View Single Post
  #81  
Old 07-25-2019, 03:19 PM
slash2k is offline
Guest
 
Join Date: Feb 2014
Posts: 2,430
Quote:
Originally Posted by Scylla View Post
I’m not sure I understand. I am thinking about those supply/demand charts from Econ 101. People own their own labor and can sell it as they see fit. If it was not a living wage, wouldn’t they go elsewhere, thus limiting supply and driving up price?
Where is this "elsewhere"?

1. A lot of people are geographically locked, for a variety of reasons: spouse's job, familial obligations, etc. While some regions have lots of jobs, if you are constrained to jobs in small-town Nebraska or the hollers of eastern Kentucky, you are on the wrong side of the supply/demand curve and have no leverage.

2. Job concentration is a thing. For example, the single largest private-sector employer in nineteen states is the same company (Wal-Mart); they have enormous power over wages in the retail sector. While most businesses in the US are classified as small, most people work for large firms: half of the private-sector workforce is employed by just 0.4 percent of businesses (cite). You can't go elsewhere if the "elsewhere" is the same company.

3. Particularly in the unskilled to semi-skilled parts of the economy, automation and outsourcing means employers don't need as many hands. If workers demand too much more money, there's a decent chance they can be replaced by somebody in Mumbai or Manila (or by a robot).