5 ms·

That's a lot of economic theorizing, but to me, it doesn't seem to be substantiated all that well. You can just as well argue that labor is getting more expens

That's a lot of economic theorizing, but to me, it doesn't seem to be substantiated all that well. You can just as well argue that labor is getting more expensive in the West because of two non-market pressures. First, we have a multitude of government programs that seek to eliminate extreme poverty, so there are fewer people who are desperate to take any job for any money. Second, you have consumer protection policies that make it genuinely expensive to, say, be a HVAC repairman. Educational requirements, permits, licensing, business insurance, waste disposal, etc. On my neighborhood Facebook group, every time someone asks for recommendations for menial, minimally-skilled backyard labor, they always insist the person needs to be licensed, bonded, and insured. And then, they're surprised that it costs $10,000 to paint a fence.

WarOnPrivacy 11mo ago
> First, we have a multitude of government programs that seek to eliminate extreme poverty, Clarification: In some places we absolutely do. In others we absolutely do not. > so there are fewer people who are desperate to take any job for any money. I think is is better reflective: There is huge surplus of employers have that set up systems that insure they do not hire qualified people. Job portals that auto-trash applications from unwanted applicants (1st time, most minimal of crim rec, wrong zip codes) are one massive example. source: me+kids spent a decade in red state, hunger-level poverty. kids who got zero replies during months/years of entry level job apps.
aeonfox 11mo ago
> eliminate extreme poverty, so there are fewer people who are desperate to take any job for any money One way to eliminate extreme poverty and increase skilled labour, is to ensure children have enough nutrition, health, schooling, and funds to pursue skilled worked in adult life, which usually involves making time outside of work, adequate health, some prerequisite education, and a sufficient financial buffer to actually upskill. A second thing is Baumol's Cost Disease. If there are other industries that are more rewarding that require less effort, no-one is going to pursue those options. Why be a clever guy who makes a product (or becomes a HVAC repairer, electrician, etc.) when you can get a comfy job at a FAANG (or whatever the acronym is today). You could sub in benefits here, but I don't think people are thriving on benefits in the US. But I'm an outsider, so I wouldn't know. But there's also a secret third thing that people don't often consider, which is the culture. If there's a culture that doesn't privilege working hard, or educational attainment, etc., people won't seek those things.
WarOnPrivacy 11mo ago
> Second, you have consumer protection policies that make it genuinely expensive to, say, be a HVAC repairman. clarification: Of the things that make it expensive to run an HVAC repair company, consumer protection related expenses are super far down the list. source: 2 decades (on/off) supporting a close friend's regional hvac biz, national geothermal interests.
- ApolloFortyNine 11mo ago
  A quick Google says it takes 4 years to get a license to be an HVAC technician in my state. I understand large installs at businesses are a different problem, and granted I've only ever installed a mini split, but that was hardly rocket science. And home installs are likely what most people are thinking of here. In Japan you can get minisplit's installed for $1k a unit, here you regularly find quotes over $10k. Something's gone wrong somewhere.
  - locknitpicker 11mo ago
    > In Japan you can get minisplit's installed for $1k a unit, here you regularly find quotes over $10k. How much does the unit cost? What work does it take to install it? How large does it need to be to support your home? What are the energy needs of your typical home in Japan vs your home town? Those are the key factors, not how many years someone spends in tradeschool.
    - rcxdude 11mo ago
      The units themselves are not significantly more expensive nor any more difficult or time consuming to install.
    - deleted 11mo ago
      [deleted]
    - fragmede 11mo ago
      Why would those be dramatically different anywhere? It's the same few choices of mini-splits from the same few Japanese/whatever conglomerates across the world, with known cooling abilites (measured in the same units, BTUs) and with known energy consumption (kwh) (and power in watts). The hotter the place you live in, the more power it's gonna draw, and the more BTUs you'll need. Also the bigger the room, the more BTU you'll need. Fujitsu and Mitsubishi both have popular units that are basically the same the whole world over, with minor regional changes. There really isn't that much variation though. There are obvious differences, a mini-split in a hot part of the world is going to be working harder than a mini-split in a cooler part of the world. Humidity will differ as well. It's a large home appliance. You need a pair of strong people to drive over to the customer's house, bring it in their house, locate the right place to install it, unbox it, support it, wire/pipe it up correctly, and then give it power. The Big Mac index gives the difference in price between Japan in the US to be $5.79 vs $3.11 in JP (in 2025), and meanwhile $1k vs $10 is, well, 10x. There's something at work here, but it's not due to variations in the difficulty of unboxing a large metal thing, drilling holes, running some tubing and then powering it on.
landl0rd 11mo ago
Why do you think people insist someone needs to be licensed, bonded, and insured? It's not really a quality question, it's CYA, a direct response to the rise of ambulance-chasers and increasingly-ridiculous jury awards. Morgan and Morgan are probably doing as much economic damage here as Baumol.
- XorNot 11mo ago
  They insist on that because if someone does work on your property they might destroy your property Yeah it's CYA: the ass in question is yours. The guy who burns your house down without insurance will just file bankruptcy. You're the one left with the ashes.
  - jmb99 11mo ago
    Would your homeowners insurance not cover that? Mine would.
    - XorNot 11mo ago
      You might want to really do a careful read of your policy, because almost all of them have provisions about requiring work to be completed by licensed tradespeople.
      - jmb99 11mo ago
        I've heard people say this before, so a few years back I got all of my friends and family to send me a full copy of their insurance policies. 0% had any lines saying anything regarding work being performed by licensed tradespeople, or even that work must be done to building/etc codes. This was across multiple insurance companies in 3 provinces (Canada), for policies on condos, semi-detached, and detached homes. I have my doubts that such a thing exists outside of extreme circumstances or internet commenters' imaginations.
        XorNot 11mo ago
stein1946 11mo ago
> You can just as well argue that labor is getting more expensive in the West because of two non-market pressures. First, we have a multitude of government programs that seek to eliminate extreme poverty, so there are fewer people who are desperate to take any job for any money. Second, you have consumer protection policies that make it genuinely expensive to, say, be a HVAC repairman. Educational requirements, permits, licensing, business insurance, waste disposal, etc. How's what you wrote substantiated at all? To me it seems you are suggesting we let people starve so that labour you characterize as "minimally-skilled backyard" is cheap. You also seem to be suggesting that consumer protection policies need to go as well. I assume we are going to trust the end consumer to do due diligence cause "they know whats better for them?" If they get a quote of 10k and they cannot get a better one, they might as well start writing that check.
- toomuchtodo 11mo ago
  I don’t think that’s what they were saying, but instead, labor is expensive now because labor is scarce, which is true. And that regulation is expensive, which it is, but also necessary. Perhaps the question is why wages are not high enough to support these prices (globalization, productivity wage gap over the last fifty years, etc). This will change over time due to structural demographics [1] making labor much more scarce (pushing up wages), we’re still in the early days. Software is not going to eat the trades and HVAC repair. [1] https://www.sas.upenn.edu/~jesusfv/Slides_London.pdf https://www.sas.upenn.edu/~jesusfv/Slides_London.pdf
- margalabargala 11mo ago
  I didn't see anything in their comment where they added "and therefore we ought return to rampant extreme poverty", did I miss it? They don't appear to be suggesting anything you say they are, just describing the effects of what exist. It can be true that consumer protection laws raise the price floor for certain goods and services without "and therefore consumer protection laws are bad".
  - locknitpicker 11mo ago
    > I didn't see anything in their comment where they added "and therefore we ought return to rampant extreme poverty", did I miss it? The US is already experiencing rampant extreme poverty. There are people in the US holding multiple jobs and still can't afford to eat, let alone healthcare. Again, this argument that things are expensive because the poor can't work and regulation somehow is suffocating businesses is purely ideological and not supported by facts.
myhf 11mo ago
it's not surprising that you've picked up some unsubstantiated protestant dogma disguised as economic theory, if you are hanging out on facebook neighborhood groups
locknitpicker 11mo ago
> (...) a multitude of government programs that seek to eliminate extreme poverty, (...) consumer protection policies that make it genuinely expensive (...) I don't think this opinion holds a rational basis. Extreme poverty being a factor in low job demand is an argument for coercing people into performing certain tasks even though they are not economically viable just because it benefits you personally. This is not a valid argument, neither indentured servitude or slavery. Isn't the US supposed to be a free market economy where free Enterprise reigned? Complaining about regulation, including waste disposal, is also dumbfounding. Being required to dispose of air filters in a landfill is not the reason why you can't afford a repair. This opinion is also comical as HVAC also covers air quality because otherwise you can be cool in a room but literally sick. This sort of opinion sounds completely irrational and unsubstantiated, and extremely ideological. The main factors driving repair cost are things like device longevity, unit price, speed and ease of repair, parts availability, etc. That's mainly it. When you call someone to your house to repair something, the price tag covers that person's cost of living for the fraction of the time it takes them to deal with your problems. On top of that, you need to pay whatever parts they need to buy to get your things back to work. That's where the money goes.
- XorNot 11mo ago
  I agree. Given that as soon as cloud computing happened we stopped bothering to debug VMs and just started deleting them and rebuilding, I don't know why people find the idea this applies to other industries surprising. Repair involves establishing where in a very large state space an item is, and finding a path back to optimal. Whereas building a new item simply involves traversing an already known path to optimal.
  - consp 11mo ago
    While in understand your reasoning it is a limited view perspective: The rebuild cost of a VM to society as a whole is marginal at best, an entire hvac system has a lot more crap it needs to dump somewhere when it is replaced.
- michaelt 11mo ago
Ekaros 11mo ago
Cost of living goes up. Cost of services if they are not done more efficiently must as well go up. In the end cost of labour in my theory comes down to cost of housing and cost of health care. Cost of food and most other things should follow cost of labour. When both are profit generations or being inflated. Well there is no other options than to cost of labour go up.

WarOnPrivacy 11mo ago

> First, we have a multitude of government programs that seek to eliminate extreme poverty, Clarification: In some places we absolutely do. In others we absolutely do not. > so there are fewer people who are desperate to take any job for any money. I think is is better reflective: There is huge surplus of employers have that set up systems that insure they do not hire qualified people. Job portals that auto-trash applications from unwanted applicants (1st time, most minimal of crim rec, wrong zip codes) are one massive example. source: me+kids spent a decade in red state, hunger-level poverty. kids who got zero replies during months/years of entry level job apps.

aeonfox 11mo ago

> eliminate extreme poverty, so there are fewer people who are desperate to take any job for any money One way to eliminate extreme poverty and increase skilled labour, is to ensure children have enough nutrition, health, schooling, and funds to pursue skilled worked in adult life, which usually involves making time outside of work, adequate health, some prerequisite education, and a sufficient financial buffer to actually upskill. A second thing is Baumol's Cost Disease. If there are other industries that are more rewarding that require less effort, no-one is going to pursue those options. Why be a clever guy who makes a product (or becomes a HVAC repairer, electrician, etc.) when you can get a comfy job at a FAANG (or whatever the acronym is today). You could sub in benefits here, but I don't think people are thriving on benefits in the US. But I'm an outsider, so I wouldn't know. But there's also a secret third thing that people don't often consider, which is the culture. If there's a culture that doesn't privilege working hard, or educational attainment, etc., people won't seek those things.

WarOnPrivacy 11mo ago

> Second, you have consumer protection policies that make it genuinely expensive to, say, be a HVAC repairman. clarification: Of the things that make it expensive to run an HVAC repair company, consumer protection related expenses are super far down the list. source: 2 decades (on/off) supporting a close friend's regional hvac biz, national geothermal interests.

ApolloFortyNine 11mo ago
A quick Google says it takes 4 years to get a license to be an HVAC technician in my state. I understand large installs at businesses are a different problem, and granted I've only ever installed a mini split, but that was hardly rocket science. And home installs are likely what most people are thinking of here. In Japan you can get minisplit's installed for $1k a unit, here you regularly find quotes over $10k. Something's gone wrong somewhere.
- locknitpicker 11mo ago
  > In Japan you can get minisplit's installed for $1k a unit, here you regularly find quotes over $10k. How much does the unit cost? What work does it take to install it? How large does it need to be to support your home? What are the energy needs of your typical home in Japan vs your home town? Those are the key factors, not how many years someone spends in tradeschool.
  - rcxdude 11mo ago
    The units themselves are not significantly more expensive nor any more difficult or time consuming to install.
  - deleted 11mo ago
    [deleted]
  - fragmede 11mo ago
    Why would those be dramatically different anywhere? It's the same few choices of mini-splits from the same few Japanese/whatever conglomerates across the world, with known cooling abilites (measured in the same units, BTUs) and with known energy consumption (kwh) (and power in watts). The hotter the place you live in, the more power it's gonna draw, and the more BTUs you'll need. Also the bigger the room, the more BTU you'll need. Fujitsu and Mitsubishi both have popular units that are basically the same the whole world over, with minor regional changes. There really isn't that much variation though. There are obvious differences, a mini-split in a hot part of the world is going to be working harder than a mini-split in a cooler part of the world. Humidity will differ as well. It's a large home appliance. You need a pair of strong people to drive over to the customer's house, bring it in their house, locate the right place to install it, unbox it, support it, wire/pipe it up correctly, and then give it power. The Big Mac index gives the difference in price between Japan in the US to be $5.79 vs $3.11 in JP (in 2025), and meanwhile $1k vs $10 is, well, 10x. There's something at work here, but it's not due to variations in the difficulty of unboxing a large metal thing, drilling holes, running some tubing and then powering it on.

landl0rd 11mo ago

Why do you think people insist someone needs to be licensed, bonded, and insured? It's not really a quality question, it's CYA, a direct response to the rise of ambulance-chasers and increasingly-ridiculous jury awards. Morgan and Morgan are probably doing as much economic damage here as Baumol.

XorNot 11mo ago
They insist on that because if someone does work on your property they might destroy your property Yeah it's CYA: the ass in question is yours. The guy who burns your house down without insurance will just file bankruptcy. You're the one left with the ashes.
- jmb99 11mo ago
  Would your homeowners insurance not cover that? Mine would.
  - XorNot 11mo ago
    You might want to really do a careful read of your policy, because almost all of them have provisions about requiring work to be completed by licensed tradespeople.
    - jmb99 11mo ago
      I've heard people say this before, so a few years back I got all of my friends and family to send me a full copy of their insurance policies. 0% had any lines saying anything regarding work being performed by licensed tradespeople, or even that work must be done to building/etc codes. This was across multiple insurance companies in 3 provinces (Canada), for policies on condos, semi-detached, and detached homes. I have my doubts that such a thing exists outside of extreme circumstances or internet commenters' imaginations.
      - XorNot 11mo ago

stein1946 11mo ago

> You can just as well argue that labor is getting more expensive in the West because of two non-market pressures. First, we have a multitude of government programs that seek to eliminate extreme poverty, so there are fewer people who are desperate to take any job for any money. Second, you have consumer protection policies that make it genuinely expensive to, say, be a HVAC repairman. Educational requirements, permits, licensing, business insurance, waste disposal, etc. How's what you wrote substantiated at all? To me it seems you are suggesting we let people starve so that labour you characterize as "minimally-skilled backyard" is cheap. You also seem to be suggesting that consumer protection policies need to go as well. I assume we are going to trust the end consumer to do due diligence cause "they know whats better for them?" If they get a quote of 10k and they cannot get a better one, they might as well start writing that check.

toomuchtodo 11mo ago
I don’t think that’s what they were saying, but instead, labor is expensive now because labor is scarce, which is true. And that regulation is expensive, which it is, but also necessary. Perhaps the question is why wages are not high enough to support these prices (globalization, productivity wage gap over the last fifty years, etc). This will change over time due to structural demographics [1] making labor much more scarce (pushing up wages), we’re still in the early days. Software is not going to eat the trades and HVAC repair. [1] https://www.sas.upenn.edu/~jesusfv/Slides_London.pdf https://www.sas.upenn.edu/~jesusfv/Slides_London.pdf
margalabargala 11mo ago
I didn't see anything in their comment where they added "and therefore we ought return to rampant extreme poverty", did I miss it? They don't appear to be suggesting anything you say they are, just describing the effects of what exist. It can be true that consumer protection laws raise the price floor for certain goods and services without "and therefore consumer protection laws are bad".
- locknitpicker 11mo ago
  > I didn't see anything in their comment where they added "and therefore we ought return to rampant extreme poverty", did I miss it? The US is already experiencing rampant extreme poverty. There are people in the US holding multiple jobs and still can't afford to eat, let alone healthcare. Again, this argument that things are expensive because the poor can't work and regulation somehow is suffocating businesses is purely ideological and not supported by facts.

myhf 11mo ago

it's not surprising that you've picked up some unsubstantiated protestant dogma disguised as economic theory, if you are hanging out on facebook neighborhood groups

locknitpicker 11mo ago

> (...) a multitude of government programs that seek to eliminate extreme poverty, (...) consumer protection policies that make it genuinely expensive (...) I don't think this opinion holds a rational basis. Extreme poverty being a factor in low job demand is an argument for coercing people into performing certain tasks even though they are not economically viable just because it benefits you personally. This is not a valid argument, neither indentured servitude or slavery. Isn't the US supposed to be a free market economy where free Enterprise reigned? Complaining about regulation, including waste disposal, is also dumbfounding. Being required to dispose of air filters in a landfill is not the reason why you can't afford a repair. This opinion is also comical as HVAC also covers air quality because otherwise you can be cool in a room but literally sick. This sort of opinion sounds completely irrational and unsubstantiated, and extremely ideological. The main factors driving repair cost are things like device longevity, unit price, speed and ease of repair, parts availability, etc. That's mainly it. When you call someone to your house to repair something, the price tag covers that person's cost of living for the fraction of the time it takes them to deal with your problems. On top of that, you need to pay whatever parts they need to buy to get your things back to work. That's where the money goes.

XorNot 11mo ago
I agree. Given that as soon as cloud computing happened we stopped bothering to debug VMs and just started deleting them and rebuilding, I don't know why people find the idea this applies to other industries surprising. Repair involves establishing where in a very large state space an item is, and finding a path back to optimal. Whereas building a new item simply involves traversing an already known path to optimal.
- consp 11mo ago
  While in understand your reasoning it is a limited view perspective: The rebuild cost of a VM to society as a whole is marginal at best, an entire hvac system has a lot more crap it needs to dump somewhere when it is replaced.
michaelt 11mo ago

Ekaros 11mo ago

Cost of living goes up. Cost of services if they are not done more efficiently must as well go up. In the end cost of labour in my theory comes down to cost of housing and cost of health care. Cost of food and most other things should follow cost of labour. When both are profit generations or being inflated. Well there is no other options than to cost of labour go up.