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IPFS News Link • Employment & Jobs

Businesses, Employees, and the Coronavirus Crisis

• https://www.fff.org, by Jacob G. Hornberger

If it weren't for government minimum-wage laws, employers would pay their employees no more than bare subsistence wages. Socialists have also long claimed that though their acquisition of profits, employers steal what rightfully belongs to the workers, whose work has brought the employer's product into existence.

What nonsense.

As we are seeing in the coronavirus crisis, there is a commonality of interests between businesses and their employees. If a business isn't making any money, it cannot afford to keep its workers employed. When a business is bustling, the employees have job security.

Thus, it is in the interests of both employers and employees to have a dynamic, successful business. When that happens, the business prospers and so do its workers.

In fact, it is in the interests of workers to have other businesses prospering as well. That's what guarantees that the business will paying better wages to its workers. When there are all sorts of businesses doing well, they have the financial capability of paying workers more money. If businesses are going out of business, like they are during the coronavirus crisis, there is little or no competition for labor.

Even if a business owner is the most selfish person in the world, he cannot drive wages to subsistence levels if there are lots of other dynamic, successful businesses in the economy. Businesses compete for workers, which bids up the price of labor. If that selfish business owner decides not to match the going rate, he loses employees to competing firms.


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