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No, slashing the labor pool is supposed to increase the leverage labor has allowing labor to demand higher salaries. It doesn't just make salaries go up on thei
by Avshalom 4y ago
No, slashing the labor pool is supposed to increase the leverage labor has allowing labor to demand higher salaries. It doesn't just make salaries go up on their own. But as long as you can ignore the demands of that labor pool it doesn't necessarily do anything.
That said they slash jobs, but because it's specifically-skilled labor slashing jobs also slashes the labor pool, when there's no jobs people either never develop the skills/experience or they leave the field --and don't come back-- when they get laid off.
- semiquaver 4y ago> No, slashing the labor pool is supposed to increase the leverage labor has allowing labor to demand higher salaries. It doesn't just make salaries go up on their own. This is an odd straw man. Who would claim that any economic mechanism happens “on its own”? > as long as you can ignore the demands of that labor pool it doesn't necessarily do anything. _Specifically with regard to salaries_ this article very clearly says that the opposite is occurring: > the companies agreed to a 24 percent pay increase by 2024, annual $1,000 bonuses, and a freeze on health-care costs. > […] > The freight carriers can afford to make concessions on pay. It isn’t that painful to increase wages by a sizable amount when you’ve recently slashed your head count by 30 percent It seems weird to argue in the hypothetical about what the railroads’ actions might do to constrain salaries when there is ample evidence that’s not true.