Category Archives: jobs

Yes, and No

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Company employees are getting pay raises just for staying on the job rather than moving on to other endeavors.

Wages for workers who stayed at their jobs were up 5.5% in November from a year earlier, averaged over 12 months, according to the Federal Reserve Bank of Atlanta. That was up from 3.7% annual growth in January 2022 and the highest increase in 25 years of record-keeping.

It’s also the case that new hires are getting bigger signing bonuses, initial salaries, and more perks for joining the company.

However, this claim by The Wall Street Journal (at the link above) is mostly backwards in the present environment:

Faster wage growth is contributing to historically high inflation….

It’s true that increasing wages—increasing labor costs generally—feeds into inflation as companies have to raise their prices when labor costs eat too far into their profit margins. However, as WSJ also noted,

Prices rose at their fastest pace in 40 years earlier in 2022.

That sharp rise in inflation actually began before the sharp rise in wages, and it has far outstripped the rise in wages: 2022’s inflation peaked above 9%, and it’s still around 7%. The current wage increase is only a nominal increase. The real change in wages, what real people spend on real necessities and wants, has been negative: that 5.5% nominal increase in November, compared with November’s 7.1% inflation for instance, actually represents a 1.6% decrease in actual buying power for us average Americans.

The fact is that the current period of high inflation is driving the rise in labor costs, not the other way around.

Federal Workers Working Remote

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I agree with the concept, sort of.

The Federal Government Initiative, an NGO government watchdog, has noticed that current federal telework practices, implemented during the Wuhan Virus situation, are associated with a dramatic reduction in paid leave used by the federal workforce. The FGI has expressed misgivings.

Before the federal government engages in expanded telework in perpetuity, its impact should be investigated more fully by agency Inspectors General, Congress, and other oversight entities[.]

I agree that many—most, in fact—nearly all—Federal workers should be allowed to work remotely, and in perpetuity. Remotely, mind you, not via telework.

The Federal offices, especially the large ones, like Education, Interior(!), Commerce, Federal Reserve, Treasury, and agencies like CFTC, SEC, CFPB (these are not at all exhaustive lists) should be removed from DC and scattered around the middle-sized and small towns of middle America, of flyover country. Those offices should be among the people they serve, us average Americans, and away from the overweening influence of the bubble-residing coastal elites.

Here’s the deal, though: all of the employees should be required to come back to the office. No more teleworking. The remoteness of their work will consist of working in the small towns of the Midwest, the north, the Southeast, and the Southwest. They’ll get used to it, though, and they’ll learn that middle America isn’t all that remote, after all.

Fiddling While….

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Transportation Secretary Pete Buttigieg seems to be a modern day fiddler. During the…negotiations…with rail unions just concluded, Buttigieg chose to go haring off to Portugal on vacation. He also appears to have told no one of the public he was heading out: previously undisclosed trip, according to the Washington Free Beacon as cited by Fox News.

“The secretary took a long-planned personal trip from Aug. 29 to Sept. 5,” a spokesperson for the Department of Transportation told Fox News. “As usual, while traveling on personal time he remained available and engaged on urgent issues, which in this case meant multiple calls with staff and stakeholders to work on the topic of rail labor negotiations.”

“Long-planned.” Nothing so trivial as a looming transportation strike with national economic implications was to disturb his precious vacation. Phone calls, though. Because there’s no need to meet in person with the players. Vacation.

Florida Senator Marco Rubio (R) noted the irony hypocrisy:

Rail workers just wanted a few days of paid sick leave. President Biden told them to pound sand and his Transportation Secretary vacationed in wine country[.]

And, of course, us taxpayers continued to pay Buttigieg’s his salary—he gets paid vacation, along with his paid sick leave.

In Which Rubio is Mistaken

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The Senate passed a bill mandating a labor agreement agreed by railroad companies, management teams of a dozen rail unions, and the rank-and-file of most of those unions be imposed on all of those unions and railroad companies. The bill also barred a rail union strike.

In a separate vote, the Senate failed to pass a bill imposing a number of paid sick leave days for union employees on the rail companies.

Senator Marco Rubio (R, FL) is dismayed.

When workers are treated as little more than line items on a spreadsheet, they become indistinguishable from the freight cars they service….

And

…the measure only granted rail workers one day of paid sick leave all year—a stipulation that Rubio said “underwhelmed and alienated the men and women doing the hard work.”

And

Congress…told rail workers to suck it up and be grateful. We should have worked to meet the demands of the workers instead of appeasing labor leaders and companies.

Most, if not all, of that likely is true.

However.

It doesn’t matter how much any of that might seem like a good idea, or might even be a good idea, over the duration of a contract. It’s not government’s job to set the work compensation parameters for employers and their employees. Most especially, it is not government’s job to meet the demands of the workers. It’s government’s job to set the market conditions within which employers and employees can negotiate those parameters freely.

Senator Bernie Sanders (I, VT) wasn’t far off with his dig at Rubio: I always knew you were a socialist.

Government is a system of men and women, not an entity in itself. What those men and women might think is a good idea will vary over time for those men and women and certainly will vary as different men and women come into government from time to time. We need only see how government “good ideas” vary as Republicans or Progressive-Democrats are in ascendance from one Congress or administration to another.

At most—at most—where a national risk is in play (for instance, a steel worker industry-wide strike or lockout, or a nation-wide rail strike or lockout), government might require the two sides to settle through binding arbitration a disagreement they can’t settle through negotiation. With the arbiters chosen by the two disputants, not by government.

He Can’t Be Serious

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Can he?

Federal Reserve Chair Jerome Powell said in a speech last Wednesday that the overheated labor market needs to cool more for the Fed to be confident inflation could decrease toward its 2% goal. He said the biggest remaining barrier to taming inflation is a worker shortage, which is driving up wages and, in turn, the cost of goods and services.
“The labor market … shows only tentative signs of rebalancing, and wage growth remains well above levels that would be consistent with 2% inflation,” Powell said. “We want wages to go up strongly, but they’ve got to go up at a level that is consistent with 2% inflation over time.”

How is it business’ fault the Federal government insists, via monetary policy, on paying able-bodied workers not to work with its wealth of welfare payments?

How is it business’ fault the Fed initiated the present high inflation with its own profligate fiscal policy of injecting trillions of dollars into our economy with its artificially suppressed interest rates and its heavy Federal debt funding?

How is it business’ fault that the Federal government and the Fed insist on working at cross purposes in “managing” our economy and fighting inflation instead of letting our erstwhile free market economy—an intrinsically self-correcting economic system—run free and bring that Fed-government-caused inflation under control?

How is it business’ fault that they keep raising wages within their other inflation-caused rising costs so their employees can at least lose inflation-caused value on their wages more slowly?