Jobs (an Economic Issue)
In our society, we use money to pay for food, clothing, shelter and many other things that are necessary or desirable. Most of us work at a job where we exchange our labor for this money. In theory, if we want to buy more things, we could simply work more to get the needed money. In practice, it is not always that easy. First off, most of us will need and want more out of life than just work, so there will always be a limit to how much we would be willing to work. Then, there is a limit as to how many jobs are available to get and how secure any one of these jobs will be.
Jobs can be fun, boring, stressful, or mentally or physically challenging. They can return a sense of pride or accomplishment, provide social interaction or may just be a source of a paycheck. We can work for a big, medium or small company, or even work at our own business. We might consider our job to be a career, a profession, an occupation or just work. We can work full-time, part-time, or on a temporary basis. We can also work for a salary, for an hourly rate, for commissions, or for tips.
Jobs also come with a wide range of requirements for such things as education, skills, experience, appearance, and security clearance. Every job has some requirement, even if it is just being available to work the right hours.
In general, the more effort we need to put into preparing for a job through education or training, or to stay up to date with a job's requirements, the more that job will pay. Therefore, to some extent, our job’s pay reflects the time and the effort that we needed to spend outside of work to do that job. In addition, many other things can affect our job’s pay such as what employer we work for, where the job is located, how dangerous the job is, how many others are qualified for the job, and how well we do the job.
Even with all the right qualifications, we will still need to be able to find, to get and to keep a job. If employers are not hiring, are laying workers off, or have too many qualified candidates, then we may not find, get or keep a job. Without a job, we may not be able to pay the bills. In time, this could lead to bankruptcy and to eviction from our home. We could end up being homeless, and may need to beg, to steal, or to live off someone else’s charity to survive.
One of the most important responsibilities of our government is to protect us. If we are unemployed, our government could simply continue to compensate us until we find work. However, this would put a heavy tax burden on those of us who are still working and who would need to support those of us who are not working. In addition, some of us might simply decide not to work, since we could get paid for doing nothing.
Therefore, it would be much better to ensure that we could all earn our own living. In other words, each of us who wanted to work and who put in the effort should be able to find, to get and to keep a job. Of course, having us do jobs that just entail doing busy work doesn’t really help. Therefore, we must also ensure that we are being paid for work that is making a productive contribution to our community.
Our earliest ancestors were hunters and gatherers who lived in small tribal groups. They needed to know how to make some simple tools, to find shelter, to make clothes, to find food and water, and to protect themselves from the dangers that were all around them. This might not seem like a lot, but there was still a lot to know, and it was not an easy life. There may have been some division of labor, most likely between men and women, but everyone pretty much had to know how to do just about every job. Over a lifetime, at one time or another everyone may have had to work at just about every type of job that existed.
In those small tribal groups, it was very important for everyone to do their fair share of the work. Everyone’s work contributed to the survival of not only themselves, but to the survival of the entire group. Some of them may have made some or all their own clothes and tools, but everyone needed to work together to obtain enough food and water, and to keep everyone in the group safe. Back then, there was no real concept of being unemployed. Everyone had to work, even the children.
When someone was sick or injured, the others in that person’s group could usually do a little extra work until that person got better. On the other hand, anyone who routinely did not do his or her fair share of the work would have made life much harder for everyone else in the group. Eventually, the group would have had no choice but to expel this freeloader, so that the survival of the whole group was not put in jeopardy. Just to survive, an expelled freeloader may have needed to work much harder than he or she would ever have needed to work as a productive member of the group.
Over time, our ancestors created better tools, developed agriculture, and domesticated animals. This allowed them to produce more food, which in turn allowed them to support larger groups. This also led to the creation of more and varied types of jobs, which were often much more complex than previous types of jobs. This made it increasingly difficult for anyone to know how to do everything and led to the need for many of them to specialize in doing just one type of work.
Some of our ancestors ended up farming or tending livestock, some others made tools or clothes, while others did a variety of other jobs. As time went on, the diversity and complexity of these different types of jobs became even greater and they had to specialize even further.
During this time, our ancestors also started bartering, and trading goods and services, which eventually led to the invention and the use of money. Groups moved away from sharing the fruits of their common labors, and families and individuals had to earn a living from their own work. Since the value that they placed on the goods and services produced by different jobs varied widely, some of them became wealthy and others became poor. Some of them even became unemployed when their skills were no longer needed or too many others could do the job better or for less.
Over time, there have been tremendous increases in productivity that have reduced the time and effort (labor) needed to make many things. This has reduced production costs so that businesses with these productivity gains could make more profit and pay larger shareholder dividends and employee salaries. In addition, consumers could buy more of these business’ products for less.
With the additional disposable income that comes from productivity gains, we could buy more of the things we needed and wanted. In response, we and businesses have come up with many new products and services to sell, and more of us are employed making and providing these new things that we are now buying.
With continued productivity gains, some businesses will not need as many workers. However, with us continuing to buy more new things, businesses will need workers to make those new things. Therefore, those of us that are no longer needed in one business should be able to find work someplace else. Of course, many of us who were laid off may first need to go back to school to learn how to do the new jobs before we can get hired.
This situation creates a delicate balance between the productivity gains that are reducing the need for workers and the increased consumption that is increasing the need for workers. If these two forces remain in balance and we continue to work about the same average number of hours per week, then our unemployment rate should remain stable. Unfortunately, a balance between productivity gains and increased consumption cannot always be maintained.
For businesses and society, productivity gains are a good thing. They reduce costs, build wealth and improve our way of life. On the other hand, there are a lot of problems with trying to increase consumption rates. First off, there is a point where we simply will not have the time to enjoy having more things. In addition, the resources we need to make many things are limited, which puts an upper limit on how much we can produce for a given size population.
Therefore, without a fundamental change in the way we handle employment and the average number of hours that we work, more and more of us will become unemployed or underemployed. This would lead to a larger divide between those of us who are rich and those who are poor, which in turn would lead to greater social unrest. In recent history, we have already seen these things happening.
Usually, unemployment and underemployment are two of the biggest problems and greatest dangers that our modern society has faced. Not only do the unemployed and underemployed run the risk of not having enough money to buy food and clothing and of becoming homeless, but the rest of society also ends up paying a high price. Employers and the employed must pay for unemployment insurance. Taxpayers must support welfare. Charities need donations to help both the unemployed and underemployed. In addition, some unemployed individuals turn to crime. In all these cases, society must pay the price, willingly or not.
In 2022, we had an exception to our usual unemployment and underemployment problems. We had a lack of workers. After the pandemic, our economy came roaring back, but not all workers were ready to come back to work. For instance, some individuals were still worried about getting sick, others could not find childcare, some individuals were holding out for higher pay, and others decided to retire early. However, if nothing is done to fix our underlying employment issues, our unemployment and underemployment problems will return.
As our society continues to grow more complex and globalized, so does the job market. Job skills that were once prized are no longer needed. Many of today’s best paying jobs require years of specialized training, but do not have any guaranty that there will be enough jobs available that utilize the skills that we have learned.
On the other hand, there are many jobs that do need more workers. These jobs may physically or mentally be very demanding, so not enough of us seem to be willing to do them, at least for what they pay. Even when the pay is high, not enough of us seem to be interested in investing all the time and money it would take to learn how to do some jobs. Without local workers willing and able to do the job, employers have no choice but to send the work someplace else.
Supply and demand play a big role in preventing the unemployment rate from dropping below some minimum amount. When unemployment is lower, businesses may need to compete more for workers, which may mean paying higher wages or offering more benefits. Of course, many businesses have another option. They can move some work to other communities or countries where they can pay less. This means unemployment may remain higher than we would like it to be, even in good economic times. In addition, when unemployment is higher, there are more of us competing for the same jobs, so businesses can pay us less, which can help them make higher profits.
One of the biggest contributors to high unemployment is our overpopulation. Although it is true that a larger population would have a higher demand for goods and services, and more of us would need to be employed to produce those goods and services, the larger population would not increase the employment rate. In an ideal world, the average person would consume the same amount no matter what the population was, and it would take the same amount of labor to produce what this average person consumed.
The problem lies in the fact that we do not live in an ideal world. In our real world, our resources are limited, and our overpopulation means that there are not enough resources to go around. The higher demand for our limited resources has led to higher prices for those resources. With higher prices, some of us will need to do without the goods that are produced from these resources. With less of these goods sold, the workers who would have made them will instead be unemployed.
Every year, the public demands jobs and our political leaders promise to create jobs. The usual method of attracting jobs is for a community to try to provide the right tax and regulatory incentives to get higher paying employers to move jobs into their community or to get local employers to expand.
Initially, incentives may bring in some needed jobs, but they would also attract workers from other areas. The local population would increase, and the unemployment rate would start going back up. Then, this community would need to attract even more new jobs. At the same time, other communities would be trying to entice this community’s employers to move jobs into their area. Some businesses may benefit from all the tax incentives, but the result would just be to shuffle jobs around while reducing tax revenues.
Although some of us will just work to earn enough money so that we can enjoy the other aspects of life, most of us want more from our jobs. The specific work goals of one of us may differ significantly from those of another, but there are some general goals that most of us have. To some extent, we all want to enjoy our work, to be recognized for our contribution, and to earn the most money for the least amount of work. Of course, the best jobs are generally the ones that take a lot of work to get or that have a lot of others competing for them, so we will often have to make compromises.
One of the goals of society should be to ensure that all of us can get a job that will earn us a living wage. No one who can work should need to depend on the charity of others or to resort to crime. This would not only give us control of our own life, but it would greatly reduce the burden on the others in society who would have had to support the unemployed and the underemployed. In addition, since all of us would know we could earn a living, crime would go down and the economy would gain some stability. This would also mean that most of us could work a little less and still end up having the same, or an even better, standard of living than we had before.
Besides ensuring that we all could get a job we would also have the goal of ensuring that we all do our fair share of the work. This means that we would be fired for not doing our jobs or not working hard enough at our jobs. We should not be allowed to freeload off society, which would make life harder for everyone else. This would also mean that society would need to have the courage to expel us to someplace where we would have a chance to change our ways without being a burden on others.
Society also needs to keep us employed and working even in the toughest of economic times. An important factor in the building of wealth is the value that is added by us doing work. By keeping us working in productive endeavors, our labor would not be wasted, and our wealth would continue to grow. Of course, by keeping us working, society could not only shorten any bad economic times, but could even avoid them.
Another goal of both us and society would be the creation of wealth. Although some of our wealth comes from simply having control over some resource that is in demand, true wealth springs from finding and using the most productive work methods to meet the needs and wants of society and its citizens. In that light, society must ensure that we are doing work that is productive and that contributes to the wealth and betterment of society and its citizens, and that we would be rewarded for our creativity and risk taking.
There is no way to make any of us work, but we can do whatever we can to make it easier for us to learn the needed skills, and to find and to get work. Those of us who are willing and able to work should have the opportunity to work. On the other hand, those of us who want to freeload off others should not be allowed to become a burden on society.
No one person or group could ever guarantee full employment, but businesses, workers, and governments could each make their contributions. Businesses could allow the largest number possible of us to work for them locally. We could learn the skills that are needed by employers and could be as productive as we possibly can be. Governments could create the tax and regulatory laws needed to encourage local employment. Separately, none of these actions would ensure full employment, but together these and some other actions would combine to create the conditions that could lead to what would essentially be full employment.
The following are a few of the things that could be done to make the employment picture better for us all. These would include things such as spreading out the workload, convert benefits to wages, having employees work a flexible number of hours, reducing our cost of living, keeping jobs local, learning needed skills, paying appropriate compensation, balancing the mix of local employment, continuing government services, and having a pool of standby work. As needed, the appropriate Moderated local, state, or federal government would need to change the tax and regulatory laws to encourage the adoption of these changes.
There is nothing set in stone that says that we need to work 40 hours, or any specific number of hours, per week. If we divided the amount of work that needs to be done today by the number of individuals who can work today, we might likely come up with something far less than 40 hours per week. With continued productivity gains, the average number of hours that we would need to work per week should decrease further. If we continue to have most of us work 40 hours per week, we are going to have even more unemployment.
Therefore, to eliminate unemployment, we need to reduce the number of hours we work and to spread the work to everyone. Of course, all work is not the same and everyone does not have the same skills or abilities, so dividing up the work would be a little more complicated than just having all the available workers work the same needed average number of hours per week.
Different jobs require different levels of education, training and effort, and, in turn, offer different levels of pay. One of us who puts in all the money, effort and time required to go to college or to trade school would normally want and should normally expect a higher salary than someone who did not get the additional education. Then, if we end up doing the job that we put all our effort into getting, then we should usually get the appropriate higher salary.
On the other hand, some of us may prefer or may need to jump right into work, even if we need to settle for a lower paying job. Of course, a related but different issue would be to ensure that we all had the opportunity, if we so desired, to get the education needed to get a better job. I will talk more about this in an upcoming section on Education.
To earn enough to pay for the same necessities, those of us working at a lower hourly rate would need to work more hours than those of us working at a higher hourly rate. Therefore, in general, those of us making a higher hourly rate should be able to earn enough by working fewer hours per week. Of course, those of us getting a higher hourly rate are not necessarily getting off easier, since we may need to put in long hours of studying, training and preparation outside of work to get and to keep our higher paying jobs.
The bottom line should still be that those of us who have invested in and are continuing to invest in more education and training should still earn more and be able to have a higher standard of living than those of us who do not make the same investment. We just need to make sure that we do not work too many hours, so that we will leave enough work for others to be able to earn a living. An added benefit for us is that we would have more time for family, friends and other interests that could make our lives more worthwhile and keep us from burning out on the job.
Let’s say that a company needs 160 hours of a particular type of work done each week. Instead of hiring 4 workers that would each work 40 hours per week, they could hire 5 workers who would work just 32 hours per week. For the employees, one person would now have a job and the others would have more time off and less stress. Of course, their gross pay and benefits may be less, but they would not have to pay as much in taxes, since the government would not need to help support those individuals who would have otherwise been unemployed.
To make this work, employers would need to make one very important change in the way they compensate their employees. Today, full time employees often get many benefits in addition to their salary. For instance, their employer may provide health insurance, a pension or some other benefits. This could make it more expensive for an employer to spread the work between 5 employees rather than between just 4 employees.
Therefore, employers would need to switch to paying their employees at a higher hourly rate and to eliminate the company provided benefits. Employees would then use their higher salaries to purchase the benefits that they decided they needed or wanted, which may not be the same benefits that the employer would have provided. See more about this in the “Convert Benefits to Wages” topic below.
By staggering their employee’s work schedules, the employer could still have just 4 workers there at any given time, and still have coverage over the same hours of the day. This would also mean that the employer could still have just 4 workstations, so they wouldn’t have much added overhead, but they would now have another person to help contribute their ideas and expertise. In addition, if someone was sick, went on vacation or left the company for another job or for retirement, the other workers would be able to more easily pick up the slack until they were fully staffed again, and do so with far less chance of burning out from the extra work.
This could work even better for some upper management positions or professions where long hours are sometimes the norm. Let’s say a company had a CEO making a million dollars or more a year while working 80 hours per week. You could easily split that job between three people, each making a quarter million or less a year while only working 30 hours per week.
Spreading out the work of a single CEO could benefit everyone involved. For the new co-CEOs, two individuals would now have good paying jobs, and no one would be overworked or stressed out. The company would not only save money but would get three individuals contributing their ideas and expertise. In addition, multiple CEOs would provide extra checks and balances to keep the company on track and would provide needed backup in case one of them was sick or left the company.
In addition to an employee’s base wage or salary, a business or government will usually provide some additional benefits such as life insurance, health insurance, sick leave, vacation time, and maybe a pension plan. In general, if an employee is a full-time employee, then he or she will be eligible for and will get a full package of benefits, which may be tied in some way to the employee’s salary and marital status.
At a large company these additional costs may add up to something in the range of 25 to 40 percent of a full-time employee’s base pay. A small company may provide some, but fewer benefits, or no benefits at all. Part-time employees most likely would not get any benefits at all. With the wide range of the amounts and types of benefits that an employee can get at different companies, it can be particularly difficult to compare what someone might get in total compensation at different companies.
The amount and way benefits are provided can make a significant impact on the decisions a company makes when considering how many hours they require their employees to work and whether they will hire additional workers or not. Even when employees get time and a half for working overtime, it may still be cheaper for a company to have their employees work overtime rather than hire a new employee who would also be eligible for benefits. In the case of exempt employees, a company would have even more incentive to have their employees work long hours, since they might not even get paid for the extra hours.
Therefore, with the way benefits are currently provided by most companies, those companies will usually gravitate towards having their full-time employees regularly work a 40-hour week with some overtime instead of having them work fewer hours and hiring some additional workers. This in turn contributes to keeping the unemployment rate higher than it would be otherwise.
Another problem is that a company may provide some benefits that many of their employees do not need or want while not providing the ones that their employees might prefer getting. In some cases, the company still must pay for these benefits, even when not used, which can be a waste. In other cases, the company may be able to save some money when their employees do not take advantage of the benefits that they are offered.
It can also be particularly difficult for a job seeker to compare compensation packages when there are big differences in the type, quantity and quality of the benefits offered by different companies. Therefore, when deciding what company to work for, many workers may base their decision mainly on the wages or salary being offered without fully considering the accompanying benefits.
One important benefit for many workers is health insurance. When it is offered, an employer will usually offer only a very limited number of options. This is the case even though the right health care can be very important. Married couples may have a few additional health insurance options, because they may be able to choose between the options offered at both the husband’s and the wife’s companies. Of course, if coverage is taken at one company, the other spouse will lose out on some benefits at his or her company, while that company may end up saving some money.
The answer to all these problems is to get companies out of the business of providing benefits. Instead, companies should provide an appropriately higher wage or salary and allow their employees to choose and to pay for their own “benefits”. At first, companies might simply offer a choice between switching to a higher wage or salary, or keeping the company provided benefits. Eventually, most companies would hopefully get out of the business of providing benefits and everyone could then choose and pay for the exact coverage and types of things (benefits) that they wanted.
Appropriate changes would need to be made to our Income Tax laws so that employees would end up paying the same income taxes whether they took the higher wage or salary or continued to get the company sponsored benefits. The simplest way to do this would be to tax the amount of benefits being provided in the same manner as their regular income. Our tax rates could then be adjusted to keep total income taxes about the same as they were before. The biggest beneficiaries of this change would be those workers who were getting little or no benefits, either because employers would need to pay them more, or because they would end up paying lower income taxes.
With employees getting higher wages and no benefits, it would be cheaper for many more companies to employ more workers instead of paying a lot of overtime. Job seekers would find it easier to compare different compensation packages. In addition, the increased competition from many companies offering services that are meant to replace the benefits that were previously provided by the company, could lower the costs of purchasing the things that were offered as benefits.
Instead of hiring a worker to put in a fixed number of hours per week, a company could hire a worker for a flexible number of hours per week. For instance, a worker could be hired to work each week from 25 to 35 hours, from 30 to 40 hours or maybe even from 35 to 45 hours. Over the course of a year, the company’s goal might be to have each worker average 30, 35 or 40 hours per week, but each week could vary depending on workload and employment levels. Of course, workers would only be guaranteed the lower number of hours per week.
If a company lost a worker or the workload increased, then the appropriate workers could work longer hours until things slowed down or a new worker was hired. If the workload decreased, then the appropriate workers could work shorter hours until the workload increased. or a worker was let go.
In both cases, the employment base would be stabilized. In the first case, the company would not need to hire workers until they knew they would be needed for the long term. In the second case, the company would not need to lay off valuable employees until they knew that they had no other choice.
For those of us who would have lost our jobs in an economic downturn, the benefits would be enormous. We might just need to cut back on some luxuries instead of being unemployed and possibly using up our savings and then going bankrupt. Those of us who would have kept our jobs might have to cut back on some luxuries too, but we would still benefit from less worry about losing our jobs, and we would already be paying fewer taxes to support those of us who would have been unemployed. In addition, we would have a little more time off to prepare in case we did end up eventually being laid off.
In the future, with continued productivity gains, we might work as many hours as before, but we could still end up earning a higher salary. With flexible hours, we would stay employed. Of course, we will need more education to learn the things needed to continue making productivity gains, but by working fewer hours on the job, we will have the time needed to invest in the additional education.
With increased flexibility in the number of hours we work, more jobs may lend themselves to the use of part-time or substitute workers. In both cases, these types of workers could help a company better manage their work force to meet their labor needs. If a company needed more work done, but not enough to hire someone full time, they could bring someone on part time. If someone is out sick and their job lends itself to it, the company could also have some substitute workers that could come in as needed.
Some employers are currently experimenting with a 4-day workweek. Workers would only work 4 8-hour workdays instead of 5 8-hour workdays, which means they would only work 32 hours a week instead of 40. However, they would need to do the same amount of work in those 32 hours, but they would get paid the same as when they worked 40 hours.
Experiments have shown that most workers are able to adjust to this new schedule and like it. Workers find that they have less stress with an extra day off which allows them to be more productive so that they can get all their work done in just 4 days. Not only are workers happy, but employers are happy that they can get the same amount of work done for the same cost.
Although a 4-day workweek works for many works, it does not work for all workers. For some jobs, workers are at least partially paid based on the number of hours they work. For instance, a receptionist may be paid to cover a front desk. If a receptionist only works 4 days instead of 5, the employer will still need to pay someone to work on the fifth day. In this and similar cases, the worker may need to earn less, or the employer will need to accept a higher cost for these workers.
When these 4-day workweeks work as expected, the workers will be happier, but we do not spread out the work. However, an employer can save money by staggering employee workdays so that they can get by with fewer workstations by having employees share. On the other hand, employers could hire more workers without needing to add more workstations. Either way, employers could reduce costs and either make more profit or lower prices for their products or services.
Full-time employees will usually get some combination of holidays, vacation days, personal days and sick days. In the case of holidays, vacations and personal days, these are usually factored into our salary or wages. That is, our salaries or hourly wages are a little lower so that we can be paid for our time off. This evens out our weekly or monthly earnings, without costing the employer more than if they just paid us for the time we worked. If there are separate sick days, then those are usually extra. Although, an employer will need to estimate how many may be used and factor that into the salaries and wages of all their employees.
In the case of holidays, this time off is already planned out for the year, so they do not cause any unexpected disruptions. Vacation days usually must be approved ahead of time so that an employer can plan accordingly. Although some personal days may be planned, they are mostly meant for use when something unexpected comes up. When we get sick, our personal days or sick days are usually never planned. Having flexible work schedules can be very helpful in the case of unexpected days off.
When an employee calls in sick, one of two things could be true. If the employee is sick, then the employee should take the day off, or the employer should insist the employee take the day off. If the employee is not sick and just wants a personal day, then the employee should just say they need to take a personal day. If the employee is not sick and is taking a sick day, then that is wrong, since that would cost the company a day's labor.
I do not see any good coming from a company offering separate sick days. Not only would employees who get sick a lot and those who abuse the sick days cost the employer more, but those employees would, in addition, be rewarded for being sick or for lying. Employees should instead be given a fixed number of personal days that they can use. Then, if needed, they could use vacation time or take unpaid time off.
If an employee does not have any sick days, personal days or vacation days left, or just does not want to use one, the employee may come to work sick. Then, that sick employee might not be as productive and could end up spreading this sickness to other employees. Given the costs, an employer would want to do all it could to keep sick employees out of the workplace.
If an employee could work from home, then the employer should make that an option and then that is what the employee could do, if well enough. If a sick employee comes to work and it is obvious, then the employer should send the employee home so other employees are not exposed and write up the employee for coming in sick. The tricky part is when an employee does not show any obvious sign of being sick and may not even realize it. However, if any sign of being sick shows up later in the day, then the employee should be sent home.
If an employer uses flexible work hours, then the employer should have procedures in place to allow employees to make up any sick time. If for some reason it is not possible to make up the time and the employee did not have any more time off, then the employee would simply have to lose the pay or might have had insurance to cover something like this.
How does reducing our cost-of-living help to keep us employed? First, it reduces the amount of work that we would need to do to earn a living wage, which would help to spread out the work. In addition, it leaves us with more time and money to spend on additional goods and services, which would require more labor to produce.
There are many ways for us to reduce our cost of living. These will generally fall into a couple of broad categories. In the first case, we can cut back on expenses by buying less or finding less expensive substitutes for what we do buy. In the other case, we find ways to reduce the cost of producing things and to eliminate things that are not needed. Here, we want to concentrate on the second case, because we want to be able to live better for less, without needing to sacrifice.
One important thing to do is to reduce our overpopulation. This will reduce the excess demand for our limited resources, which will reduce the cost of those resources and ensure that we will have enough of them. We must also eliminate waste. I have mentioned some ways to reduce waste in previous topics and will talk about some more in some upcoming topics. In addition, we must work on increasing productivity.
The ideal situation would be to get to the point where all costs could be easily boiled down directly to just labor costs. To do that, we would need to do and to have a few things. We would need to use only renewable resources. We would need to have enough resources for all of us. We would need to recycle and to reuse all our resources without producing any waste. With continued productivity gains, we could work less in the future and still have a better lifestyle than our ancestors did.
Any given community wants its citizens to be able to get and to keep good paying jobs. Employed workers would help to stimulate the local economy, while unemployed workers would be a drain on a community’s finances. Employed local workers would pay local taxes and patronize local businesses. There are also numerous benefits to the community and to the local businesses by having local workers work locally. With more local workers working locally, there would also be less commuting, which would reduce the need for the community to build and to maintain so many roads.
One way to encourage the local employment of local workers would be to provide the right tax incentives. If employers can pay lower payroll taxes on local workers, then they would be encouraged to hire and to keep local workers, and to even encourage non-local workers to move nearby. Of course, the best way for this to work would be to provide tax incentives based on how close someone lives to their employer. We want to make it equally fair to the businesses located near the center of a community and to those located on its outskirts. For instance, a business hiring someone who was within walking distance would not have to worry that the worker lived in a different community.
A community should also try to hire local businesses to do work for the community. Of course, a community wants to get a job done for the least amount of money, but it needs to consider more than just the contract amount. The community also needs to consider the employment and tax benefits of hiring a local business to do the work instead of a non-local business.
If employing a local business would reduce the unemployment rate and generate tax revenue, then those benefits should be included when considering which business to award the work to. For instance, if the direct cost of hiring a local business would cost thousands more than an equally qualified non-local business, but the indirect benefits add up to more than the higher direct costs, then the local business should still get the work.
An important factor in someone being able to get a higher paying job is having the right combination of skills and experience. Each year, we continue to have many high paying jobs go unfilled or to be outsourced because businesses cannot find enough individuals capable of doing the work. In addition, for each skilled job that goes unfilled or that is outsourced, some number of other related jobs, for which there are unemployed workers capable of doing the work, end up not being filled or end up being outsourced as well.
Our local governments should track what skills are needed by businesses and roll that information up to the state and federal levels. This information should then be made available so that schools can use it to determine what courses they need to offer to teach the required skills, and so that individuals can use the information to help them determine what skills they should learn to help them get one of these high paying jobs. Our governments and businesses could also help defray the cost of these courses so that students looking to land one of these unfilled jobs could more easily get the required education.
If we spread the work and had more flexible work hours as I proposed above, then even workers who are already employed could have more time to go back to school to learn the additional skills needed to move up to a better job. In addition, businesses could encourage and help some of their existing employees to learn the needed skills and to get some on the job experience. This could include helping them pay for classes and giving them paid time off to take some classes and having them help with some of the work that needs the skills that they are learning.
We currently have some minimum wage laws and there has been some talk of imposing some kind of maximum wage. In a free society, imposing any type of minimum or maximum wage does not make sense. Yes, we want everyone to be able to earn a living wage, but, if there is unemployment, a minimum wage only helps some less skilled workers who already happen to have jobs. Setting a maximum wage is even more problematic, since, if it is set too low, it could stifle the drive of our most ambitious workers.
Instead of a minimum wage we should let the market dictate what workers are paid. Once we have or even get close to having full employment, the law of supply and demand will kick in and companies will have to pay a fair wage to get and to keep good workers. This would also reduce or eliminate the need for union contracts that force companies to pay specified wages and benefits. As we get to full employment, more companies will need to pay their workers a fair wage and will need to base their pay more closely on their workers’ performance.
As for a maximum wage, you would think that there would already be plenty of financial incentives to keep wages down. Unfortunately, the upper management and board of directors of many companies have too much power and most stockholders do not have enough clout. Those in power control the purse strings and their greed can get the better of them, which results in some CEOs earning tens or even hundreds of millions of dollars per year. Even at 40 hours per week for 50 weeks a year, a million-dollar salary comes out to 500 dollars per hour. Except under some extraordinary circumstances, I cannot see an average CEO being worth more than that amount for just doing his or her job. A four-pronged approach is needed to get this situation under control.
I have already mentioned the first part of this approach. In many cases, top level executives receive a large part of their compensation in the form of benefits, which can help to hide the true cost of their employment. All employees should simply receive an appropriate salary that takes into consideration an amount that they would use to purchase or to invest in their own benefit plan. By paying all compensation in the form of a salary, it becomes easier to compare what companies are paying, and will help with the next two parts of this approach.
I also touched upon the second part of this approach. We need to spread the work of upper management to more individuals. The biggest justification for large compensation is the competition to hire the few individuals with all the skills needed to manage a big company. Another justification is the long hours that must be put in by those in upper management. The answer in both cases is the same. Hire two or three individuals who together have all the needed skills and have them work fewer hours at more reasonable salaries. Not only would the company save money, but multiple workers could do the job as good as or even better than one person working longer hours. Granted, many individuals in upper management are workaholics who want to work long hours, but we shouldn’t be encouraging this excessive and greedy behavior.
The third part of this approach would be to give stockholders more power. The stockholders own the company, and they deserve the right to decide who gets the profits it generates. We should require all companies that are incorporated in or that operate in the United States to get the approval of their stockholders before they can compensate anyone more than some maximum amount per year. This maximum could be based on some multiple of what the lowest paid employee makes. With stockholders being more aware of what their top executives earn, they can better control their company’s finances. Of course, if a top executive or any employee contributes something above and beyond his or her normal duties, then that contribution needs to be rewarded with an appropriate approved bonus.
The final part of this approach would be to tax income that exceeds some extremely high amount at a higher rate. Once someone is making enough to be not only comfortable, but to buy or to do just about anything except for the most extravagant things, then anything over that is just plain excess. By imposing a tax instead of a limit, we will not be preventing individuals from earning extremely high salaries if they can. It would just make it a little harder for them to reach an extreme level of excess. On the other hand, some exception should be made when someone earns a large sum by doing something extraordinary.
With the right balance of employment opportunities, it is easier to keep us employed in difficult economic times. As I talked about in the section on labor, we want to produce locally a good mix of the necessities and the luxuries that are consumed locally. In this way, our consumption of goods and services would help to keep our neighbors employed, and their consumption of goods and services would help to keep us employed.
There are some things that we will always need, even in the worst of economic times. Those of us who work in jobs that produce these goods or provide these services will have more job security than others working to produce or to provide other things. For those of us who work to produce other goods or provide other services, our jobs may not be as secure. Therefore, we need to be ready to move into other jobs when the economy takes a downturn.
Our local government can help to balance this employment picture by providing the right tax incentives and assistance to encourage local businesses to produce the things that their community’s citizens need and want. We would need to determine the amount of lost tax revenue and the amount spent on unemployment when companies do not employ local workers to do things locally. Then, something up to this amount could be provided as an incentive to make things locally, and we would still make out better than not having these jobs.
Our federal government can also help by making importers pay to support the cost of imports. Goods coming into this country should be thoroughly inspected to prevent the smuggling of illegal, fake and dangerous items. Currently, our inspectors do not have enough personnel or money to inspect more than a small sampling of what passes through our borders. We need to determine what it would cost to inspect these trucks and containers and to add an appropriate amount to our import fees to cover those costs. Not only will this provide the needed money to inspect all our imports and provide the resulting improvement in security, but it would also raise the cost of imported goods, so that locally produced goods would be more competitive.
Another thing that our federal government needs to do is to apply appropriate levies on imported goods that were manufactured without meeting our labor, safety and pollution standards, and without paying some appropriate taxes. We should not be giving foreign manufactures an advantage in the U.S. market just because they did not have to incur the same costs needed to meet our standards. Not only would this help to make U.S. made goods and services more competitive, at least here, but we could stop rewarding those companies who make goods in or provide services from a foreign country where they can do so cheaper by polluting the environment and by endangering lives. Therefore, this would also help us to ensure that we are upholding our values whether the goods and services we buy are made or provided here or someplace else.
In troubled economic times, local, state and federal government services are often cut to balance the budget. This just makes things worse by adding to the unemployment rolls and making it harder for us to get the government services we need. It also slows the local economy even further, which reduces tax revenues further and makes balancing the budget even harder.
If we lay off firefighters, we end up with higher losses from fires. If we lay off paramedics, more of us could die before help arrives. If we lay off teachers, more students do not get the education they need to become the skilled workers that the economy needs to get us back on track. If we lay off police, more crimes will go unsolved. In fact, hard economic times could cause more individuals to turn to crime to get by, so even more police would really be needed to handle the rising crime rate and to keep us safe.
Each government entity needs to maintain its service level by balancing its budget over many years. In other words, it should determine what level of service is needed and make sure that, in the long term, taxes will bring in enough to pay for these services. In good economic times, the government should put the extra tax money into a rainy-day fund. In bad economic times, the government would use this rainy-day fund to keep service levels stable until things improve.
This will not only keep us safer and not deprive us of needed services, but it will also help to keep our economy from getting any worse than it needs to be. In essence, this would provide a built-in economic stimulus package that would be better than anything done after the fact. The reason for this is simple. We would know that the government services will be there, and that our government will not make cuts that would accelerate our economic downturn just when our economy needs the most help. This will help give us the confidence needed to help with the recovery.
Another thing that can be done to keep government services going is to have our unemployed workers help us out. Unemployed workers will need more government assistance and will not be paying as much in taxes. This means an increase in the work needed to provide services, but a decrease in the funds needed to provide them. In exchange for the additional needed government assistance, we could require that these unemployed workers pay back some of this extra assistance with some of their labor.
Even with everything being done to spread out the work and to stabilize the employment picture, there will always be some individuals who will still end up losing their job and having a hard time finding a new one. In some cases, a worker may not have been doing a good job but will often be laid off for something not under their control. For instance, their company was not able to compete, there was an economic downturn in their specific business or in the regional or global economy or the company made such good productivity gains that it did not need as many workers.
Whether it is due to bad luck or timing, or due to some other reason, some of us may not be able to find new work before our unemployment benefits run out. We and our families could then risk losing our life savings, our homes and our dignity. Instead of losing everything and becoming a burden on society, why not give us some temporary work that will allow us to make a productive contribution to society and to earn enough income to keep us going. Of course, we may not make as much as we did in our previous work, but the goal would be simply to help us to bridge the gap until we can find a new permanent position.
In some cases, it may be beneficial to allow some of us still getting unemployment benefits to take some temporary work without risking the loss of our benefits. We could simply put our unemployment benefits on hold during the time we held an approved temporary job. If we still had not found full-time work, our unemployment benefits would simply resume when our temporary work ended. The idea is that the temporary work could give some of us the extra time needed to find full-time employment before our benefits run out.
There are a couple of different types of temporary work that could be used to help the unemployed. In both cases, the work could come from our local, state or federal government, or from some private business. In addition, there would be appropriate incentives in place so that preference would be given to qualified unemployed workers over workers who were already employed.
In the first case, there may be work that needs to be done and is planned to be done, but there is no rush to get it done right away. Therefore, the employer could hold off having the work done in case there are unemployed workers who need the work and who would be given preference when hiring someone to do the work. If there are no unemployed workers who need the work after some time, the employer could then hire other workers who may wish to supplement their income by doing some temporary work.
In the second case, there may be some work that would be of some value to have done, but it might not be worthwhile doing for what it would normally cost to hire someone to do it. If we had a pool of unemployed workers whose need for public assistance would be taking a bite out of our tax dollars and whose labor would otherwise be going to waste, then we may have a cost-effective way of getting the work done. Since some of the cost of the labor would have been going towards assistance anyway, putting these unemployed workers to work could cost less, so it might now be cost effective to have the work done.
This work could span a wide spectrum of activities such as cleaning parks and streams, recycling, painting government buildings, taking inventories, conducting surveys or audits, doing research, or helping wherever needed. It may also include doing work ahead of time to help prepare for what may come. The pay might be lower than it would be for doing other work, but it would be better than welfare and the work hours could be made flexible enough to allow these temporary workers the time needed to interview for permanent work or to learn new skills.
In addition to the above temporary work that could wait for available unemployed workers to do the work, we could also provide incentives to hire any available unemployed workers to do seasonal work. This work could include helping during the holiday rush, planting or harvesting crops, or working at a ski resort in the winter or a park in the summer.
To prevent individuals from moving into a given area just to take advantage of this temporary work, there would need to be citizenship and residency requirements that would need to be met. For instance, someone might need to be a U.S. citizen and to have lived in the appropriate jurisdiction for at least 3 or maybe 6 months. There should also be a time limit on how long someone would be allowed to hold one of these temporary jobs. Three months might be a good starting limit, but there should be some flexibility based on economic conditions, the current demand for an individual’s skills, and other factors.
We would also need to treat these temporary jobs like any other employment. We would need to show up and do the work or risk being fired. Given the short time that most of us would be on the temporary jobs, performance reviews should probably be limited to some limited number of performance levels like maybe just satisfactory or unsatisfactory.
Another use of these temporary jobs might be to help young individuals who are just starting out, who do not have any previous employment history, and who could use some on-the-job experience. In addition to the other requirements, we may want these younger individuals to be at least 18 and to have at least a high school diploma.
For some of us, another factor preventing us from working is a lack of affordable childcare. The federal definition of affordable childcare is 7% or less of annual household income. With childcare averaging about $15,000 a year in 2022, that means household income would need to be more than $214,000 a year. This means that affordable childcare would only be available to a small percentage of households. In fact, some low-income single parent households may only make about $30,000 a year, so without some sort of subsidized childcare, it could cost them half their income.
One way to help fix this situation would be to have community sponsored childcare. These community childcare centers could be included in, attached to or adjacent to the schools. Using the school staff would save on some of the administrative costs. In some cases, the childcare could be free, but it may be best to charge a fee equal to some percentage of household income up to some maximum amount.
For smaller children, a parent could drop off a child on the way to work and pick up the child after work. For school age children, I child may take a bus to school, walk to childcare after school, and then be picked up when the parent gets off work. Older children might even be able to help take care of younger children as part of a work program.
For those parents who can afford and who prefer private day care, then they would still have that option. For those who need community childcare, they would be able to go to work without being forced into poverty due to high childcare costs.
If the above proposed changes were implemented, the level of unemployment would be reduced. Even if the net result of these changes resulted in the same GDP, there would still be benefits for all of us. Lower taxes would allow us who had a job to have about the same amount of take-home pay while now having more time off. Those of us who would have been unemployed would now have a job and would be able to enjoy a more comfortable lifestyle.
Of course, these changes should stimulate the economy. With everyone employed and everyone more confident of keeping their jobs, and with more of us having more free time, more of us could buy more and do more things. In addition to allowing some of us to go out more and to spend a little more, others of us may be able use some of our additional free time to learn new skills or to work towards getting an even better job. The combination of more economic activity and a more skilled workforce would further help to grow the economy.
Education -
Providing everyone a good education in order to keep our economy strong.
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