12 November 2010

Workers are "donating" their time to bosses.

Warning, rant ahead: This is crap!  The marginal product of labour is what it is because people are working the hours they are.  (Yes, I realize the circular logic there).  If you just took all that OT off people and gave everyone else a job the net number of worked hours would actually go up, A LOT. Maybe three times in fact. (wild assertion maybe, but not unreasonable). This is because the people who are doing overtime are by their very nature, more productive than those who are unemployed.  


Suppose that it takes me "just another hour or two" to knock over that job the boss wants done, but if you had to get another person in and then your start to encounter co-ordination problems. You already employ the most efficient in society and those left over are the ones who are least able. You give my one hour task to someone less able, and suddenly it becomes 3 hours of their time, and probably a messed up job. Not to mention the wage costs sky rocket as each additional person employed constitutes fixed on-costs. 


Anyway, lets review the original article: 
  
"The executive director of the Australia Institute, Richard Dennis, argues cutting back on overtime could create about 400,000 extra jobs in Australia and improve the health of workers.
"If you could convert all of the unpaid overtime into new jobs you could create more than 1 million new jobs," he said.
"But we've estimated that if the number of hours reduced were apportioned in the same way that occurred when France reduced their hours you could create 390,000 new jobs."
Dr Dennis says people working 50 hours or more each week would happily slash 13-and-a-half hours from their workload."
The basic flaw in the argument is that if you take an hour of labour off me, and give it to someone else: 1) my wage will stay the same, and 2) it will take that person one hour to complete the task. 


That said, I agree with the general sentiment.  Australia *is* a nation of work-a-holics, despite the fact that we see ourselves as being slack an lazy.  Australia is also sees itself as a fair an equitable country, but I'm sure that anyone who isn't the "white Aussie" does not always agree.  Our self perception is often far from truth. 

Ultimately  you get paid what you are worth. If you personally punch out 30% less product, trust me, the boss will cut your pay packet by 40%. 

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