Worker shortage = worker power
Building a people-centered economy is one of our essential values.
Hello dear friends - here we are, nearing the end of July, high summer in my hemisphere. This summer, as the economy tries to emerge from the damage of the worst of the pandemic, I see a lot of news coverage about worker shortages. A lot of hang-wringing that restaurants, retail outlets, and other businesses cannot hire enough employees.
In a way, I think a little worker shortage is a good thing. When labor becomes precious, it is worth more, and the balance of power shifts away from owners and investors to workers. (See the video linked after the photo below from former Labor Secretary Robert Reich.) That’s “the market” at work - and the backlash is already building, seeking to shift the power back.
We are going to hear and read stories pushing the narrative that the money pumped into the economy by the American Recovery Act and other administration programs is creating lazy people who do not choose to work. When you encounter this narrative, hear the echoes of old racist and classist tropes. And recognize who benefits from this story: Cheap labor benefits large businesses the most.
The narrative being promoted, however, usually puts small businesses front and center, claiming they will have to close or raise prices. But remember this: in a consumer-driven economy, when working class folk make more money, they also spend it. They catch up on purchases they’ve not been able to make, and if they have more disposable income they tend to spend it quickly.
Small businesses often benefit from this increased purchasing power - IF, that is, they haven’t been put out of business by the behemoths who can still push labor costs down by outsourcing, or push product costs down by vast scale. Large corporations benefit more from high stock prices. They focus on stockholders, not stakeholders. And stock prices soar when costs for labor go down.
This wealth is typically not invested back in communities - in people. It is invested in making more capital. When you confront the claim that the government should not put its “finger on the scale” in favor of workers, that the free market should be allowed to operate, consider that for at least the last four decades the tax code has privileged capital over wages. In other words, money generated by labor is taxed more aggressively than money made from investment. That’s a “finger on the scale” in favor of corporations and large investors.
And so, we will continue to hear and read a great deal about the danger of empowered workers - imagine, folk who can actually choose where to work based on compensation and benefits, instead of being forced into taking any job available!
Our task is to resist being taken in by the backlash narrative, and hold strongly to our intention to rebuild an economy based on our values: inclusion, equity, and people first.
Be safe and well - take good care.
Here’s a short video from Robert Reich on worker power: