Ignorance of Labor Economics

[brazil84]

@minlokwat

The unemployed locals said “no way in hell” knowing that job entails the droning tedium of a sweat shop but instead of a sweat shop, you’re in a crab house replete with its nasty ol’ fish funk.

I’m quite confident that I could find people willing to do this job for 90k a year plus overtime.

[Damuri_Ajashi]

@Hyperelastic

My claim doesn’t directly involve immigration restrictions, just a sudden decrease in the unskilled labor force for whatever reason. The linked thread in the OP talked about the poorest 20% of people in the US disappearing for some unspecified reason. Immigration was only the most obvious example.

News flash, most of the poorest 20% aren’t doing any work at all. So if they went away, there’d be no loss in productivity. The few that are working are generally doing jobs for which there is already a huge oversupply of labor. Would it be hard to fill those jobs? No, those are the easiest jobs to fill. It is hard to find a chief of staff for a medical center. Takes months, sometimes years, and you’ll probably have to hire a consultant to find someone. It is not hard to find ten, or a hundred, people to stock shelves at Wal-Mart.

Christ, when they wanted to outlaw slavery, what do you think the slaveholders said? We’ll never get the cotton picked! We can’t do it! Nobody will do it! Yeah, asshole, nobody will do it for * free*. That doesn’t mean nobody will do it. People then weren’t entitled to cheap cotton and people now aren’t entitled to cheap peaches.

There’s a misconception that direct labor costs are the primary driver of the price of produce, whereas in reality it makes little difference whether you pay the pickers $8 an hour or $16 an hour. An hour’s picking spreads that $8 or $16 over many, many bushels of fruit. Go to a pick-your-own farm - the prices are hardly different from those of picked fruit. Most of the cost is in the land, the seed, fertilizer and water, the shipping and the marketing. Before anyone gets all up in my business, I spent a summer picking berries and it ain’t that hard, all you had to do was show up, get on the truck and start filling baskets. Even the fattest, smokingest desk jockey could get used to it in a few days. I’d much rather pick berries than work on an assembly line, for the same pay. At least you’re outdoors.

Well, maybe I am a victim of agro industry propoganda but how much of the berry farmer’s expenses does labor costs represent? I looked for this statistic online and all I can find were anti-immigrant sites siting that doubling the current wage of tomato pickers would increase the price ofr tomatoes by no more than 6% over the shrot term that would equilibriate at about 2% over current prices and pro-immigrant websites that state that about half of the cost of producing strawberries would is labor.

[Damuri_Ajashi]

@Acsenray

Fine. But are you willing to give up crabs, strawberries, or whatever agricultural product completely under these conditions?

The fact is that producers of agricultural products have to be able to adjust their prices in line with their costs. And raising the price might result in lost sales, which means that it might just make more sense to ditch the crab business altogether. Are you prepared as a consumer for crabs to become luxury goods?

Perhaps they are already luxury items that we are able to enjoy by virtue of the illegal work force subsidy.

[Paranoid_Randroid]

@Hyperelastic

The few that are working are generally doing jobs for which there is already a huge oversupply of labor. Would it be hard to fill those jobs? No, those are the easiest jobs to fill.

<clippy>
You look like you’re arguing that significantly constricting the supply of labor will not have an appreciable affect on its cost, while at the same time bemoaning others’ paltry understanding of economic theory. Would you like help?

• Get help looking up the definition of irony
• Find a cheap principles of economics textbook
  _ Don’t show me this tip again
  </clippy>

[Hyperelastic]

@Damuri_Ajashi

Well, maybe I am a victim of agro industry propoganda but how much of the berry farmer’s expenses does labor costs represent? I looked for this statistic online and all I can find were anti-immigrant sites siting that doubling the current wage of tomato pickers would increase the price ofr tomatoes by no more than 6% over the shrot term that would equilibriate at about 2% over current prices and pro-immigrant websites that state that about half of the cost of producing strawberries would is labor.

Nobody will give you the real number because everyone’s got an agenda. But if you stop to think that it surely takes less than three minutes to pick a pound of strawberries, including breaks, you could raise a berry picker’s wage from $8 to $12 an hour and it would only increase the labor cost by $0.20 a pound.

[Hyperelastic]

@Paranoid_Randroid

<clippy>
You look like you’re arguing that significantly constricting the supply of labor will not have an appreciable affect on its cost, while at the same time bemoaning others’ paltry understanding of economic theory. Would you like help?

• Get help looking up the definition of irony
• Find a cheap principles of economics textbook
  _ Don’t show me this tip again
  </clippy>

You were right before you inserted the word “appreciable”.

It all comes down to the price elasticity of the supply of labor, which for unskilled jobs is huge and always will be. But thanks for playing.

[Paranoid_Randroid]

@Hyperelastic

But if you stop to think that it surely takes less than three minutes to pick a pound of strawberries, including breaks, you could raise a berry picker’s wage from $8 to $12 an hour and it would only increase the labor cost by $0.20 a pound.

First: Where do you get the idea that it takes only “less than three minutes” to pick a pound of strawberries, “including breaks”? That sounds (er) quite on the quick side.

Second: Surely you’re aware that very small changes in input costs can — in principle — have very large effects on the price of the good produced? Increasing the marginal labor cost of a pound of strawberries by twenty cents completely changes the optimization problem.

[Paranoid_Randroid]

@Hyperelastic

You were right before you inserted the word “appreciable”.

It all comes down to the price elasticity of the supply of labor, which for unskilled jobs is huge and always will be. But thanks for playing.

How huge and for what groups? From my reading of your OP, you seem to be under the impression that there being a “surplus” of individuals who can do menial labor necessarily means anything. That doesn’t matter; it isn’t plausible that scooping out the most elastic workers, those with the lowest reservation wages, will not appreciably affect the price of labor. The very suggestion beggars belief.

Do you have numbers one way or the other? Labor supply elasticity estimates for undocumented blue-collar workers?

[curlcoat]

@Damuri_Ajashi

A lot of these jobs would dry up.

For example American fruit growers compete with South American fruit growers in the supermarkets. If we got rid of the illegal aliens in the fruit picking work force, the cost of labor would increase significantly and the price of Domestic fruit would increase and a lot of the fruit production would move to South America.

That’s a bad thing? Obviously those who have fruit orchards wouldn’t like it but if the choices are to continue to exploit illegals or lose some of our fruit production to other countries, which is the better choice?

Maybe we should go back to allowing kids to work the fields.

Its a classic case against the minimum wage.

For or against having one?

[Crafter_Man]

Here’s an experiment to try:

1. Talk to an unemployed friend who claims to want a job.
2. Offer them a job.

I’ve done this many times for work around my property. Each time I was given excuses why they can’t do the work. They always claimed “health problems,” or that the job “doesn’t pay enough.” And then they go back to playing video games and updating their FB profile on an hourly basis.

[brazil84]

@Crafter_Man

Here’s an experiment to try:

1. Talk to an unemployed friend who claims to want a job.
2. Offer them a job.

I’ve done this many times for work around my property. Each time I was given excuses why they can’t do the work. They always claimed “health problems,” or that the job “doesn’t pay enough.”

Well how much money were you offering?

[Drunky_Smurf]

@Acsenray

Fine. But are you willing to give up crabs, strawberries, or whatever agricultural product completely under these conditions?

The fact is that producers of agricultural products have to be able to adjust their prices in line with their costs. And raising the price might result in lost sales, which means that it might just make more sense to ditch the crab business altogether. Are you prepared as a consumer for crabs to become luxury goods?

According to this logic we have to exploit the illegals or else all food production stops because all of the producers of agricultural products decide to go out of business. Also according to this logic for farmers to stay in business they will have to charge more and not just $.50 or $1 more but so much more that enough consumers will throw up their hands and say, “Fuck, I ain’t paying that much for strawberries.” and then since the farmer can not sell his berries he goes out of business and then no more strawberries in America unless we import them which is going to cost more anyways.

Hmmm. Maybe you have a point there. Now, I’m with you guys who want this exploitation and semi-slave labor.

[Acsenray]

@Drunky_Smurf

According to this logic we have to exploit the illegals or else all food production stops because all of the producers of agricultural products decide to go out of business

My point is, actually, that “labor economics” doesn’t support any particular policy decision exclusively.

[gonzomax]

@Hyperelastic

You were right before you inserted the word “appreciable”.

It all comes down to the price elasticity of the supply of labor, which for unskilled jobs is huge and always will be. But thanks for playing.

I suppose you did not factor in the American ego. A person with a low paying job is a lesser person and would do well to listen to my criticism of his life. That is so American. i will judge your life choices from afar. I can make you so much better.
Lots of people are not too bright and can not qualify for higher education or better positions. They fight for low paying jobs. when a new McDonalds starts hiring ,people line up around the block hoping for a job. When a Detroit casino started hiring, the police had to keep peace and prevent rioting.

[Crafter_Man]

@brazil84

Well how much money were you offering?

$10-12 / hour cash.

[Hero_From_Sector_7G]

@Hyperelastic

Not sure of the relevance, but I might pay up to $5 a pound for good strawberries. However, I do not believe I *deserve *strawberries at any particular price, the way some people do.

I apologize, I didn’t mean to be deliberately obtuse.

I used strawberries as an example because in California they are a crop that is widely known to be harvested cheap because illegal immigrants do the labor.
My thinking was that what people are willing to pay for a product has a direct impact on supply. For example, if people are only willing to pay $5/pound for strawberries, and the cost of a pound of strawberries exceeds that price, then strawberries aren’t a viable market at that scale. The cost of labor factors into how much strawberries cost.

I just wanted to clarify myself. I admit I don’t have extensive economic training, so I’ll bow out of this thread.

[brazil84]

@Crafter_Man

$10-12 / hour cash.

And how many hours/days/weeks do you offer?

[Algher]

@Hero_From_Sector_7G

I apologize, I didn’t mean to be deliberately obtuse.

I used strawberries as an example because in California they are a crop that is widely known to be harvested cheap because illegal immigrants do the labor.
My thinking was that what people are willing to pay for a product has a direct impact on supply. For example, if people are only willing to pay $5/pound for strawberries, and the cost of a pound of strawberries exceeds that price, then strawberries aren’t a viable market at that scale. The cost of labor factors into how much strawberries cost.

I just wanted to clarify myself. I admit I don’t have extensive economic training, so I’ll bow out of this thread.

Strawberries are a great example, though. They are labor intensive, can’t be machine picked, and according to an old (dammit - since when did 1995 get old?) article from the Atlantic:

labor costs constitute 50 to 70 percent of the total costs in strawberry production

In the Strawberry Fields

[Hyperelastic]

@Paranoid_Randroid

First: Where do you get the idea that it takes only “less than three minutes” to pick a pound of strawberries, “including breaks”? That sounds (er) quite on the quick side.

Second: Surely you’re aware that very small changes in input costs can — in principle — have very large effects on the price of the good produced? Increasing the marginal labor cost of a pound of strawberries by twenty cents completely changes the optimization problem.

A pound of strawberries is about 20 berries, so that’s about one berry every 9 seconds on average. I am not a labor agronomist, just a guy who picked berries one summer, and it sounds reasonable to me. When you really get going, it’s pick, pick, pick. You’d have plenty of time for water and pee breaks.

Also, when I picked we got paid by the peck, not the hour, so the fruit farm didn’t really care how fast you picked. I vividly remember one guy who said he was trying to make a truck payment, and boy did he pick. I want to say it was 13 cents a peck for blueberries, but that sounds really low.

I’m not sure how a small change in the labor cost can result in a large change in the total cost. I guess it could happen but it doesn’t seem the norm.

Anyway, even if strawberries did go up to $10 a pound, that doesn’t affect my argument that unskilled jobs are easy to fill. If the job goes away because the product is too expensive, then there is no longer a job to fill. I’m not saying that’s good, but again it doesn’t impinge on my argument.

[Hyperelastic]

@Hero_From_Sector_7G

I apologize, I didn’t mean to be deliberately obtuse.

That’s OK - since this is the Pit you could have called me a fat fucking toolbag and I believe it would be permissible. Although they tightened up the rules on that a few years ago.