Misaki
Senior Member
- Jul 8, 2011
- 159
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- #21
This didn't fit in the original post because of Math™, but what do you think?The basic idea can be easily summarized: pay people a higher rate when they work less time. For example, 1.2x their normal pay rate for the first 24 hours of work each week, and 0.7x their normal pay rate for all hours after that, including hours beyond 40.
Previously, I had 3 workers at 40 hours a week, now I must have 5 workers at 24 hours a week.
All for a 20% increase in payroll expenses. More, when insurance is added. Where do I sign up?
Analysis here. For businesses to support this system, they must benefit from it. The amount of work done per dollar paid to an employee must increase.
24 * 1.2 / 40 = 0.72, pay for 24 hours of work as a proportion of 40-hour work week
24 / 40 = 0.6 time worked
Work done would have to be above 0.72 in this example.
Simpler numbers: paid 20% less, do 10% less work. A business would like this.
Who would accept this deal? It seems no one would. However, if the work is completed in 30% less time, then the employee has more free time. This requires doing 90% of a standard workload in 70% of the time, a 29% increase in efficiency.
Businesses would like for everyone to be more efficient, all the time, and continue to work the same amount of time. Even if a new worker can be just as efficient as existing workers, there is still training time and other costs associated with hiring new workers. Workers must tie any increase in efficiency (working harder than other people doing the same job) to a reduction in total work done.
As described, this results in less money going to each individual worker and more money to the business's profits. Businesses and stocks are mostly owned by rich people, so rich people would seem to benefit. Even if the worker in question is a corporate chief executive officer who makes US$5 million per year, if they do 10% less work for a 20% pay cut, workers as a group are still losing money.
Workers win in two ways: more workers are hired, and spending patterns change when someone earns less money in a way that benefits workers. Total worker compensation is 4~5 times total business profits, so how workers spend money would still dominate economic outcomes even if slightly more money went to profits.
More workers hired means unemployment goes down. Even if unemployment seems low, some people still have a hard time getting jobs. People convicted of serious crimes are often denied employment. Others are forced to enter a new line of work. They may have worked for a newspaper and cheap online news has reduced interest in local news stories, or their factory got moved to Vietnam, or they were injured in a car crash, or they may be unable to continue their previous work such as online game streaming or dancing due to age. Whenever someone has a hard time finding work, they drive down wages for all workers.
9 people each doing 100% work, each paid 100%, while 1 is person unemployed.
9 people each doing 90% work in 70% of the time, each paid 80%, resulting in the hiring of 1 person to do the remaining work. Total payment is 800%, down from 900%, but now businesses give better wage offers to workers and wages goes up, either because workers find better-paying jobs or they get raises to prevent them from leaving.
The effects of modifications to spending are more difficult to understand. It relies on the principle that for two similar items, the more expensive one is likely to be more profitable and made by people with a higher total income.
As a generalization, there will always be counter-examples that make seeing the trend more difficult. Companies that sell expensive physical goods, like 'smartphones' or brand-name shoes, like to make their products using as cheap labour as possible. They may even be better at finding cheap labour, and securing good business deals that give very little money to the companies that hire people who do the actual work, than their competitors who sell less expensive and less-valued products. But lower wages for workers assembling a 'smartphone' means higher corporate profits, which illustrates the general principle: buying the more expensive product makes your money go to rich people, while buying the cheaper product makes your money go to poor people.
If poor people and rich people spent money the same way this would not matter. But they don't. Poor people are more likely to spend money that they earn (the highest quintile of households in the US, by income, don't spend a third of their income, while the lowest quintile spend more than they earn) and are also more likely to buy cheap things, causing that money to go to other poor people.
In a way that's considerably more difficult to quantify than "nine people work 10% less, one person gets a job", this altered pattern of spending that causes more money to go to poor people results in job creation.
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"30% increase in efficiency is unrealistic!" Rather than show how a business and employee can still benefit with just 10% efficiency increase — since one might disagree with any efficiency-based arguments at all — I did a web search for "stay until boss leaves".
my boss makes people work late for no reason — Ask a Manager (and comments)
Do you leave the office before your boss? : korea Korean work culture was what I was thinking of.
Is it normal to have nothing to do at work 70% of the time? : jobs
my best employee quit on the spot because I wouldn't let her go to her college graduation — Ask a Manager
I can't leave 30 minutes early? Okay then, no more free labor : MaliciousCompliance (note community name)
What can I do at my office job when I finish my work early? : jobs
Are you too scared of being caught playing 2048 at work? Play it in Excel... and your boss will think you are working the hardest in your life;) : excel
To my boss who spent 45 minutes on Friday trying to get me to reconsider quitting : AdviceAnimals
Manager told me to clock out 30 min before my scheduled hours : Chipotle
stay until boss leaves "nothing to do" site:www.reddit.com - Google Search
stay until boss leaves "nothing to do" - Google Search (34 million results)