In the company I mentioned, when performance review time came and one employee had to be sacrificed to the unsatisfactory category, it was the guy in a carpool who didn’t stay for dinner.
And you may be producing shit. I’ve read a paper (not online, last I checked) that showed that after about 50 hours you start making so many mistakes that at 60 hours you are only as productive as if you worked only 40. Sometimes you find these when you come back after an almost decent night’s sleep, but maybe you don’t, and the mistakes go out.
When I was working 60 hours a week, no real work got done after dinner any way. A guy who worked for me, and who was very good, planned his honeymoon which was fine with me.
I’d list store managers as an exception. Even if you weren’t expected to work a lot of hours, you’ll probably do it because it’s hard to stay on top of what’s going on otherwise. You just can’t get a complete picture of what’s going on in your company working just 40 hours and then putting work out of your mind the rest of the time.
But given the importance of the job and the level of trust required, I’m often appalled at how little some are paid. IMO, $47K is the MINIMUM you should pay someone who runs your business and has keys to the store, access to the cash, supervises all the employees, as well as hires them, etc.
This will cause workers base pay to become lower. It is a third party stepping into a voluntary transaction where nobody is being coerced. Nothing new here, typical anti-market stuff.
You are appalled that an individual takes a job for a better deal from his employer than literally every other person on planet Earth has offered him?
If you believe that $47k is such a minimum, pay your employee that and stay out of other transactions in the economy.
Employers may opt to not hire a third full timer when he has two 60 hr/wk employees when a government has imposed certain mandates. If an employer is legally mandated to provide for health care expenses, the picture changes quite a bit.
How? Even adaher disagrees with you, here.
Adaher is mistaken here. He is usually good on basic economics. Since this is a slight twist to an old myth, maybe he is being thrown off.
The regulation is causing businesses to pay more for the same output. Workers receiving wages that are now above their marginal revenue product will have to be laid off or receive a pay cut in base salary or the firm fair poorly. Government edict cannot make a worker more productive.
Employers will just work around this by lowering base pay, that’s exactly what IBM did years ago after a lawsuit.
http://usatoday30.usatoday.com/tech/products/2008-01-23-1323587765_x.htm
http://hotair.com/headlines/archives/2016/05/20/obamas-overtime-rule-tried-at-ibm-and-it-didnt-work/
the analysis of these effects is not one of the under-graduate micro economics 101 as your phrase goes.
the impact of the government regulation of course does not make a result, however in observed effects, regulation can motivate changed approaches that induce innovation for more productivity, as the base line for collective action changes. Where without regulation an innovator facing the up front costs that may be important may defer for the fear of being undercut by the bad actors, a general change of the baseline if within a reasonable margin may have positive innovation effects.
the example cited in the 2008 period is one during of course a global economic crisis, so the elasticity of wages would have been maximal.
such an action during a tightening labor market is not likely to result in lower base wages. It is more likely to result in innovation for labor efficiency. as I understand this impacts the lower end of the managerial segment, I can guess there is not much opportunity for the direct labor replacement or the reduction, but there may be many opportunities for automitization or other technology assist that could reduce such actors time burden.
in any case, the simplistic reaction analysis by farnaby and pool is incomplete and not directly accurate for the economic analysis.
You and I both have worked at high tech firms in Silicon Valley. The idea of an exempt engineer working only 40 hours a week is… I don’t know… I can’t stop laughing long enough to think of what the word would be.
To be fair, you’d react the same to the idea of paying one less than $47k.
I think this is pretty much what the first law firm where I worked did to paralegals. We were expected to work at least an hour a day beyond the core 37.5-hour work schedule. And we were paid better than other comparable firms paid for comparable positions, so I didn’t mind. But then the DOL released a clarification of the applicability of exempt status to paralegals (generally, they should not be classified as exempt), and the firm’s employment lawyers basically told management that they needed to pay us for overtime.
You should have seen the ridiculous backpedaling by our managing partner at the staff meeting when he announced the change. Of course we knew it was all about money (and I knew I was about to quit anyway, for totally unrelated reasons). “Of course, we certainly consider you professionals,” he said, “but the Department of Labor doesn’t want us to!” And that our salaries had been set with the idea in mind that some overtime was expected, but now they wanted us to leave at 5 p.m. sharp. One co-worker raised her hand and asked for clarification, “So, if [major telecom client] calls me at 4:55, which is 2:55 in the afternoon for her, mind you, because they’re on the West Coast, I’m supposed to hang up on her after 5 minutes?”
We were certainly not making anything close to minimum wage, but same concept. I left shortly thereafter, so I’m not sure how it all played out, but I did my own billing and know that I billed somewhere between 6 and 8 times my salary every year (most of our cases were done on a flat fee basis, and I was pretty damn efficient). And I know that the managing partner lived in a huge house in a very expensive suburb, while I lived in a dive run-down one-bedroom with East Bloc maintenance, and he wasn’t even an equity partner in the firm at that time.
So generally speaking, my heart does not bleed for the poor owners of profitable businesses who are actually going to do a bit more revenue sharing and/or respect their employees’ free time.
Is anybody thinking about the shareholders here … do y’all have any idea how much is costs to wash and wax a Learjet these days … or do we want to live in a country where our rich are stuck having to fly crappy POS Cessna Citations?
If you increase a workers wage $1/hr, their landlord can increase the rent by $50/mo if the landlord isn’t greedy … or $150/mo if they are … [ka’ching].
Do you have a cite from an actual economist?
This “may” happen or this “might” happen is not convincing to me. Even if innovation in automation is instead the outcome of the law, smaller firms will be stifled because the economies of scale are not there for investment in such time-saving technologies. I wouldn’t be surprised if this was the actual reason for the regulation. Statists will stop at nothing to choke the competition of their party backers, and confused statisticians masquerading as economists will give them the cover they need.
I am an actual economist.
Since I have seen your threads on monetary policy, convincing you is not of very much interest as it impossible as you hold political, not economic views on these issues, as your politicizing 2nd sentence shows.
As it happens the actual economic analysis of these impacts is complex - it is not micro-economics 101.
Of course it is possible small firms will be negatively impacted, often they are unless exempted in regulations - unless there is a transversal service provision or some other unforeseen innovation (a software).
You have the a priori political analysis first.
The analysis is not complex. You have not made it more complex. The simple fact is firms will not prosper if they make it a policy to keep workers on at higher than their marginal revenue product. Just because you said other things might happen, which they could, does not change this basic fact.
Doesn’t matter because both the political and economic analysis shows that the reg will hurt small business for the benefit of large business and you haven’t been able to argue otherwise.
Ramira, since you accept that base wages would be lowered under the conditions in the study, do you believe that the government would forego the enforcement of this regulation under like conditions?
It certainly is, as the impact, as similar analyses for the minimum wage, have shown. The effect depends on the state of the labor demand and wage elasticiities.
The margin for a firm product is not a simple labor value, this is a marxist type error.
I do not have an interest in trying, as it would be sterile with you, and the parameters of this would need to be examined including that the impact for the definition on a small firm.
Your a priori political position is not very interesting and not economics.
I have noted that it is plausible under certain conditions. I have not read this paper you linked. That the sponsorship is from one of your weird north american institutes focused on the “austrian school” does not encourage me to think it is worth my time to do so.
My only note on this is that the impact of such regulation is not in a proper economic analysis the simplistic micro-economic 101 ideas you asserted as economic.
The effect depends on a lot of things, but it does not change the fact that the regulation will alter, by force, the behavior of one or both of the parties in the voluntary transaction, and therefore is a drag on prosperity.
I never said the “margin for a firm product is… a simple labor value”, so I made no such error. I think you are losing something in the translation since what I actually said would be uncontroversial to a real economist.
No shit.
.
So show me some real economics. All you have said is things are “complex”. Impressive stuff.
You didn’t actually respond to my question. I’ll rephrase. If it is “plausible” under certain conditions" that base pay for these workers would be cut, do you think the government will stop enforcing this regulation under these “certain conditions”?
Ok until you present a “complex” economic analysis that contradicts my “political a priori ideological simplistic north-American weird Austrian school improper” analysis I will just have to continue in my ignorance.
Charming conversation, bud.