Tuesday, July 16, 2013

Labor is not Euvoluntary: Golden Arches Edition

Buzzfeed reports on trouble in McDonaldland. Ray Kroc's company acknowledges that its line employees can't make ends meet on a minimum wage.

The BATNA for low-skilled work is always and everywhere ugly. This is an economic reality, one that can't be ignored by any amount legislative fiat. Low-skilled workers simply aren't that productive. That's what it means to be low-skilled.

The solution is to allow them to gain valuable skills. By letting them participate in the world of work. The solution is emphatically not to price them out of the market by making it prohibitively expensive to hire them and forcing firms to turn entry-level jobs over to automation.

It's true that entry-level work is not euvoluntary. All the more reason to avoid legislative meddling.

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Do you have suggestions on where we could find more examples of this phenomenon?