And then what do they do? Stop accepting it? How, exactly?
The problem is that if you restrict the maximum number of hours worked per week this would harm the economy and probably increase unemployment in the short run.
Say your plant produces 100 widgets a month when everybody works 40 hours a week. However widget demand is not constant. Some months you can sell 120 and some months only 80. Being able to have workers work overtime and produce the 120 widgets is good for the company and helps make up for the 80 widget months. If the company can not have people working overtime it will not hire more people for that month because it will not need them during the average and below average months. It will probably just produce 100 widgets and the economy will just be short 100 widgets and the workers will be short the overtime pay and the company will be short the profit on the extra 20 widgets.
They complain about it and vote in people who say they will do somthing about it.
It is not clear to me why increasing the supply of money in this case wouldn’t simply increase prices in this case, consistant with the quality theory of money. Granted the quantity theory of money has some holes, but I don’t see dismissing it as quickly as you have done here.
It is interesting to note that economists do routinely measure inequality in close to the same way as SentientMeat describes. I’d say these measures–Gini Coeffients and Lorenz Curves–are anything but meaningless.
Again, I don’t see this. Unemployment as is usually measured means people actively searching for work. Your comment seems to imply there are people actively searching for work, but yet who must be forced to actually work.
I’m curious as to the origin of the 1%/40% figure. I’m not sure exactly what is being measured (what counts as wealth, for instance). It doesn’t seem to far off to be true, however.
How do you think? They will make a stink about it until elected officals are forced to do something about it. The will stop buying products and services because they are unable or unwilling to pay the high prices, which in turn will affect businesses.
And why isn’t it better for a few million people to be temporarily out of work instead of 280 million people living in poverty and having their savings erode to worthlessness due to inflation?
You want to address the unemployment problem? How about doing something about companies ability to terminate employment on a whim? What has changed over the past 30 years where back then if you lost your job, it was because you did something to deserve it while today, it’s usually because they want to save a few $ this quarter.
30 years ago the unemployment rate was about what it is now.
It is much harder to fire people in France than the US. I really think that if low unemployment is our goal France is not the model to emulate.
Actually, the guy at Micky-D’s, unless he’s a “manager,” will get paid for overtime if he actually works any (although McDonald’s is well-known for shady labor practices, e.g., not counting time spent idle–due to a low number of customers–as “on the clock” time, and other such utter bull).
I think the people who are most abused by the current system are white-collar professionals, middle-managers, etc… I once had a boss who made the team of programmers I was on work 12-hour days (plus half-shifts on Saturday) for over a month without a single cent of compensation for it. Stuff like that is not uncommon in my experience.
Great. He loves his job. Many of us don’t, and we’d rather put in 40 hours and use the rest of our time to enjoy our short lives on Earth rather then volunteering it to pay for our bosses bosses bosses bosses boss’s new yacht. I consider “workaholism” as bad an illness as alcoholism. Maybe worse.
To everyone.
I keep hearing France mentioned, and I’m curious: Is being unemployed in France has bad as it is in the US (e.g., eventual homelessness or having to sponge off relatives) or are there stronger social programs in place?
You can never have ‘zero’ unemployment. Not even the ‘zero long-term unemployment of the willing’ mentioned above. In a dynamic economy, jobs are constantly created and lost. Non-competitive companies die, and competitive ones grow. Consumption patterns change, which causes entire industries to rise and fall.
When people lose jobs, sometimes they don’t find new jobs in the same area. So workers migrate. Or they can’t find jobs in the same field, and they need to be retrained. Or maybe there ARE jobs in their field, but the whole process of looking for new work, interviewing, examining offers, etc. takes time.
Therefore, unemployment around 4-5% is considered to be ‘full’ employment. That’s about the best a healthy, dynamic economy can do. Today, it’s 6% in the U.S. This is a much lower unemployment rate than almost any other developed nation. Canada is hovering around 8% right now. The average for the EU nations is around 10%. Some EU nations are up in the 11-12% range. So, let’s keep it in perspective.
As for the specific remedy - bad idea. Let me give you just one small example of how such a law can distort industry - if a company can pay their employees to work overtime when necessary, they can run a ‘leaner’ operation. Fewer overall employees, smaller in-stock inventory, etc. If you can ramp up production quickly when inventory gets too low, you can keep less inventory on hand. This frees up capital and lower the cost of manufacturing.
Take away overtime, and a company no longer has the luxury of tailoring their labor force to immediate needs. It can’t hire more workers, because during slow times when lower production is acceptable it is over-staffed. So the end result will be a less efficient enterprise, lower profits, and therefore lower wages for people in that industry.
Multiply this across the economy, and you’ll have reduced GDP growth, a less flexible economy, and ultimately higher unemployment.
There are no magic tricks you can pull to make sure everyone makes a good wage and has a good job. All you can do is set up the conditions to allow for maximum freedom and efficiency, and let productivity gains raise the standard of living for all.
Look at the countries in Europe. Look at France and Germany, which have taken the ‘legislate your way to wealth’ tactic for some time now. Double-digit unemployment, economic stagnation, deficits so big they violate EU rules, and a deteriorating social fabric. These countries are not enlightened - they are throwbacks to an earlier time when we thought government had all the answers. Now we know better.
You need to think of an ecomony like a complex ecosystem. And I don’t mean in analogy, I mean exactly like an ecosystem.
No one understands how the entire ecosystem works. It’s just too complicated. The ecosystem has evolved over time to be pretty much in balance. Predator/prey, parasite/host, etc, etc, etc. There is no way that you, no matter how smart you are, can reliably “improve” the ecosystem. If you fiddle with it in any significan way, it’s almost certain that you will ruin it.
The economy is just like that. Fiddle with one thing, and the repurcusions reverberate thru the whole system. The economy is hundreds of millions of people each making thousands of decision every day. If you want the economy to flourish, the best thing you can do is leave the damn thing alone. Just like any complec ecosystem in nature.
I don’t get it either. I would prefer to be married to someone who isn’t a workaholic.
So if this law applies to everyone, it also applies to workaholics who love their jobs. How are you going to get them to stop working long hours? It’s not like he gets more money for all these extra hours. So why should you stop him from doing what he loves to do on a ‘volunteer’ basis?
This business about not liking to work for “unpaid overtime” is just silly. You take a salaried job because for any, some, or all of these reasons:
- You expect it provides more job satisfaction
- You expect it provides better opportunity for advancement
- You are also given bonuses or profit sharing or stock options
- Your mother wanted you to have a “nice office job with a salary”
If not, then petition to get demoted to an hourly worker and collect overtime. I’ve known many very competent hourly workers who got promoted to exempt and hated it. Some went back to being paid hourly, some learened to live with the misery.
One thing you have to keep in mind, is that current immigration policy is let in 57,000 more legal immigrants each week. Yeah, some of them are children, but over time, it still adds up to requiring that we need to add 57,000 new jobs to our economy each week, just to maintain the current unemployment level.
How many illegals come here each week adds to the number. Some estimates put it at least 43,000 illegals come here each week, which adds up to requiring that our economy must add 100,000 new jobs each week just to tread water.
The latest job creation report from our government, falls far short of 100,000 per week, thus, the situation keeps getting worse.
If you want to solve the unemployment problem in a long term way in the United States, then you must find a way to create MORE than 100,000 new jobs per week.
What bothers me most about the government reported unemployment rate, is that in my entire life, I have never ever met one single person who was surveyed by our government as to his employment status.
I have known, or been asked myself, about tv shows, surveys, topics, poitical candidates, nearly everything, but never about unemployment.
I wonder how many people on this board have been contacted by the official Bureau of Labor in their regular monthly survey used to publish our unemployment statitistics?
Anybody?
I agree that zero unemployment is not feasible, nor a good idea. I don’t, however, think that the effects of a “no overtime” law would be as bad as you suggest. In my industry (computer hardware) the norm is to work the employees hard. Hard enough that it is hard to get us to work significantly more, so contractors are used to smooth out the bumps in the design cycle.
In general, businesses are pretty resilient, in the long term they will learn to cope with the new law and probably end up pretty close to the same place as they would have without it. The ones who can adjust fastest to the new order will survive, those that don’t adapt well won’t.
In your particular example I think companies will start using temps and/or contractors more. To make this more efficient practices across different industries will need to standarize more.
Bigger deficits than the US?
Deteriorating social fabric, hadn’t heard that before. Is it worse than the perceived deterioration in the US?
I’ll try to dig up a cite when I get home, but aren’t people in Europe considerred better off wrt health care, education, general happiness than people in the US?
-chookie
You have a point that salaried jobs do have more benefits (e.g., more pay and benefits) then hourly jobs, but I take issue with the implication that all people who became exempt hated it.
I don’t know what your background is, but I’ve held two real jobs: doing construction-type work in telephone central offices during the summer when I was in college, and working as a computer programmer afterwards. The former was hourly, the latter was salaried. I’ve been in programming positions that were much worse then the construction work, and I’ve been in positions that were about the same.
To me, the issue with the current system is the enormous potential for abuse: I’ve seen “management” employees on H1-B’s working slave hours to keep their jobs (and country of residence!), I’ve seen people whose families have been ruined by obscene mandatory schedules (we’re talking 18-hour days here), etc.
I realize that the OP’s suggestion of 40-hour work weeks is hopelessly naive, but would you at least agree that the current system could use some stronger protections for workers? Or are you the economic-libertarian type who advocates letting the market sort it out? At least in my field (“information technology,” to use a broad brush), it’s not easy to be an exempt employee given the fairly nebulous definitions in most of the laws I’ve seen (although admiteddly I’m only familiar with the California and Federal laws).
Met: I was unclear. I have known many hourly workers who hated the promotion. I also know many that were fine with it. I didn’t mean to implay that all of them hated it. In fact, I’d say it was a small minority who did.
This seems very xenophobic to me, Susanann.
I’m no economist, but consider the following:
[ul]
[li]As you said, not all of the immigrants will be entering the workforce.[/li][li]You don’t take account attrition, death, deportation, etc. when you conclude that the number of jobs that must be “created” is equal to the number of immigrants[/li][li]A slightly more nebolous argument could be made that the illegal jobs the illegal immigrants are working in might not exist (or at the least, fewer would exist) if they couldn’t be filled by immigrants in the first place.[/li][/ul]
Yeah, I’m worried about unemployment and think myself and my fellow white-collar professionals get the raw end of the stick. But I can’t get worked up by someone risking his life to enter the country from Mexico so he can work 10-hour shifts cleaning Wal*Mart’s so he can send a small fortune (relatively speaking) to his family (or, if he wants to keep it and live in the US, that’s cool with me too). Yeah, maybe he is costing US resident’s jobs–maybe even mine–but my cursed liberal bleeding heart doesn’t mind. 
2004 Deficit Estimates
French Deficit/GDP:~3.6%
German Deficit/GDP:~3.8%
US Deficit/GDP:~5%
Of course, who would want to talk about that cultural wasteland that is France and Germany, what with their “deteriorating social fabric” and all. :rolleyes:
I am astonished that people would consider the 40 hour maximum work week (time and a half for overtime) somehow unfeasible. It has been on the books in the US for some time now. The question is whether it should be expanded and loopholes in it closed. The suggestion that the world will end with a 40 hour work week seems to be to be bizzare.
On an aside, why do the most ardent free trade advocates never say anything about free movement of labor? It would seem open borders is the market solution…
It’s been shown time and again that immigration creates about as many jobs as it takes up. If they really are taking jobs, then they are buying goods and expanding the economy as a whole (making the pie higher, as GWB said).
Not to mention that many industries, such as the Californian fruit industry, depend on the cheap labour of desperate immigrants to remain competitive.
And finally, the jobs situation in the US is currently getting better, not worse. How does that sit with your theory?