Conversation

Aella
@Aella_Girl
One thing I don't fully understand is why the equilibrium for the demand/supply of labor is not enough to live on. Why does the hiring party get to be more picky (and thus pay less) among potential employees, while employees get to be much less picky in their job? Some theories:
31
46
Aella
@Aella_Girl
Maybe 'not enough to live on' is a false premise - maybe the natural equilibrium *is* enough to live on for a subsection of people, and artificially pushing the equilibrium upwards (minimum wage) somehow has spillover effects onto people who need higher pay (like a family)
4
8
Aella
@Aella_Girl
Maybe there's something weird specifically with *low* pay labor/demand markets. High paying jobs often do feature very strong employee power - lawyers can make private practices; head hunters try to poach employees, etc. Why is the equilibrium inadequate for low wage categories?
1
Retweet
7
Likes
Aella
@Aella_Girl
Replying to
@Aella_Girl
Maybe there's not enough 'natural' competition among companies at low wages? Just, not enough jobs in general offering entry level positions. If more jobs opened up, employees could put way more pressure on companies, and wages would naturally increase to be competitive.
2
6
Aella
@Aella_Girl
Basically, I'm operating under the assumption that the need for a minimum wage is abnormal. The idea that we have to literally ban the option for consenting adults to agree to certain types of exchanges means that something else is very wrong inside the system.
7
36
Aella
@Aella_Girl
My priors make me want to guess that regulations that make it difficult for new businesses to pop up, or tax burdens that make it difficult to hire more employees, and lobbying'd laws from corporations that suppress competition, are the real culprits for low equilibrium.
9
23
NFT profile picture
Nick Dobos
@NickADobos
Replying to
@Aella_Girl
I think this is the right answer. The market is flooded with low skill workers, so they turn into commodities. Why pay $100k to hire someone with skills that everyone has? So the wages race to the bottom because low skilled workers are competing with cheaper low skilled workers.
1
The CDC (Christine Diane Cherry)
@chriscereza
Replying to
@Aella_Girl
Low wage jobs tend to be unskilled and parts of larger teams. Hiring one employee vs. another likely won't affect an employer's productivity in a major way. A potential employee has nothing to bargain with. They're not bringing valuable skills or clients or anything another can't
1