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No One Wants to Work [For You] Anymore: The End of Oligopsony

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[NB: Note the byline above, thanks. /~Rayne]

There are few ways faster to piss me off than to say, “Slackers don’t want to work” in response to the lack of candidates for low-wage jobs.

This is what it looks like when a monopsonic or oligopsonic labor market is broken. It looks like workers can pick and choose the opportunity which best suits their needs rather than grabbing the first opportunity offered them because they are in precarity.

An oligopsony (from Greek ὀλίγοι (oligoi) “few” and ὀψωνία (opsōnia) “purchase”) is a market form in which the number of buyers is small while the number of sellers in theory could be large. This typically happens in a market for inputs where numerous suppliers are competing to sell their product to a small number of (often large and powerful) buyers. … [Wikipedia]

But there are more than one buyer (monopsony) or even very few buyers (oligopsony) of labor, you might say. Superficially you’d have a point.

Inside a one-mile stretch of the main thoroughfare where I live in Midwestern Suburbia, I can find 8-12 signs advertising job openings right now. I’ve lived here since the late 1970s and I’ve never seen this many postings for jobs.

Every single one of these jobs pays between $3.67 (Michigan’s minimum tipped hourly wage) and $15.00 an hour. None of them are full time, most have variable schedules, and only one place assures workers one weekend day off every week. None of them offer health care or childcare assistance of any kind. None of them offer enough hours regularly with enough compensation to pay for a one-bedroom apartment within walking distance, and likely not within a 10-mile radius.

Until the pandemic, these employers were able to tell workers what they’d pay, take it or leave it. They could act in concert without having to coordinate to set market pricing because it was simply understood by workers that hourly workers’ pay fell in this range and it was an employers’ market.

Employers have acted like a cartel, with collusion on price fixing for labor enabled by other monopolistic entities like Facebook and Google.

Workers may have thought they had some inside information through access to technology, but the same resources which informed them what to expect for compensation also told employers what to indicate as expected compensation. It told them what their competitors were paying.

Further, employers could buy the continuation of their high profits, I mean, low wage environment, simply by donating to a member of Congress directly or through a business association like the U.S. Chamber of Commerce. These same purchased entities also did their best over the last several decades to reduce workers’ rights and suppress unionization.

It’s been cheaper and more reliable to buy a GOP member of Congress than to increase automation or to pay workers a living wage.

It’s also worked so well for so long that idiots like Sen. Marco Rubio unquestioningly parrot employers’ complaints as plain fact, ignoring how many voters are workers while sucking up to potential business donors:


Never mind the cost of living for low-wage workers, though.


Seriously, Marco Rubio is a bought-and-paid-for moron who, along with the rest of the GOP, could give a shit about the lives of the working class.

What the pandemic has done is broken the undocumented employer cartel and exposed the lack of bargaining power low-wage employees have had for decades. That unemployment compensation — a ridiculously low figure which doesn’t truly provide subsistence income — is more than what employers have paid these workers is revealing. They’ve gotten away with forcing precarity on workers to keep profits up, distorting whether their business models were legitimate. Some of the precarity is bound up in deliberately unlawful behavior including wage theft.

With a bare minimum of unemployment and pandemic aid, these workers have had breathing room to decide whether to go back to work and risk their health, or wait for more people to be vaccinated. They’ve had financial space to stay with their kids who still don’t have adequate childcare available or adequate support should schools need to transition back to remote classes on short notice.

These workers have also simply had enough — enough putting themselves at risk, jeopardizing their families’ health, enough of being bullied by employers and customers alike.


…


…


This is just pathetic — a sandwich? Employers are going to respond to all that’s wrong with current working conditions by chumming applicants with sandwiches?


McDonald’s franchises have been offering cash ranging from $50 in Florida to $500 in Pennsylvania to applicants who showed up for an interview. At least one franchise is alleged to have called the state’s unemployment bureau to turn in applicants who didn’t accept their employment offer, in an effort to terminate their unemployment benefits.

All these nasty anti-worker machinations just to avoid paying a living wage, which employers know is the reason they aren’t landing applicants:

So, in an effort to attract new employees, a Tampa McDonald’s is now promising $50 to anyone who just shows up for an interview.

Local McDonald’s franchise owner Blake Casper, who also owns Oxford Exchange, told Business Insider that a manager at his Dale Mabry and Chestnut location came up with the idea, but far so it hasn’t really yielded much success. …

Of course, one way to attract new employees is to just pay them more, and while he hasn’t done it yet, Casper told Business Insider he’s now considering raising starting wages to $13. As of now, according to a job posting on Indeed.com for the same Dale Mabry McDonald’s location, new employees can make up to $11.50 an hour.

Last year, more than 60% of Florida voters approved a constitutional amendment to raise Florida’s minimum wage to $15 per hour by the year 2026.

Workers clearly believe 2026 is too long to wait for a living wage — and $15 an hour in 2026 may not be a living wage by then, given the rate at which real estate investors have forced rental prices out of reach for low-wage workers.

Employers know better, and yet they have the goddamned balls to ask for more free labor:


Mind you, no more than three free days a month or the company might get in trouble — oh, and do be sure to dress like you’re being paid for it.

Workers would rather bust hump on their own, eat deterioration of their own vehicle and amortize it rather than take a minimum wage hourly job:


When they work as a contractor on a gig job, it pays better and their boss isn’t a bullying asshole who puts their safety at risk.

But of course the GOP has a problem with helping these small business persons with their tiny entrepreneurial aspirations who are trying to earn a living wage while not risking their physical and mental health:


Meanwhile, journalists aren’t asking key questions, rolling over and playing dead for the likes of Marco Rubio when he trots out the fascist conventional wisdom that workers are lazy. They aren’t asking businesses if they’re re-examining their business model the way workers have had to re-examine their priorities.


The least we and journalists should be doing: asking business-owned chumps like Rubio more pointed questions about employers, especially when they’re buying support yachts for their mega-yachts:

Soft-Handed Academic Dudes and Minimum Wage Fast Food: What Could Go Wrong?

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I see tweets like this one in my timeline and I brace myself for the inevitable dogpile bashing workers:

Unemployed minimum wage workers have collected too much from state unemployment and federal aid, the old white dudes opine from their cushy home offices somewhere in McMansionburbia, nudge-nudge-winking about prescient forecasts of inflationary pressures.

Sod off, you slack-bottomed, soft-handed gits.

Unemployed minimum wage workers were most likely to be laid off early in the pandemic, and may already have been laid off not once but twice or perhaps even more, depending on location and on whether they were or are juggling one or more minimum wage jobs to make ends meet.

These are the same workers whose jobs OSHA has categorized as High Exposure Risk:

Those who have frequent indoor or poorly ventilated contact with the general public, including workers in retail stores, grocery stores or supermarkets, pharmacies, transit and transportation operations, law enforcement and emergency response operations, restaurants, and bars.

They’re in the same risk class as mortuary workers who prep the bodies of those who died of COVID.

This group of workers are among the risk class most likely to experience an outbreak of COVID; just look at the workplaces where Michigan had outbreaks as of April 9:

Not as bad as schools but how many of the K-12 and university students overlap in some way with fast food workers — either as consumers or employees?

Recall my chicken scratching from my last post about the unaffordability of the American Dream in which I calculate annual earnings for a full-time minimum wage worker:

Do the math:

Minimum federal wage $7.25  x  40 hour week  x  52 weeks  =  $15,080 a year.

That’s nowhere near enough to make a payment on the median home priced at $301,000. It’s not enough for a tiny dump of a house at one-third of median price.

The equation above already contains numerous generous assumptions: the employee makes 1) minimum federal wage, 2) at a full-time job, 3) for the entire year. For most minimum wage workers, at least one of these three points doesn’t apply. Most employers who hire minimum wage workers avoid paying unemployment taxes by employing workers less than full time, which means a minimum wage worker must work two jobs (or more) to make $15,080.

The average one-bedroom or studio apartment costs roughly $1000 a month right now. What’s left over for food, health care, transportation? Even if a worker can manage a roommate or two, what’s left over for basic needs?

Gods help them if they need childcare or eldercare on top of shelter, food, health care, and transportation.

And with most employers refusing to hire minimum wage workers for more than 27-32 hours a week in order to avoid paying either unemployment insurance tax or contribute to health care, these workers are likely not to have any benefits like sick or paid time off, or any savings to offset time needed for illness.

Why would any food service or retail employer think for a moment that minimum wage workers should be beating down the doors to come back to more of the same if their health and their lives had been and could be again at risk, for an absurdly low wage? Why can’t the usual pudgy white neoliberal male academic types grasp this?

The snotty, dismissive attitude by business toward minimum wage workers reflected in the tweet above — though labor appears to be an essential component to the business — also reveals both carelessness and cluelessness of these businesses. If a piece of equipment needed repair for the business to remain open, they’d fix it. But apparently remedying the problems their workers face is a step too far or opaque to the business operator.

Minimum wage workers also need the right to organize. Amazon may pay more than the federal minimum wage, but there are businesses across the U.S. which also operate like Amazon but without the notoriety forcing Amazon to pay better wages. Those businesses must be forced to rejigger their business models. Amazon is no model employer, either; overall conditions are bad when Amazon looks good by comparison.

But demanding businesses rework their operations to protect workers’ right to organize is too much to ask, one might say. Is it?

When businesses shut down sites to avoid unionization, they are rejiggering their business model, and they are doing it at a cost to the community as well as the workers. They are eating the cost of the closures to make an ugly point.

Kroger’s Seattle locations aren’t the only two sites the grocer is closing for this reason. At least three more closed in California to avoid paying higher wages to their workers who are disproportionately at risk of COVID — wages mandated by local government to ameliorate the risks these workers take.

Workers need Congress to pass the Protecting the Right to Organize Act of 2019 (PRO Act) for this reason, as do their communities. Many older and disabled Americans rely on their local grocers; losing one is incredibly disruptive and expensive, especially when it creates a food desert. No business is obligated to do business in any location, but a business willing to pull up and leave a neighborhood and damage customer relations solely because it can’t (read: won’t) figure out how to pay a living wage needs to do its own reorganization internally, restructuring its business model to operate ethically. A workforce which has the right to unionize may be the only way to force business to reset its thinking and operations.

In other words, if a business’s profits rely on paying wages which can’t support a worker, the business model isn’t legitimate. Unions may be the only means to make this clear to businesses.

Something needs to give soon, because this kind of scenario will continue — a clueless business thinking it must hire anybody at less than living wages, to work in conditions which may not be safe for either employees or customers.

The Youngsville mother of two was taken aback at the offer since she was only trying to go inside to get the food that was left out of her order after going through the drive-thru a first time. The lobby was closed, so she went back to the drive-thru window to get the order straightened out.

Then she learned why the lobby was closed.

“The manager told me, ‘I’m sorry. I can’t open the lobby because no one wants to work,’” Picou said. “And then she asked if I wanted a job. She said they’d hire anyone at this point.”

Imagine thinking a fully-staffed indoor fast food lobby is necessary in the middle of a pandemic, instead of creating a safer alternative.

Waiting for those slack-bottomed academic types to nod their heads vigorously in affirmation as they wipe the fast food mung off their faces.

You’ll notice that young mother in that article didn’t jump at the offer.

Let Them Eat (Starbucks’ Coffee) Cake

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A couple of older billionaire white dudes have been shooting off their mouths. One of them is partially clued in. The other one apparently lives on a different planet where the sky is a groovy coffee-colored plaid.

I’m sure I’m preaching to the choir when I point out these facts:

The links above include scolding by financial experts who say Americans need to do a better job of saving. But…

Don’t get me started on what college tuition and subsequent debt does to Americans’ ability to save.

We all know that health care costs have not improved and remain the leading cause of bankruptcy in the U.S. even though more Americans have health insurance under ACA.

And rich older white dudes are completely, utterly, hopelessly out of touch about the financial facts of life for nearly half of Americans let alone the next 2-3 deciles.

Like Wilbur Ross — our Commerce Secretary who lied about his assets and clearly knows nothing about Americans’ daily commerce — struggled to comprehend why federal employees might need to use a food bank after missing a paycheck.

Just get a loan, Ross thinks. Sure, sure, banks give signature loans to people without any collateral let alone a source of income all the time. Come on, Wilbur: would you invest in a bank offering those kinds of terms to the average Joe/Josephine off the street?

And then there’s Trump, who thinks we can just ask the grocer to extend some credit for an unspecified period of time. Right — a nationwide grocery chain clearing 1-3% a year in profits can afford to extend credit.

So goddamned clueless he is. I’m only surprised he didn’t tell furloughed federal workers he’d give them a 5% discount to play golf at one of his courses during their free time.

76-year-old billionaire Michael Bloomberg, who thinks he’s still young enough to run for president in 2020, trashed Sen. Elizabeth Warren’s wealth tax proposal as “probably unconstitutional,” thereby revealing his brain’s atrophy. If taxing higher levels of income wasn’t unconstitutional under Hoover, Roosevelt, Truman, Eisenhower, Kennedy, Johnson, Nixon, Carter, then it probably isn’t unconstitutional.

And then Seattle coffee magnate Howard Schultz popped off at Rep. Alexandria Ocasio-Cortez’ proposals to increase marginal tax rates on the uber-wealthy, calling her “a bit misinformed” and her proposal “un-American.”

Except the U.S. had higher tax rates on the wealthy, for most of the 20th century. The country could afford to build more infrastructure; it built a successful public school system and went to the moon. How nice for Schultz that he could grow up and become a young entrepreneur in that economic environment.

(Put a pin in here for future reference, as a reminder that Schultz not only called AOC “un-American” but Sen. Kamala Harris, too. It’s as if he has a problem with women of color…)

Schultz thinks he has become a billionaire all on his own, as if the increasingly fascist political system with its active suppression of younger, marginalized citizens played no role in his wealth accumulation.

As if the last two decades of stagnant wages due to employment monopsony, repressive Federal Reserve policies, and the real estate market haven’t helped line his pockets by assuring low-wage workers get locked in and unable to move to better paying jobs.

Schultz has been able to accumulate massive amounts of wealth on the backs of people who aren’t being paid living wages, out of the wallets of those whose limited resources allows them to buy a coffee but not a house or health care. He’s rolling in a sea of cash because minimum wage workers are living in little more than indentured servitude.

You know what’s really un-American?

An ungrateful and narrow-minded billionaire white dude who doesn’t think living wages and health care for everyone are fair, who thinks that higher taxes after his first $50 million are theft.

A purveyor of luxury beverage products unable to grasp the unselfish commitment it will take to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general Welfare, and secure the Blessings of Liberty for all the people.

At least Bloomberg sees the danger Schultz’s presidential candidacy poses to this country.

But Schultz isn’t in it for the country’s benefit. He’s in the race for himself. It’s clear he’s done the number crunching and determined that it’s cheaper to run for POTUS even if he were to cause Trump to win re-election. (I’ll bet he’s even figured out how to write off his exploratory trips around the country as a business expense.)

Because the campaign expenses are less than the cost to his personal wealth if he were taxed at a higher rate and if he were also forced to pay living wages to his workers.

What a pity Schultz hasn’t calculated how much more overpriced, excessively roasted coffee minimum wage workers can buy if they didn’t have to worry about health care expenses on top of their rent.

 

Treat this as an open thread.