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Discussion (134 Comments)Read Original on HackerNews
I’m not sure that raising the median wage is even more desirable than raising the minimum wage. If the median wage enables a good life but, say, the lowest quartile is precarious exploitative jobs close to the poverty line then raising the minimum should increase overall happiness more than just raising the median.
Worth keeping in mind when doing any apples V oranges country by country comparisons of population percentages in poverty.
* AU: https://povertyandinequality.acoss.org.au/poverty/
* UK: https://en.wikipedia.org/wiki/Poverty_in_the_United_Kingdom
* US: https://en.wikipedia.org/wiki/Poverty_thresholds_(United_Sta...
The frictions we're talking about, like health insurance being tied to an employer, make things worse for families anyway - getting rid of the distortionary regulations that cause that can only be a good thing.
Much like housing, the best solution usually isn't government price controls. Better (if feasible) is abundance in the market.
I think a flat tax + UBI is the only way to go. The dream of AI should be a society where maybe 10% of people have to work. The nightmare is if the other 90% still need work but can’t find it.
I've often felt that I'm not very good at a particular company until I've been there 4 years... then I can really do good work. I wonder if there is any downside for society to incentivize switching often.
Ideally, you want to have a dynamic economy where people have very many paths to prosperity. In the US, you have people like Ted Sarandos who managed video rental stores for 17 years before taking a job at Netflix, which eventually led him to become CEO. Or you have Doug McMillion, who started at Walmart in 1984 unloading trailers at a distribution center and rose up to the CEO position. And you have Dara Khosrowshahi, the Uber CEO, who started his career in investment banking, became a media executive, and then served as Expedia CEO. An of course, there any plenty of extremely successful entrepreneurs who never worked for anyone else before founding their own company.
In my industry, 2 years is about what it takes to feel the ramifications for your bad decisions. Leaving before then makes you a bomb thrower in my not so humble opinion, leaving everyone else holding the bag. And unless you are a contractor, it's a resume red flag for me.
I get that not all jobs work out, but a long string of < 2 years makes me skeptical.
Maybe we can fix the things that make workers uneasy in the first few years.
Greater turnover is good for all employees and worse for employers
It’s my observation a high-turnover business is often good for nobody. There’s more spent in retraining etc than if you just paid halfway-competent people properly instead of literally rolling the dice every year or more.
Since the early 1980s, start of the Millennial generation, inflation is 300%; takes $800k/yr to have the buying power of $200k/yr in the 80s
Millennials and GenZ have only ever known austerity and oligarchy.
And that Exxon computed the min-max of the climate trend back in the 1970s just says they know, given all the data, they know.
GenX edge lords don't give shiiiit
https://www.nytimes.com/2023/08/25/style/gen-x-generation-di...
I have zero respect for people >50 especially any in official policy roles. Zero fucks for anyone but themselves this whole time; ignored reality just like religious nutters and presumed political dogma would be on their side
Jokes on them; Millennials are even more convinced it all just goes black with death, fewer young people going into elder care jobs, population decline crushing those jobs... GenX can enjoy hobbling to their toilet unassisted with bed sores and gout. Fuck them too then
The minimum wage is a strawman by comparison: it doesn't actually help workers.
Gig-work like Uber is a great safety valve to enable instant job hopping for unskilled labour. And not just the job hopping itself, but also the threat of job hopping.
Like healthcare being tied to employment?
Since a public option will never happen, maybe the most feasible fix we could do is to do a REAL version of the P in HIIPA - portability. Let employees stay in the group plan of any company, paying the full premium a la COBRA, but forever, and require companies to give a tax-deductible cash benefit equivalent to the premium subsidy they'd be entitled to in their new job, if they show proof they're in a COBRA plan (which for efficiency, should just be a flag in some government database since they're all up in our business now with the 1095 forms anyway, they ought to know).
And while it is inefficient if a company has to constantly retrain employees, overall you can have a more efficient market when people are given options, since employees can find the best fit. If you're working a job that isn't the best possible fit (something that's harder to find when your limited by time and resources) that's worse overall for the economy.
Of course there's more nuance here, but this is the core debate of unemployment payments. More unemployment benefits incentivizes people to stay unemployed longer (bad), but when they do find eventually find employment, it's usually better employment (very good).
If your mindset is "The economy is an incredibly dynamic, living thing whose purpose is to satisfy the consumer desires of the moment", then job-hopping can be all of very satisfying, very lucrative, and very purposeful. Your purpose is to do whatever is most needed. You don't get attached to any one task, but treat yourself as malleable and adaptable, and think of your past roles as a portfolio of skills and experiences that you can draw on to meet new challenges. You could describe your approach to work as "Work is something I do, not what I am."
If your mindset is "The economy is the society that I grew up in, and I'm seeking my place in it, and then I want a role where I can grow and build expertise", this is extremely unsettling. You view your job as an identity, a part of yourself. To leave that job is to leave a part of your identity behind, and to be fired or laid off is to have a part of your identity ripped away. And so you'll fight hard (and take many poor bargains) to avoid being put in that situation. It's not simply a matter of economics; it's a matter of being and belonging. Work is not just what you do, it is who you are.
Commerce vs. Guardian syndrome [1], or growth vs. fixed mindset [2]. There isn't really a right answer, but American culture, society, and business favors commerce syndrome over guardian syndrome, while many other cultures (really, most of the rest of the world) is the opposite.
[1] https://jebkinnison.com/2016/04/29/jane-jacobs-monstrous-hyb...
[2] https://online.hbs.edu/blog/post/growth-mindset-vs-fixed-min...
A certain amount of churn is good on the national or even global level, because it moves knowledge between companies. Probably not great for the company you depart, but great for the company you arrive at.
Also who wrote this theory? Sounds like the wet dream of some neoliberal econ grad.
That's good because you don't have to rely on corporations acting morally, and corporations who do act good out of moral obligation aren't punished fiscally for it. It also just works better than adding a price floor, if done right.
And although the idea is sexy, it's far from a wet dream. It's actually the standard in the Scandinvan social democracies.
https://en.wikipedia.org/wiki/Flexicurity
so job hop
the market is trying to tell you something
The new budget just got approved. Last year a teacher with 15 years of experience made $58,270 and this year they will make $62,500 so right around an 8% bump but the prior two years was only a ~$1000 bump each.
So 2023 -> 2026 $56,250 -> $62,500 was roughly 12% increase in pay but adjusted for inflation $62500 in 2026 is ~$57,220 in 2023 so not even an actual raise of $1000 in buying power.
Although I heard they also fired some of those people with high rsus! So it goes both ways.
Either way, definitely not "might as well round to zero". I have never worked anywhere where that was the case.
Check the prices of the flagship 1975 Ferrari, the flagship 1975 Hasselblad camera, or, I don't know, a 1975 Cessna 182 in reference to median 1975 household income.
Then check it again for 2026.
Oh, but we have GPS, Amazon Prime, and doomscrolling now.
Thanks, I'd rather take the Cessna.
Welcome to the progress and “better world” that Tech Bros promised while they reaped billions of the VC/PE economy
> and the remaining 94% increase their earnings.
This is an extremely unrealistic expectation. There are a multitude of reasons for people's incomes to fluctuate other than retirement. People make career changes that result in lower income for many reasons, like taking a better job, changing careers, transitioning to a lower demand job when they have children, or moving to a new city with lower wages for personal preference.
For many jobs the earnings are also dependent on the company's earnings. Incentive structures, bonuses, RSUs. Even low paying companies scale their staff up and down based on demand. They can't hold a monotonically growing set of staff and also monotonically increase their wages when the incoming demand for their product is not monotonically growing.
The only way to come close to an "idealized society" like you're proposing is a totally self-sustaining, command and control economy where a central authority determines not only everyone's income, but their expenditures too. It's not possible to keep the entire economy and everyone in it moving in the same direction unless you're dictating where all of the money goes in society to a fine degree. Variations of this have been tried. The members of that society do not find themselves more well off.
The only thing that surprised me about this article is that more people didn't see real wages decline. 2021-2024 was a period of peak inflation that the US hadn't seen in decades. And of course the primary cause of this inflation was governments flooding dollars into the market by literally paying people not to work, which while perhaps faulty was at least a reasonable response to Covid. The ironic thing is that, in the US at least, the inflation rate was coming down before we decided to install the guy who instituted massive tariffs, an unprecedented deportation program, and an unprovoked war in Iran, all of which are highly inflationary.
So it's completely unsurprising to me that wages, especially of people who stayed in the same job, didn't accelerate faster than inflation. This feels a bit like picking your dates to tell a narrative. I'd be much more interested in the percentage of folks whose wages fell in real terms by looking at multiple overlapping 5 year timespans.
I don't think this is a reasonable expectation at all. In the absence of economic growth I would expect the average individual's earnings to be flat.
The only way for wages to go up across the board is if productivity increases. If you're not creating more wealth than last year, the only way for one person's wages to go up is if someone else's goes down.
In that scenario, each individual worker sees increases over their lifetime, even though the average stays flat.
From page 36 of the paper: All deciles during this earlier period experienced annual real wage growth, with the growth being the largest for the bottom two deciles of the wage distribution.
The share of wealth owned by the richest people went up far more than the bottom 90 (or even 99) percent. The data absolutely supports this perspective as well: https://www.federalreserve.gov/releases/z1/dataviz/dfa/distr...
> This compression accelerated in 2021: real wage growth in the bottom two deciles remained positive and close to its pre-period pace, while all other deciles experienced declines of about 2 percent, roughly four percentage points below their pre-period growth
However, it does says that 58% of all workers failed to keep up with the real wage growth trend we saw in the years leading up to the pandemic.
>So 63% didn't.
But more than a third of Americans did. You can't "glass two-thirds full" tens of millions of people seeing their actual purchasing power decrease.
Total compensation includes stock options, stock grants, health insurance premiums, 401k contributions, so-called "employer social security contributions", retirement contributions, time off with pay, etc. Total compensation averages 146% of wages.
This is not a triviality.
The paper doesn't cover this, and so the conclusions don't have merit.
Labor Productivity for Manufacturing: Household and Institutional Furniture and Kitchen Cabinet Manufacturing: (has flattened out in the last decade-ish)
https://fred.stlouisfed.org/series/IPUEN3371L000000000
Construction has been DOWN for decades (and is 7 percent of the labor force).
https://www.richmondfed.org/publications/research/economic_b...
Food Manufacturing is in decline as well:
https://fred.stlouisfed.org/series/IPUEN311L000000000
And you can be pretty sure that many workers would walk if the extra goodies they are accustomed to but which ain't guaranteed were to be withdrawn. Assuming the competition still provides them.
I don't know how available this is to folks who aren't Mennonite or Mennonite-adjacent, but it's there.
Premiums for a silver plan can easily be $30k per year for a family of 4. If an employer decides to cover 70% of it instead of 80%, that is literally a pay decrease of $3k, not to mention possible changes in coverage, deductible, and oop max.
For example, the employer could keep the 80% subsidy, but increase deductible from $1k to $10k. Unless premiums go down a lot that is basically a huge pay decrease too.
Interactive brief: https://bfidatastudio.org/project/sticky-wage-norms-and-the-...
These youngsters talking about 2020s have no idea!
https://www.gasbuddy.com/charts
Source: https://fred.stlouisfed.org/series/WALCL
The Biden admin brought down inflation much faster than even optimistic economists predicted, while maintaining full employment and avoiding a recession. The US economy during that period significantly outperformed most other wealthy countries. (As one indicative example, the cover story of The Economist from October 2024 was titled The American economy: The envy of the world.)
Since then we've had a wide range of completely self-inflicted policy faceplants, including notably several rounds of illegal tariffs and a war with Iran.
However, you are also correct that Trump pressuring OPEC to cut oil production at the end of his first term did cause additional inflation in Biden's term.
LOL