General Question

AdventureElephants's avatar

Should the government be looking at incentives to maintain a labor demand?

Asked by AdventureElephants (1397points) December 24th, 2015 from iPhone

With McDonalds making a quiet but huge shift to machines versus living, breathing employees to curtail costs and avoid government mandated benefits and fines, is there a concern that we are screwing our lower class?

Forbes wrote an interesting article on labor demand, and on technology being a slippery slope to less educated or skilled people being able to find gainful employment. There is a company that has even mechanized the entire kitchen staff for fast food joints. According to the article, an average fast food burger place spends $135k annually on labor. It doesn’t specify if that also includes paying into the affordable care act, worker’s comp, etc., but it is a large number regardless. Of course it would be appealing to consider a one time purchase to switch to a machine instead of a laborer.

Should the government begin thinking about incentivizing companies for hiring employees, instead of always demanding more?

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31 Answers

RedDeerGuy1's avatar

No. They should promote and retrain people for better jobs. A human is more useful now then in the past. A higher wage should reflect that. I think high school should be mandatory as well as the first three years of college and university. Also they should be free. The first three years of post secondary should be the next higher school. They should change the adult age cap at 25 to vote and drink and to get free education .

AdventureElephants's avatar

@RedDeerGuy1 That sounds ideal. How do you propose those requirements that are free to the individual get funded?

RedDeerGuy1's avatar

@AdventureElephants Aprenticeships. Paid training/ work even for those taking university theory.

tinyfaery's avatar

What they should be doing is fining businesses which choose to operate oversees so they, too, can avoid taxes and labor costs, a HUGE tariff or tax for the amount of money they spend outside of this country but import into the country in which they are incorporated.

Fuck those Trump yahoos who think Mexicans are the problem. The problem is all of America’s jobs are outside of this country. Manufacturing and distribution can not only bring jobs, but it brings jobs to people who are being fazed out due to technology. This is the era of tech and it cannot be stopped.

AdventureElephants's avatar

@RedDeerGuy1 But you cannot force a company to hire anyone. So how will you convince companies currently cutting costs and labor demands (in part because of government mandates like Affordable Care Act) to take on additional paid (internships) employees because you want to mandate further education? And who will pay for the three additional years of education and materials you are suggesting?

I’m not saying it’s a bad idea… If you have a reasonable and cost effective solution that people are willing to get on board with. I already have a good job and education. I do not want to pay more taxes to give free education to the younger generation when I’m still paying off my own student debt.

RedDeerGuy1's avatar

Voulentary enrollment. Like aprenticeships are now.

AdventureElephants's avatar

@tinyfaery I agree that the Immigrant workforce isn’t the biggest issue at hand. It’s a scapegoat.

So you believe that negative reinforcement by way of fines would be more effective than positive reinforcement of hiring American employees for tax breaks or other incentive?

ibstubro's avatar

Catch 22. McDonald’s can’t pay a (hypothetical as it varies by region) $20 minimum wage as they are currently configured.

If they automate, they can combine 3–5 jobs into one. The one remaining job is now a skilled operator position, paying $30–40 an hour. Automate the store, increase wages, add a maintenance mechanic, and pay for the mechanization. The cost saving to the company is primarily in employee benefits.

It’s exactly what happened to American manufacturing. The more dangerous the job, the faster it’s automated because then you factor in the workman’s comp savings, too.

elbanditoroso's avatar

The government attempted to do this by putting more money in the economy, and by bailing out the car companies. And they were roundly criticized (even castigated) for that by the republican right, and specifically the Tea Party. Why? Because their ideology of small government far outweighed the social goals of keeping people employed.

So while it is desirable and beneficial for US society to have full employment, there are ideologies and groups that argue against it. Therefore, expecting government to have a works program (like FDR did after the Depression and before WW2) simply isn’t going to happen in this political climate.

Someone above made the comment that you can’t force an employer to hire a person unless they need that person to work. I agree with that. But the employer can’t / won’t do that unless they have the business to support that employee.

So it comes down to improving business (in general) which will make more employees desirable. And this is where you get some severe philosophical differences – the tax cut, trickle down economics crowd (on the right) and the government pays for everything crowd on the left.

Neither approach works completely. My personal choice is not to have people starving on the street.

Tropical_Willie's avatar

@tinyfaery If we were to move all production for all USA consumers back to USA, items would cost 50 % to 250% more. Could you afford gas at $5.50 per gallon, Levi bluejeans for $100.

Companies like GE and Boeing would go out of business if trade barriers were formed to block imports because the foreign countries would not allow USA technology to be imported into their countries.

I had an Economics professor in college that always said issues about trade “should be left to the invisible hand of the market process.”

tinyfaery's avatar

Capitalism is a ridiculous economic system. It only enriches the wealthy class and has lead to the oligarchy we currently live in. The greed of capitalism has destroyed democracy, the environment and humanity.

ibstubro's avatar

What it comes down to is that America is methodically mechanizing low paying, non-rewarding, and high-risk jobs.
If you demand McDonald’s pay 2x minimum wage plus benefits, the only way they can do that is to find a way for the employee of tomorrow to do the jobs of 3–4 employees of today. Then there’s an uproar because all the truly crappy, low paying jobs are disappearing.
McDonald’s has the resources to keep labor costs a (x) amount. The old business model is lots of low paying jobs. The new business model seems to be fewer, better paying jobs. It’s either/or.

Hypocrisy_Central's avatar

I don’t think it is government’s job to keep the employment of the ”wage slaves” from evaporating, if anything, the mentality in the US of I want it all and I want it now, I want it all and I don’t care how will jettison a lot of jobs overseas while saddling John Q in credit card debt to the tune of 10s of thousands. Government should be sponsoring programs to help people channel their ”inner immigrant” and use modern technology and media to be their own boss and create their own businesses.

jerv's avatar

How is this for incentive; when people are poor, demand declines and they can no longer sell a damn thing and wind up going out of business? Oh, and we’d need to tax businesses even heavier to pay for the social safety net unless you want us to be a humanitarian disaster of the sort that usually invites international military intervention.

So basically, any company that wishes for the US to remain anything other than a wasteland.

@Hypocrisy_Central If that ever came about, rest assured that you would find government paying out a lot more in low-income assistance and/or disability than we do now. The era of pulling yourself up by your bootstraps ended decades ago, and only those stuck so far in the past that they don’t even know that the 14th Amendment was ratified still cling to that delusion.

@ibstubro “New” by the standards of the 19th century perhaps. Or are you implying that there is absolutely positively no correlation whatsoever between wages and consumer demand? I mean, last I checked, when the majority of the population had more discretionary income, they bought more goods/services, which in turn required more supply, leading to job creation…. but only when one discards disproven rhetoric and looks at actual historical results.

Haleth's avatar

American workers have become increasingly productive while wages rose much more slowly. A large amount of corporate profits goes to companies buying back their own shares to keep the value of their stock artificially high. If companies used that money for growth and projects instead, they would probably perform better and more of the money would make it back into the economy.

We need a well-paid population because otherwise, who is going to buy all the stuff that keeps our economy going? Buybacks are basically ouroboros eating its own tail. But we’re in a situation where everyone is doing it, so everyone has to do it to be competitive.

ibstubro's avatar

With McDonalds making a quiet but huge shift to machines versus living, breathing employees to curtail costs and avoid government mandated benefits and fines, is there a concern that we are screwing our lower class?

“McDonald’s has the resources to keep labor costs a (x) amount. The[ir] old business model is lots of low paying jobs. The[ir] new business model seems to be fewer, better paying jobs. It’s either/or.”

You seem to be saying that the solution is to force McDonald’s keep the crappy jobs and force them to pay more than their value, @jerv.

I wasn’t addressing some nebulous ‘19th century standard’, but the OP’s question. I don’t see how that was confusing.

jerv's avatar

@ibstubro Paying more than their value… I’m trying no not laugh derisively at that one. Wage stagnation has made the vast majority of people underpaid for decades, and correcting something that has gone unchecked for so long will cause a lot more problems than we would’ve had otherwise.

If you feel it wrong to force businesses to raise wages to livable levels or to keep “crappy” jobs, then you are endorsing either massively expensive government spending in the form of a social safety net, or turning the US into Mexico (if we are lucky), with all of the prosperity and equality that implies. Are corporate profits more important to you than the United States? I cannot read your mind, but what I’ve read so far implies that you think they are, and I cannot abide by that. I also feel that those businesses who push their expenses onto taxpayers should be penalized.

Put another way, if businesses won’t do what needs to be done, then either government will step in or both business and government will get tossed out on their ass (assuming that their ass is not removed). That’s how empires roll once they pass the “decadence” phase, and we’re already in the early stages of the “exhaustion” phase. To my mind, your opinion is a throwback to nebulous 19th century (or earlier) standards; outdated thinking that flies in the face of precedent, and clings to notions from a bygone era that is no longer relevant unless you are actually aiming for a return of the days of serfdom. At best, it’s the sort of thinking that has started many an empire on the downwards spiral into the mists of history.

So do not mistake my dissent for confusion; I consider that insulting. Just accept that you and I disagree.

ibstubro's avatar

So, you believe there is no limit to the value of a burger flipper for McDonald’s, @jerv?

Business’s are doing what needs to be done. McDonald’s in automating so they will have fewer workers with higher wages and benefits.

It’s not just low wage workers that are being automated out of jobs as the technology becomes available. I have a friend of mind that was a career Walmart employee and a regional manager in California. All the regional managers were given golden parachutes and the job was consolidated into a state-wide position.

I worked in a food factory and the first jobs either automated or exported were the most hazardous. hand palletizing cases of finished product. Stuffing packets in boxes as they came down a line. Up the food chain these changes were made with union blessing. Less jobs overall, but improved worker health and pay. Progress.

jerv's avatar

@ibstubro I believe that human life has a value, and barring deviants like pedophiles and murderers, that value is no less than the cost of modest shelter, adequate food, basic medical care, and the means to better one’s self. If your idea of the value of a burger-flipper is lower than those standards set forth in the UDHR then I question whether you have enough empathy to not be a danger to society.

And what of the people who are displaced by those policies? Tell me, do you support larger, more expensive government and higher taxes, or do you consider a few million lives a small price to pay because non-workers are non-human? But I guess so long as the Waltons are raking in the dividends, a few million starving children is worth it. Oh, and Costco will implode any minute now because of their outrageous wages…. despite the fact that their stores are more profitable than Walmart, and their benefits are funded by company revenue rather than taxpayer dollars.

AdventureElephants's avatar

I just wonder what jobs will be available for less intelligent or less qualified individuals as we phase out their jobs in favor of machines or technology. How will they have an opportunity to make money or provide for themselves?

jerv's avatar

@AdventureElephants That is actually a legitimate concern, but a potentially avoidable problem. I say “potentially” simply due to being cynical about us actually being able to do what it takes over the objections of the regressives that infest our government.

Education is important, yet we prefer to make it a high-priced luxury then complain that we don’t have enough qualified applicants in the US while denying that it’s our own damn fault. And gawd forbid that we expand on programs like the vocational class I took in high school that started me on my career path.

Despite my trade being pretty technical, the truth is that most machinists are actually of only average intelligence with no formal education beyond high school. Of course, those who are bad at math won’t have a chance, but if I can take a half-stoned recent HS graduate and give him the skills to land a job that starts at $16–18/hr in under a year, then I think that the only ones who will really suffer are the technophobes, the Luddites and those educated in red states.

ibstubro's avatar

Blah, blah, blah, @jerv.

McDonald’s (the fast food model) was founded on the idea of lots of low-paying, entry level jobs. Employees could earn cash while focusing on a larger goal such as school or a full time job. There will never be a time when every job in the marketplace pays a living wage. There are people happy to work for less.

You seem to be focused on McDonald’s paying a living wage. Fine. Apparently they are too. They will automate, displace 50–75% of the workforce and pay a decent living wage. This will likely eliminate all the entry level jobs, as some proficiency in machine operation will be required.

Walmart is doing the same with self checkout. Fewer employees mean that the amount that is budgeted for labor is split less ways, raising wages while reducing employees.

You can legislate minimum wage, but you can’t legislate how business responds to that demand. Traditionally, it has meant the same amount of work being done by fewer employees.

I’m not talking about or with empathy of emotion. I’m discussing the OP in practical terms of the marketplace:
“With McDonalds making a quiet but huge shift to machines versus living, breathing employees to curtail costs and avoid government mandated benefits and fines, is there a concern that we are screwing our lower class?”

My answer is “Yes”. We’re fast eliminating relatively mindless, entry level jobs designed to introduce people to the workforce with minimal demands by demanding companies transform these jobs into “living wage” jobs.
That can be done.
It is being done.
Automation creates skilled labor/living wage jobs and eliminates entry level position.

jerv's avatar

@ibstubro I am too. When the marketplace is too impoverished to afford goods/services, demand drops to the point where suppliers go bankrupt. But that leaves me confused as to where you are really going with this, or if you even thought it out.

Are you saying that you support making higher education accessible to those who were not born to rich parents? That sounds enough like Socialism that you know that it would never fly here in the US. Hell, many states don’t even require basic literacy or the ability to count correct change to get a high school diploma. Coincidentally, those are mostly the same states filled with voters that complain about socialism. The correlation is too strong to ignore.

There is no other explanation that I can see that support your claims that this is a good thing that aren’t based on either flawed logic or disproven rhetoric. (Well, aside from a few that involve you being either ignorant or mentally ill, but I know that you are neither stupid nor crazy, so I dismissed them.) What I have seen is a lot of data being omitted in order to make those theories seem the opposite of what history has shown the outcomes to be, except in those cases where the outcome was bad enough to imply that doing the opposite would be preferable.

Or maybe, just maybe, what has traditionally been done has such detrimental long-term effects that it shouldn’t be done again. I mean, traditionally women couldn’t vote or work outside the home. “Traditional” is not always right. You wondered why I said you are clinging to 19th-century standards? That is why. If you disagree with those practices and merely mentioned them as a statement of fact, then I was mistaken and it’s business rather than you that hasn’t acknowledged that the rest of the industrialized world has moved on since the days before WWI.

In any event, I see it as short-sighted at best unless it’s accompanied by massive reforms that other parts of the world have done, but that Conservatives fight tooth and nail to prevent ever happening here in the US. Things like educating our youth so that they can get a job here instead of forcing employers to move their work overseas to where the average tenth-grade (or equivalent) is better educated than many Americans with a two-year degree.

ibstubro's avatar

You misunderstand, @ jerv.

” your claims that this is a good thing…”

I’m not making claims and I’m not saying the way the marketplace works is good or bad. I answered the OP:
“With McDonalds making a quiet but huge shift to machines versus living, breathing employees to curtail costs and avoid government mandated benefits and fines, is there a concern that we are screwing our lower class?”

“Yes. We are forcing the removal of entry-level jobs from the market place by mandating that every job pay a “living wage”.”
You can require every job to pay a ‘living wage’ by raising the minimum wage, but you cannot require industry to retain un-skilled and low-skilled entry level positions.

I don’t understand why you have to introduce your own talking points “Are you saying…” to make points unrelated to my answers or the OP.

Here, Try this. Respond to the OP, independent of everyone else. Reset.
Ready. Set. Go!

“With McDonalds making a quiet but huge shift to machines versus living, breathing employees to curtail costs and avoid government mandated benefits and fines, is there a concern that we are screwing our lower class?”

jerv's avatar

@ibstubro As do you, since I already did that. If my thought processes and/or communication style are hard for you to comprehend, then I’m not sure what to do except rephrase and hope you get it the second time around.

Should the government be looking at incentives to maintain a labor demand?

Just because business is doing something, in this case eliminating low-end jobs via automation, that doesn’t make it a good thing. Government’s role is to ensure the health of the nation and it’s citizens. If business opposes those goals, then government must oppose business, or at least regulate it. If business insists on doing something that is harmful to the nation and it’s citizens, then they should be penalized. Lack of penalty could be considered incentive. Therefore, yes.

Now, did you miss that before? Or are you hung up on the fact that I answered the ORIGINAL question rather than the related sub-question? Maybe you answered the wrong question. The fact that you consider my points irrelevant to your answers makes me question your ability to parse syntax, but I would rather not derail this discussion into one regarding miscommunication.

It seems that you are averse to discussing the issue in depth though. For instance, you wish to sweep the whole matter of the true cost of such policies under the rug. Yes, it will save employers on payroll and benefits due to lower head count, but how much is really saved? You not only refuse to address that, but actually declare it irrelevant and belittle me for answering the sub-question, ”[I]s there a concern that we are screwing our lower class?”

Now lets move on to details added by OP, and therefore probably good to address…. again, since you deemed my responses irrelevant when I answered them previously.

“I just wonder what jobs will be available for less intelligent or less qualified individuals as we phase out their jobs in favor of machines or technology.”

Likely none.

Whether that means that we need to improve our education system to reduce the number of unqualified candidates or just expend our welfare system to handle a huge number of unemployables is a debate which could stand on it’s own as a separate question, but for the sake of not pissing certain people off too much, I’ll just leave it at “Likely none”.

“How will they have an opportunity to make money or provide for themselves?”

Damn, it looks like “Likely none” didn’t cut it. Sorry certain people; it looks like we must address how to handle the displaced workers, even if that means that we have to school you on the true meaning of TANSTAAFL, and the implications and ripple effects of replacing many low-skill jobs with one high-skill job and a machine…. though I already tried doing that and got smacked down for “being irrelevant”.

Well, I already outlined the three most likely ways it could go, two of which probably won’t happen because one of our major political parties refuses to allow them to, and a third which precludes the possibility of the displaced workers earning money or providing for themselves.

As for your statement, “You can require every job to pay a ‘living wage’ by raising the minimum wage, but you cannot require industry to retain un-skilled and low-skilled entry level positions.”, you are mistaken; WE CAN! Industry is not more powerful than the US. If you think that industry can wipe their collective ass on the Constitution and replace our Commander-in-Chief with a CEO, then we can discuss that tangent elsewhere. The point remains that, if the government deems it in the best interest of the nation, they damn well can force industry. I’m not saying it’s a good idea (it isn’t), but since the reforms required to avoid doing so will never pass, then it’s probably the best option we have. If you want to know why, then I must hang my head in disbelief that you don’t find the answer so obvious that you don’t already know.

In any event, I believe I’ve answered the question and it’s sub-questions at least twice now. If you still don’t get it, or you feel any part of it’s irrelevant simply because you don’t want to discuss this beyond a simple yes/no, then that’s on you. I wouldn’t be on Fluther if I wasn’t up for answering questions, and when necessary going into a little detail to answer the follow-ups like the ones OP added in their most recent post in this thread. If you cannot accept that, that’s on you.

ibstubro's avatar

So, you think the government has the power to force businesses not to automate?
Tell that to the UAW.

jerv's avatar

I think that the government has the right to defend itself and it’s citizenry. More accurately, I think that businesses lack the right to be a danger to society or national security.

Remember how Detroit crashed after automakers left? Imagine that in all fifty states for an occupational field that is a far larger percentage of the workforce.

Hypocrisy_Central's avatar

^ More accurately, I think that businesses lack the right to be a danger to society or national security.
I guess, it is how you define ”danger”, and if that label can be applied to any business?

Remember how Detroit crashed after automakers left? Imagine that in all fifty states for an occupational field that is a far larger percentage of the workforce.
Business should be bailed out to keep people employed? How small of a business should be floated so the job pool stays relatively stocked?

jerv's avatar

@Hypocrisy_Central Well, any company that can afford to pay it’s executives millions but can’t meet operating expenses without taxpayers subsidizing them is a danger to the economy, and thus a threat to the well-being of the nation. And we already have regulations to keep businesses from doing harmful things; it’s a flawed system, but at least it’s something to restrain them from literally raping, looting and pillaging at leaisure. (Ideally business would police itself, but this isn’t an ideal world.)

As for the other, there’s the rub. “Bailout” is a little ambiguous because TANSTAAFL; we’ll pay one way or another. Whether the businesses pay directly by keeping headcount up on their own or indirectly by raising taxes that will actually only really hurt the small businesses that actually do most of the job creation, it’s going to suck for them. But if they don’t pay, then they will wind up paying more, so there is a bit of a Catch-22 there. One that could’ve been avoided if we had altered our trajectory before impact instead of after.

As for how small, I’d say that the larger businesses are actually the ones that should be worrying. The larger employers don’t create nearly as many jobs as the collective sum of smaller employers, they generally receive taxpayer money instead of paying taxes, and true free markets are more competitive than monopolistic.

Of course, that would also require stripping power from the people who have been wrong about the economy for the last few decades, but at the current rate, I think that the international community will declare them a terrorist organization and solve that problem for us pretty soon unless we have a second civil war that renders it all moot.

ibstubro's avatar

The automakers left Detroit because the UAW had a lock on jobs in the auto industry, and the auto industry was almost exclusively in Detroit.

The UAW was determined that there would be a steady increase in wages and benefits without any reduction in the workforce.

The auto industry re-located to areas outside the influence of the UAW and began wholesale automation while still providing the new areas with great paying jobs.

I actually had Detroit in mind when saying that automation may be necessary if fast food restaurants are to pay a living wage.

jerv's avatar

There’s a bit more to that story though. I’m looking at where they relocated, and of the ones that stayed in the US, there are a lot of people there that don’t even have the education required to begin to acquire the skills necessary for those jobs, and a lot of people who are qualified but just cannot get those jobs because of the limited number of openings. We won’t even get into the ones that outsourced instead. I am also looking at the history of automakers both here in the US and abroad where their costs are actually lower because many of the things that UAW wants are so that their workers can have what every citizen of certain other countries already has but we won’t because other nations are “too Socialist”.

But you’re okay with that because a few Suth’n folk got decent jobs. So okay with it that you don’t care about the cost that came at.

Fine. I have enough migraines without beating my head against the wall, so I’m just walking away from this thread.

Oh, and Happy New Years.

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