Income Inequality

[SuburbanFarmer]

I think that it is an issue without an easy solution. It's complicated.

The tech revolution completely changed the relationship between pay and productivity. Just because I can now do things on a computer in 1/100th the time it used to take my using paper and pencil doesn't mean I should now get paid 100x as much.

Yes, it absolutely does mean that. Productivity is the measure of Revenue generated per employee. Your employer is gaining 100x the amount of revenue from your work, yet you are being paid the same. If there's no connection between that, then why bother learning new skills? This is why we have 'skill inflation' - you have to be MUCH more learned to fulfill the same function, for the same pay, as what your father did. Not only that, but you're taking on DEBT to get that learning.

Productivity is not the measure of revenue generated. My getting something done 100x faster <> employer gaining 100x the revenue. Making burgers at twice the pace does not equal twice the numbers of burgers sold.

I learn new skills to ensure that I am a valuable asset to an employer. Being a valuable asset to an employer will usually get you an increase in salary. If not, and you feel you are worth more, then use those skills to get a new job that will pay you more. Being more learned than our fathers is another non-equivalency. A lot of our fathers held down jobs that don't exist anymore, so there is no "same function". Not to mention there is no way you're not making more than they did for the same function.

You're grasping.

No, there's not a 1:1 relationship between speed of execution and revenue, that's why we have the Productivity metric. Revenue/Employee.

Every time I make a report, or even have a short email conversation, I'm doing the work of several-to-many people a generation ago. The resources required to run a modern database on paper would be absolutely staggering. Most modern corporations could not even exist without Egyptian-pharaoh levels of labor.

Yet we make very nearly the same wages per hour worked - why do you think they pay by the hour? Wouldn't piece-work make more sense?

Because even a mid-level office drone is operating at the equivalent of hundreds of his kind just a short time ago. Where do you suppose all the money went that paid that staff?

As far as the learning vs. last gen, I wasn't referring to actual education. i meant the amount of raw knowledge and skill needed to operate as a modern employee vs. then. No matter what you do for a living, you are tracking at least 10x the number of things happening that your father had to, and communicating at light-speed with your coworkers, no matter where they're located. That's not making more for the employer?

[PartyOf5]

You're grasping.

You wish.

No, there's not a 1:1 relationship between speed of execution and revenue, that's why we have the Productivity metric. Revenue/Employee.

I'll agree with you that there is not a 1:1 relationship. The productivity metric may measure revenue/employee in a very general way for a company as a whole, but it does not tell you how valuable any individual employee is or how much that employee contributed to the revenue.

Every time I make a report, or even have a short email conversation, I'm doing the work of several-to-many people a generation ago. The resources required to run a modern database on paper would be absolutely staggering. Most modern corporations could not even exist without Egyptian-pharaoh levels of labor.

Yet we make very nearly the same wages per hour worked - why do you think they pay by the hour? Wouldn't piece-work make more sense?

This is where it gets complicated. A generation ago US workers weren't competing for jobs globally like they are today. You need to be more productive today in order to keep your job. Piece work doesn't work most jobs. For those that it does, piece-work can result in lower quality.

Because even a mid-level office drone is operating at the equivalent of hundreds of his kind just a short time ago. Where do you suppose all the money went that paid that staff?

The money went to pay for all the database administrators, website developers, and other IT jobs that didn't exist a generation ago.

As far as the learning vs. last gen, I wasn't referring to actual education. i meant the amount of raw knowledge and skill needed to operate as a modern employee vs. then. No matter what you do for a living, you are tracking at least 10x the number of things happening that your father had to, and communicating at light-speed with your coworkers, no matter where they're located. That's not making more for the employer?

A lot of the light-speed communication is a waste of energy. Activity <> Productivity.

[SuburbanFarmer]

No, there's not a 1:1 relationship between speed of execution and revenue, that's why we have the Productivity metric. Revenue/Employee.

I'll agree with you that there is not a 1:1 relationship. The productivity metric may measure revenue/employee in a very general way for a company as a whole, but it does not tell you how valuable any individual employee is or how much that employee contributed to the revenue.

... So companies are just magically more profitable with fewer employees? No. Companies are made up of people. Money/People is the metric for how effective that company is at generating revenue.

Yet we make very nearly the same wages per hour worked - why do you think they pay by the hour? Wouldn't piece-work make more sense?

This is where it gets complicated. A generation ago US workers weren't competing for jobs globally like they are today. You need to be more productive today in order to keep your job. Piece work doesn't work most jobs. For those that it does, piece-work can result in lower quality.

The need to be more productive is not a cause - it's an effect of exactly what I'm talking about.

Because even a mid-level office drone is operating at the equivalent of hundreds of his kind just a short time ago. Where do you suppose all the money went that paid that staff?

The money went to pay for all the database administrators, website developers, and other IT jobs that didn't exist a generation ago.
.

A generation ago, that would have been an army of researchers, graphic artists, phone operators, and mathematicians.

[Martin Hash]

There's no way to look at specifics & come to a general solution of dangerously increasing wealth inequality. This is where you need to rely on ideology. Let Emergent Order take care of the bottom & tax the top. If income has diminishing returns then that pushes opportunity down to the next tier. The top quarter of the population pull everyone else along but only 1% of them are getting the rewards now.

p.s. Those who don't fully believe their professed ideology need not apply.

[Speaker to Animals]

The bigger problem is the destruction of the middle class.

[apeman]

The bigger problem is the destruction of the middle class.

That's a good point and useful for refocusing. Not a zero sum game. Problem is, productivity has been pitiful for a while, we can't break 2% GDP for like a decade.

When growth is stagnant, everyone starts looking around and wondering who is getting the better of them.

[SuburbanFarmer]

The bigger problem is the destruction of the middle class.

That's a good point and useful for refocusing. Not a zero sum game. Problem is, productivity has been pitiful for a while, we can't break 2% GDP for like a decade.

When growth is stagnant, everyone starts looking around and wondering who is getting the better of them.

As we crest the top of the rocket-ride in productivity, thanks to innovation, one can expect the gains in productivity to be slowing.

How long do we need to wait for the rocket-ride in wages to start? Or do we start blaming the greedy workers for demanding a slice of the boon?

This is not a cyclical event - it's a once-in-many-generations event. Just as the Robber Barons followed the Industrial Revolution, our new overlords are settling in until the working public wakes up to what happened.

[jbird4049]

The bigger problem is the destruction of the middle class.

That's a good point and useful for refocusing. Not a zero sum game. Problem is, productivity has been pitiful for a while, we can't break 2% GDP for like a decade.

When growth is stagnant, everyone starts looking around and wondering who is getting the better of them.

As we crest the top of the rocket-ride in productivity, thanks to innovation, one can expect the gains in productivity to be slowing.

How long do we need to wait for the rocket-ride in wages to start? Or do we start blaming the greedy workers for demanding a slice of the boon?

This is not a cyclical event - it's a once-in-many-generations event. Just as the Robber Barons followed the Industrial Revolution, our new overlords are settling in until the working public wakes up to what happened.

Up into the early 1970s, increasing productivity meant increasing wages for everyone. Since then almost all of the increase in wealth caused by increasing productivity have gone into upper management, and investors (like bonuses and stock buybacks). Big companies are as profitable as ever, but almost nothing goes into wages, or even investment in research, or development. It become a rentier's economy

[apeman]

^ it is true that R&D is no longer a priority, which is a terrible omen

[PartyOf5]

I'll agree with you that there is not a 1:1 relationship. The productivity metric may measure revenue/employee in a very general way for a company as a whole, but it does not tell you how valuable any individual employee is or how much that employee contributed to the revenue.

... So companies are just magically more profitable with fewer employees? No.

Where did you get that from? You must be having a different conversation in your head because it's not related to what I posted.

Because even a mid-level office drone is operating at the equivalent of hundreds of his kind just a short time ago. Where do you suppose all the money went that paid that staff?

The money went to pay for all the database administrators, website developers, and other IT jobs that didn't exist a generation ago.

A generation ago, that would have been an army of researchers, graphic artists, phone operators, and mathematicians.[/quote]
My point is that old jobs have been replaced by new ones. Yours appears to be that we've had a 99% reduction in employment due to productivity increases.