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We're talking about the profits generated by the business. The worker sells their labor. There's no reasonable way of valuing what their labor "costs" to them,
by dannypgh 13y ago
We're talking about the profits generated by the business.
The worker sells their labor. There's no reasonable way of valuing what their labor "costs" to them, as it's ultimately the opportunity cost of being able to do anything else, so it's not really sensible to talk about selling your time as "profit" or not.
You can approximate what it's worth to them by the market, in which case the only people who clearly can be said to profit from their labor are those who are being paid above market rate. I suggest to you, that's relatively rare (note if you're outsourcing out your work at market and then doing some sort of QA, the delta between market and what you're paid is probably around market for the QA, else the employer would have outsourced the work themselves).
The profit I'm referring to is revenue minus costs for the corporation. All wages and salaries here fall under operating costs. The profit goes to the corporation, which is owned by the shareholders, not the employees.
It's misleading to re-characterize wages as profits, because the wages are what's purchasing the labor which is used to create the revenue. If I charge someone $10 (assume that's market rate) for a car wash and in turn pay someone $10 to wash the car, I have paid $10 in wages, have $10 in revenue, and have no profit. The person who washed the car sold a service worth $10 for $10, so they have broken even. Note that if what I'm doing is finding customers, I am adding my labor as well, and can and should earn a wage for that. If I'm doing nothing but letting the business run itself, I am not selling any of my labor, but I am still legally entitled to the delta between revenue and costs.