Wednesday, March 11, 2009

The great 4.5 day week.

In my mind employees are people who sell their time to employers. If what the employer produces with that time becomes worth less for whatever reason ( by the end user being unable or unwilling to pay), then it follows that the employee's time is also worth less.

But workers seem to think they have a God given right to never expect their time to be worth less. In fact they expect everyone else to step in and make up any shortfall by way of "training".

Maybe the taxpayer could step in and make up the shortfall if I fail to sell my products at the "full price". I could invoice them every week to cover the shortfall in my sales.

I know people will say "it's only temporary", but in governmentspeak "temporary" means "permanently temporary". Once something is given it soon becomes a "right". Especially if the unions think that Friday afternoon golf and fishing paid for by the taxpayer is a right. (I know that for now it is for "training",but once established, training will morph into fishing). Update; it isn't even out of the blocks and the training is gone.

It will then just be the simple matter of getting it from minimum wage to full wage. This will be a vote winning "policy" platform from Little Labour in some future election. You see how s*** like this soon becomes ensconced and manipulated.

Maybe the government should just stand on the sideline watching a free market game, rather than trying to be the star player, referee and supporter.

Or maybe I should just buy shares in a golf course.

19 comments:

Anonymous said...

In my mind employers are people who give their own money to other people

How hard is that to understand? Yet most of the country seems not to understand this simple fact.

Most of the people in this country get to eat because either a) their food is paid for by my damn taxes or b) their food is paid for by their employer's money

It really really really is that simple. And anyone who disputes it should be fired or/and all their benefits chopped in perpetuity - for disrespect.

FAIRFACTS MEDIA said...

I was a bit concerned at an element of compulsion in the 9 day fortnight that was mentioned on newztalk ZB yesterday.

That aside, I see John Key has one more support for his Wall Street Journal comments from Australia.

John Howard has expressed similar sentiments to Britain's Daily Telegraph and an Australian economics professor says Australia should follow Key not Obama.

There's more detail over at Barnsley Bill.

Lou Taylor said...

Hi FFM
I'm still eagarly awaiting your new blog. How is the colour scheme coming along.

Psycho Milt said...

Sinner - if employers are "giving" money to their employees, the simple answer is to stop doing it. Employees are much more use if you pay them for services provided.

FAIRFACTS MEDIA said...

Well, I found a really exciting template that has special sections for videos, etc, so the blog would stand out from the crowd.
But it is taking Barnsley Bill a little longer than expected to do the technical bits and bobs.
And these technical bits and bobs are harder to do than had I just taken a standard blogger template.
In the meantime , please encourage people to pop over to Barnsley Bill for my latest postings.
I would hate to think I am barking alone.
But BB does have strong UK traffic , which emphasises a continued strong coverage of global issues.

BTW Do you think we should have a bloggers drinks in the near future?
I am planning to come to Auckland for several days over the weekend.
And it is the ACT conference.
Are you going?
I'm thinking about it.

Clunking Fist said...

Thankfully "it's all too hard" to make it work for small employers, so they can stay away from the lunacy.

Anonymous said...

“In my mind employers are people who give their own money to other people”


No wonder your illiterate scrawls make no sense at all if you don’t understand basic economics, or financial systems…

Employers are people who pay other people [employees] to produce goods and services. They pay them with money that other people [consumers/employer] have paid them [read the business] with to provide the goods and services that the business is employing employees to create.

A: It is never “their” money as the money flows through a business account.

B: Their money is the profit creamed from the top.

David Baigent said...

Anonymous @ 1:20pm.

A "leftie" would say "the profit creamed from the top."

A "rightie" would say "the residual money that is left after raw materials, wages and tax, and AFTER it is sold and paid for."

Anonymous said...

B: Their money is the profit creamed from the top.


It's all "their money" - that's the point.
Some of it goes towards buying useful capital, like machines. Some of it on useless depreciatable junk, like computers. Some of it on worthwhile fringe benefits like jets, champagne, and fast cars (which unfortunately is taxed). And yes, some of it has to been given to employees.

Psycho Milt said...

Somewhere there's some men in white coats carrying a straitjacket and a big syringe full of thorazine, looking for a runaway fascist loony...

Anonymous said...

.. called Psycho Milf

DenMT said...

In a competitive labour market, you are exactly right - an employer buys the time of his/her employee. However, I take issue with the contention that if the employer starts to pull in less cash, then the value of the service of the employee is concomitantly less.

Take architecture for example. I have two friends here in Gothenburg who work for smaller practices that are really suffering under the financial crisis. Both have been offered reduced hours as a result - rather than a reduced wage for the same work. This is because the practices they work for have not reduced their chargeout rates, they are simply getting less work through the door. The value added to the firm by the employees has not in any way diminished, it is simply not able to be used by the practice directors.

I am not suggesting that the government step in in 100% of situations where employers are offering part-time contracts as a solution to hard times, but the contention that if the boss is making less, the employees value diminishes is plain wrong.

DenMT

Lou Taylor said...

You could be right DenMT but this century all businesses will have to closely question their model. What worked last century may not work now.
Architecture is a good example because people may now not want to use them. Many houses are "off the plan" now as people's ability to afford a custom designed house diminishes. So should theier charge out rate stay high. I'm not bagging architects as I love what they can do, but like every other business they need to look at their overheads. And wage costs would be a high percentage of their costs.

Lou Taylor said...

FFM, Would like to go to the ACT conference but may be busy.Will be around next week but then away tramping.

DenMT said...

Lou - from my own observation, there has been no move in the industry here to drop chargeout rates. Certainly a lot of work is going into stasis right now, mainly the more risky large residential high-rise projects. Houses are fairly safe ironically - clients who can afford architects can generally afford them in rough times, and are taking advantage of record low construction and material costs. It is more the spec end of the market where people are building to onsell that the real collapse is happening. This is just a local perspective.

Certainly if one savvy and influential office decided to drop their rates to win new work it might start somewhat of a trend, but there isn't a hell of a lot of tender work going around, so firms are sticking with established clients.

The following issue then comes in to play - if the director of a firm decides to drop his profits in a bid to win more work, does he then have the right to reduce wages as a result? I think not.

As a final comment, the employment marketplace still exists. An employee leaving a firm is in a tougher spot than two years ago, but it is not the barren wasteland some would have you think. It is extremely disconcerting to think (and not that I reckon this is what you are suggesting) that employers could attempt to leverage wage decreases against diminished alternative employment opportunities.

Bottom line - if an employee enters willingly into a negotiated pay decrease, I have no issue with that. But the fairer situation is one that recognises that an economic downturn does not diminish the inherent value of the employee - thus the ideal situation for everyone is a part-time type solution.

DenMT

Lou Taylor said...

As you say the crux of the matter is that any negotiations of pay rates in non unionised business should just be a matter of commonsense. I am sure architects are more than capable of negotiating a win win situation, whether it be up in good times or down in bad. The historical value of employees has been build up over 50 years of growth. When you take that growth out of the equation for whatever time this crisis lasts then values may have to come down. Survival is what counts.Flexiblity in thinking is a good idea.

Anonymous said...

if the director of a firm decides to drop his profits in a bid to win more work, does he then have the right to reduce wages as a result? I think not.

Absolutely!! Once again, this shows an amazing, systemic failure of NZ's education system and indeed entire culture.

It is extremely disconcerting to think (and not that I reckon this is what you are suggesting) that employers could attempt to leverage wage decreases against diminished alternative employment opportunities.


This is - indeed - precisely what we are suggesting. And, for example, exactly what Roger Douglas suggested on "The Week in Politics" on Radio Socialism of all places a couple of weeks ago.

Not only are we "suggesting" it we are insisting that immediate wage reductions of 30%-50% are essential to any conceivable reform or recovery of NZ's economy

FAIRFACTS MEDIA said...

In the freelance journalism market, the word rates have remained the same, after a much appreciated raise last year.
But the work has dropped significantly.

On the salary front, I see one community paper paying the same as I paid by graduate trainees ten years ago.
And now this is barely more than the minimum wage.
If any of you have kids out there, try and talk them out of joining the media.

Interesting work, yes, but the days of it offering a good living are going/gone.

BTW Lou, pity you are busy for the ACT conference.
Now, you may be interested in a post I have done on aid, based on the comments of an African economist.

Feel free to cut and paste and post at No Minister.

Clunking Fist said...

Anon@7.55am is correct (i hope you are not PM's "Sinner"!)

If I employed folk who would not reduce their hours or salary to help the firm, then I would be left with no choice but to lay them off. I don't fancy their chances of getting the same salary in their next job...

"But the fairer situation is one that recognises that an economic downturn does not diminish the inherent value of the employee"

That DOES sound very socialist. An employee is only "worth" the value of their output.
If the employee cannot produce "output" because the business has no customers, then they have no value to that business...however, they may be of value to another business.

I think you may be confusing the idea of the "intrinsic value" that folk believe humans have.