead of following the people who are moving in and out of those brackets. > Similar patterns appeared in statistics from the Internal Revenue Service, which also followed given individuals. The IRS found that between 1996 and 2005 the income of individuals who had been in the bottom 20 percent of income tax filers in 1996 had increased by 91 percent by 2005, and the income of those individuals who were in the top one percent in 1996 had fallen by 26 percent.{316} It may seem almost impossible that the data from the Bureau of the Census and the data from the IRS and the University of Michigan can all be correct, but they are. Studies of income brackets over time and studies of individual people over time are measuring fundamentally different things that are often confused with one another.
- refurb 5y ago
  This kind of “moving up” in income brackets is entirely expected. Would an 18 year old be expected to make the same money as a 50 year old? Even the most unskilled laborer sees pay increases over time.
- JKCalhoun 5y ago
  Compensation has been stagnant, even regressive with respect to productivity for four decades now: https://www.epi.org/productivity-pay-gap/ https://www.epi.org/productivity-pay-gap/

neilwilson 5y ago

Correct. People have a “no deal I’ll wait” option. Same as business as always had. If we maintain that then we will have a free market in labour. Pay the price or don’t get any. Or spend the capital automating and working out how to do more with less. It is supposed to be capitalism after all.

gruez 5y ago
> Correct. People have a “no deal I’ll wait” option. >Same as business as always had. "business as always had" that option? Clearly they don't, otherwise they'll never cave to strikes.
- neilwilson 5y ago
  Do they always instantly cave in to strikes? Do strikers permanently stay on strike on a barely subsistence wage? Or do they finally come together to share the spoils of mutually beneficial activity? Which is what a market is supposed to be about.
JKCalhoun 5y ago
Interesting, in real estate we are familiar with "buyer's markets" and "seller's markets". Seems like in the labor force, a "worker's market" only comes around once in a lifetime. For most of my life it's been an "employer's market".

JamesLeonis 5y ago

> paying people not to work (ie increased government handout) 83% of the value of all the 2020-21 Paycheck Protection Program loans were forgiven as of December 19th, 2021 [1]. That's a total value of $653,038,613,899. That's nearly as large as the 2008 bailouts. Even that doesn't tell the whole story because 94% of the 2020 loans alone were forgiven, and 2021 is on track to meet it. [1]: https://www.sba.gov/sites/default/files/2021-12/2021.12.19_Weekly%20Forgiveness%20Report_Public-508.pdf https://www.sba.gov/sites/default/files/2021-12/2021.12.19_W...

gruez 5y ago
I don's see how this contradicts the parent's comment? He's presumably talking about the unemployment subsidy that the federal government offered.
- JamesLeonis 5y ago
  Both the parent comment and the OP article talk about the federal subsidy, which both imply drive low labor participation rates. You can read the same argument from years back out of the Brookings Institute, just substitute COVID subsidies with Opioids [1] as the cause of depressed labor participation. My counter: The labor-force participation is still at historic highs compared to the 1950s through the early 70s, but not as high as its peak in 2000 [2]. Combined with relatively normal unemployment historically [3] the market for labor is squeezed. After 40 years of neoliberal policy dismantling state programs they've released as much marginal labor as possible, and we are all now seeing a return to historic norms. [1]: https://www.brookings.edu/bpea-articles/where-have-all-the-workers-gone-an-inquiry-into-the-decline-of-the-u-s-labor-force-participation-rate/ https://www.brookings.edu/bpea-articles/where-have-all-the-w... [2]: https://fred.stlouisfed.org/graph/?g=KfNL https://fred.stlouisfed.org/graph/?g=KfNL [3]: https://fred.stlouisfed.org/series/UNRATE https://fred.stlouisfed.org/series/UNRATE
  - renewiltord 5y ago
    But the 1950s had very few working women. One would imagine that, having added women to the numerator, a 60% now means society has changed a lot from a 60% then. That is, the two 60%s tell different stories. Of course, the right way for me to see this is if housewifery rate has returned to the baseline, or if female labor participation rate is similar to what it was, or if households can be supported and are supported in the same way as the past. My impression was that the rapid growth in labor force participation was because of women. But I have not recently tested if that is correct. M

akagusu 5y ago

Let me see if I understood well. The problem is not companies practicing wave slavering, but government social aid and early retirement? Is this you are saying?

deleted 5y ago
[deleted]

xphos 5y ago

Anyone who makes an argument based on something and backs it up with one data point about something as complicated as labor supply isn't making a full thought out argument. The argument your making is that the US stimulus checks are so great that business just can't compete with laziness. Yet the total cumulative stimulus is less then the poverty line. If business can pay someone above that line than maybe there labor is better spent elsewhere or at least that time with there families. Now that's harsh but that's the way that your argument comes across. Now the original post balances with reason by saying stimulus has given people room to not work at low paying jobs but it's not necessary because they are lazy but because they jobs they work suck and pay like crap. Hence the reason business will raise wages because that is the major problem. Working retail where people are rude and mean is not pleasant and if you want people to deal with unpleasant people you have to pay them more

piyh 5y ago

And basic stuff like shitty family leave policies drive women out of the workforce.