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Without growth you would need to increase price to continue to pay for workers who want a COLA increase. Increase price and you hemorrhage customers without a g

Without growth you would need to increase price to continue to pay for workers who want a COLA increase. Increase price and you hemorrhage customers without a growth path. Even if you kept your staff at the same level paying someone the same amount yearly would still lead to decreasing revenue due to the cost of taxes, benefits, etc increasing. In the long run the only way to run a business is to increase growth or increase cost to consumers. Since the escapist mostly ran off ad revenue (although they did have subscriptions that im guessing helps) unless they increased viewership they likely they weren't hitting the metrics they wanted. by no means does this means let go of the guy leading the team who is your likely biggest draw -- thats just stupid

Exoristos 3y ago
This seems pretty disingenuous. Keeping up with costs is just part of stable profitability and in no way implies growth at the rate modern investors demand.
- pixl97 3y ago
  The problem here is you're looking at the system as individual parts instead of the entire system. Lets imagine an entire economic system that was steady state. Why would profitability have to increase? Instead we have a system that profit must increase, and profit must increase in every component of the system constantly due to inflationary practices.
  - thereddaikon 3y ago
    That's not how that works. Raising profits is not the same as raising prices to match inflation.
    - pixl97 3y ago
      Raising profits can cause inflation. https://www.npr.org/2023/05/19/1177180972/economists-are-reconsidering-how-much-corporate-profits-drive-inflation https://www.npr.org/2023/05/19/1177180972/economists-are-rec... >He found that in 2021, corporate profits could account for about double that, nearly 60% of inflation, meaning it was not costs driving inflation. It was corporate profits. Now, some economists hear this and think this is proof that companies were just using inflation as an excuse to gouge customers.
  - johnbellone 3y ago
    You're talking about "profits" when you should really be talking about "costs". At a macro level, in a large company/business, your employees expect raises for a variety of reasons (inflation, quality of life, promos, etc). A new product or feature may require hiring additional employees. If an employee exits, you may need to spend more money to hire a replacement. In addition to all of that, there are contractual obligations with vendors, your customers may be trying to eliminate product (or leave entirely), etc. All of that raise the cost to run the business. If you want to keep your margin you need to raise your prices, cut expenses, or both.
  - astrange 3y ago
    Profit only has to increase in nominal terms, not real terms. You don't have to grow in real terms as long as you don't promise equity investors you'll try to grow. If you don't even grow nominally, you won't outrun debt and wage growth.
didibus 3y ago
How do small businesses manage this? Restaurants, coffee shops, local bookstores, small gift shops, local specialty clothes store, etc. ?
- deleted 3y ago
  [deleted]
- jay_kyburz 3y ago
  I went to a restaurant on the weekend where somebody had crossed out $16 and had hand written $18 next to all the mains.
  - didibus 3y ago
    Right, so I think people understand inflation. But apart from that? At least I didn't understand OP as meaning that growth is meant to keep lowering prices and raising wages even in the presence of inflation.
- VHRanger 3y ago
  You might notice a lot of small businesses fail. Of the ones that don't, they don't generate excessive profits for the owners. It's only a small sliver of the small business space that ends up being economically succesful.
  - AussieWog93 3y ago
    I run a small business, know plenty of small business owners and this isn't really the full story. Small businesses do frequently fail, but it's more to do with the fact that anyone can start one than the fact that they are small. If you allowed random people with no experience to start billion dollar megacorps, they'd fail too. And there are plenty that generate pretty serious profits, triple or more what you could earn in a traditional job.
- araes 3y ago
  A lot of small businesses push the price increases onward. Food distributor says all your burger patties are +10%, all your burgers are +10%, unless you think its very temporary. One benefit of local "anything" is that the prices are often way better. Ex: Live in a small town, the land rent can regularly be $1-2/sq. ft./month ($10-20/yr) while a quick on Sydney (where Gamurs is located) runs $8-10/sq. ft./month ($90-$100/yr). Frankly, Sydney's mostly already subdivided into work shares from what I've seen, and its difficult to even find a spot that's not just $500-1000 / worker / month rates (or "contact for price"). Its part of the reason Sydney's childcare is ridiculous, cause the space to even have a facility cost so much (and you have to have a min reg space per child).
vkou 3y ago
> Without growth you would need to increase price to continue to pay for workers who want a COLA increase. A business that raises prices to match inflation is not growing by any definition.

Exoristos 3y ago

This seems pretty disingenuous. Keeping up with costs is just part of stable profitability and in no way implies growth at the rate modern investors demand.

pixl97 3y ago
The problem here is you're looking at the system as individual parts instead of the entire system. Lets imagine an entire economic system that was steady state. Why would profitability have to increase? Instead we have a system that profit must increase, and profit must increase in every component of the system constantly due to inflationary practices.
- thereddaikon 3y ago
  That's not how that works. Raising profits is not the same as raising prices to match inflation.
  - pixl97 3y ago
    Raising profits can cause inflation. https://www.npr.org/2023/05/19/1177180972/economists-are-reconsidering-how-much-corporate-profits-drive-inflation https://www.npr.org/2023/05/19/1177180972/economists-are-rec... >He found that in 2021, corporate profits could account for about double that, nearly 60% of inflation, meaning it was not costs driving inflation. It was corporate profits. Now, some economists hear this and think this is proof that companies were just using inflation as an excuse to gouge customers.
- johnbellone 3y ago
  You're talking about "profits" when you should really be talking about "costs". At a macro level, in a large company/business, your employees expect raises for a variety of reasons (inflation, quality of life, promos, etc). A new product or feature may require hiring additional employees. If an employee exits, you may need to spend more money to hire a replacement. In addition to all of that, there are contractual obligations with vendors, your customers may be trying to eliminate product (or leave entirely), etc. All of that raise the cost to run the business. If you want to keep your margin you need to raise your prices, cut expenses, or both.
- astrange 3y ago
  Profit only has to increase in nominal terms, not real terms. You don't have to grow in real terms as long as you don't promise equity investors you'll try to grow. If you don't even grow nominally, you won't outrun debt and wage growth.

didibus 3y ago

How do small businesses manage this? Restaurants, coffee shops, local bookstores, small gift shops, local specialty clothes store, etc. ?

deleted 3y ago
[deleted]
jay_kyburz 3y ago
I went to a restaurant on the weekend where somebody had crossed out $16 and had hand written $18 next to all the mains.
- didibus 3y ago
  Right, so I think people understand inflation. But apart from that? At least I didn't understand OP as meaning that growth is meant to keep lowering prices and raising wages even in the presence of inflation.
VHRanger 3y ago
You might notice a lot of small businesses fail. Of the ones that don't, they don't generate excessive profits for the owners. It's only a small sliver of the small business space that ends up being economically succesful.
- AussieWog93 3y ago
  I run a small business, know plenty of small business owners and this isn't really the full story. Small businesses do frequently fail, but it's more to do with the fact that anyone can start one than the fact that they are small. If you allowed random people with no experience to start billion dollar megacorps, they'd fail too. And there are plenty that generate pretty serious profits, triple or more what you could earn in a traditional job.
araes 3y ago
A lot of small businesses push the price increases onward. Food distributor says all your burger patties are +10%, all your burgers are +10%, unless you think its very temporary. One benefit of local "anything" is that the prices are often way better. Ex: Live in a small town, the land rent can regularly be $1-2/sq. ft./month ($10-20/yr) while a quick on Sydney (where Gamurs is located) runs $8-10/sq. ft./month ($90-$100/yr). Frankly, Sydney's mostly already subdivided into work shares from what I've seen, and its difficult to even find a spot that's not just $500-1000 / worker / month rates (or "contact for price"). Its part of the reason Sydney's childcare is ridiculous, cause the space to even have a facility cost so much (and you have to have a min reg space per child).

vkou 3y ago

> Without growth you would need to increase price to continue to pay for workers who want a COLA increase. A business that raises prices to match inflation is not growing by any definition.