Best way to create decent paying jobs?

Most of the focus on the recession has been unemployment. But less often discussed is the much larger group of people stuck in low paying jobs, who live in relative poverty, and have difficulty saving money because of their low incomes and high cost of housing. These people compose between 10 to 30 percent of the adults in countries such as the USA and UK.

What is the best strategy to help these people?
Should the focus be on creating more of the better-paying types of jobs, or should the wages of the lower-paying types of jobs be increased?

Or do you think that there is nothing the government can actually do because it is just moving money around from one place to another when it taxes working people to create jobs elsewhere?

Or perhaps all citizens should be paid an stipend/allowance from the government to supplement the low wages? Or should landowners and banks that hold excessive land holdings be taxed to help pay for low-income peoples rents? (because most of the cost of rent does not go to paying for the construction of the building, but rather reflects the price of the land underneath the building)

As I see it, many of the unemployed could obtain work if they wanted to but are unwilling to work in the types of jobs available for the low wages offered. Does this make these unemployed people less desserving of assistance from the government? At what point should our society not expect an individual to work hard in an unpleasant job for pathetic wages, with little to no possibility of advancement?

 

The best way to creat a job in the USA is to move overseas and do it there.

The other way is to create a way to capitalize off someone or corporation industry, by paying politicians and media big fat money to create laws that will ensure you get paid, And force the masses to pay for it. Like auto insurance, medical insurance, mortgage insurance, renters insurance.......

 

The government can't create jobs that matter. The reason is that all wealth - every nickel - is generated in the private sector. Government is a net spender of the private sector's wealth. Therefore, the jobs it creates do nothing to help the economy. The jobs that matter are those that contribute to the creation of wealth.

Business has to create the jobs. That can only happen when there is a need for additional people in businesses. It won't happen any time soon.

 

Well said .
And isn't it almost beyond belief that whilst both the US and UK paid lip service to this self evident truth , the benefits of QE ( "new" money ) in all of its guises have not gone to this area , the one in most need of help --- private sector for growth stimuli .

 

Businesses create jobs only on one condition: when consumers force them to. When they have too many orders for their goods or services to accommodate with their current manpower, then they will hire more people. So cut taxes on the masses who buy things, rather than the few rich "job creators".

 

Most of the "masses" that buy things are no longer paying taxes, but instead are recieving transfer payments and making an annual profit from Government.

Payroll taxes don't count because that is savings for retirement.

 

This is not the full position and ignores those areas which most importantly affect future extra achievements .
You have forgotten about new products/ services , innovation and genuine upgrades .
And , rightly or wrongly , you have overlooked ways in which the consumer can be manipulated , or " encouraged " , into thinking they should change purchase patterns / habits .

 

I will address your main question "What is the best strategy to help these people"


the answer is actually quite simple but the implementation, and time needed to take affect would be a few decades.

Stop feeding people ideas that they are ENTITLED to the fruits of the labor of others. Make it quite clear that if living in a single room shack is OK with you, then it's OK with everyone else that you live in the 1-room shack. You are there because you want to be. And, deciding that you wanted to slack in school, not continue your education or get a trade, make babies you can't afford etc were all your personal choices and not the fault of others.

If you want to own a 4 bedroom house, take a vacation each year and dine out, then you and only you must better yourself. it takes time, sacrifice, hard work and doesn't happen overnight.

What you do end up with is a sense of satisfaction of taking responsibility for yourself.

If you feel ill treated at work or underpaid, then start your own business and compete.

 

So then if every one decided to better themselves (as you say) how is that supposed to increase pay? We will still need garbage pick up, janitors, assembly line workers, bus drivers, and many other adult careers like these. It's just not possible for everyone to be in the 1%. I think the question is how do we raise these wages?
Recently it was announced that the median wage is $26k per year in the states. I can't see how lowering taxes on wealthy people will result in a pay increase for the employee (Many of which are not employers who sign paychecks in the first place). Labor unions however directly address the issue by allowing those with little to no power to bargain the opportunity to meaningfully demand better pay. We can't assume that the CEO's/owners of a business will "do the right thing" with thier tax breaks because it has been so obviously demonstrated that, on average, they will not.

 

If you want to increase low incomes in the US you can do this by encouraging the wealthy to invest their money in increasing the value added by employees and discouraging investment activities that do not lead to this.

A high income tax and higher capital gains tax on the wealthy with tax breaks for domestic investment in value added employment would accomplish this. Decades of lowering upper income taxes and the capital gains tax has accomplished the opposite so perhaps it is time to reverse course.

 

but, your assertion is a fallacy because not everyone wants to improve economically. Some are just happy as a clam having enough money for tonight's beer and a pack of smokes.

entry level jobs are just that and the whole push of "fair wage" has no basis unless your intent is socialism

If worker A isn't motivated to improve his own personal stock in life do you think tossing him/her more money at the same job would make them more productive? Nope, just look toward unions for your answer to that.

Some people will drive the BMW's while some will wash them, and others will steal them.

I am a big Star Trek fan but it would grate on me every time heard that "we don't use money" or "people can explore their interests"

really??????????? And this being said as they are being waited on, or having their hair cut. Do you really think people "find themselves" waiting tables or picking up trash?

The liberal utopia concept is, and will continue to be a failed social experiment. People want to compete and enjoy the fruits of their labor. In contrast, those who are complacent should not enjoy the fruits of labor of another.

 

Good post..

I think repatriating offshore profits with tax incentives would help.. and I have questions about NAFTA which I don't understand very well and the difference between Free Trade and Fair Trade.

http://www.globalenvision.org/library/15/834

 

I understand your perpective however, why not structure the game so that opportunity doesn't leave the country and move to India?

 

Is there a lack of opportunity? If so, why is it the fault of those who find more opportunity in India?

 

As said before the gov cant creat jobs that matter. If you study the effects of inflation and unemployment and the Philups curve ther is a little that can be done there by the fed. However the way the economy is now that may not have a significant impact.

I believe what we need more than anything today is an educated society which will make better decisions and allow people to get out of the dead end low paying jobs and get in jobs that have bigger impact on society. Education reform needs to take place because the system is not producing enough educated people today. Also incentives need to be created for the population to presue the higher education. The substantial government handouts and redistribution of wealth discourage people from pursuing the higher education.

 

You've gone a little astray with your theorising here! The Phillips Curve stuff (very old hat mind you as its a false debate between the bastardised keynesians and the monetarists) is about fiscal policy in general: i.e. Is it possible to choose a combination of price rises and unemployment levels, with that choice dependent on the politician's social welfare function? It can't be used to understand how the government can impact on employment rates (and hidden unemployment such as underemployment created by 'bad jobs'). We know, for example, that some countries have achieved lower employment effects through subsidisation schemes. This can of course help a country avoid hysteresis effects and the destruction of human capital

 

In the macroeconomic textbook by mankiw when discussing the phillups curve and short-run tradeoff between inflation and unemployment it states: "by changing aggregate demand the policymaker can alter output, unemployment, and rait of inflation. The policymaker can expand aggregate demand to lower unemployment and rait of inflation."

 

That's just repetition of what I said. The Phillips curve refers to the notion of demand management and somehow choosing some desired combination through that management. It is of course purely derived from economic history data. The theoretical analysis around it, from the mistaken belief that attacking the Phillips Curve was a dismissal of Keynes to the splurge from Friedman and the cretinous arguments from the New Classicals, cannot be used to understand how government can minimise the threat of economic shocks for problems such as hysteresis in unemployment.

 

So what are you trying to tell me here I understand all the economic theory but don't know what you are trying to tell me . Are you saying I am Wong in my original post about the Philups curve showing how the gov can have a short run impact or what?

You obviously know alot about economics but try and put it in simpler terms

 

I'm saying that, without appreciating it, you're applying the theory quite inappropriately. You'd need a 'monetary versus fiscal policy' discussion that is centred on a macroeconomic analysis which ignores the complexity of the labour market. Reference to a vertical phillips curve would be useless. The focus has to be on the evolution in the labour market and how human capital changes.

 

Obviously this thing goes much deeper and there needs to be a lot more said to find the real meaning and purpose however how technical do you want to get for this forum? Not many people here have the economic knowledge you or I have.

Now I will admit I didn't do alot of study on labor economics and mainly I studied international trade and finance, and public economics however I think the Philups curve is relevant and am simply pointing that out for if interested people can look at and how deep the person wants to go it is up to them. I am not going to overload them with facts though.

 

Sorry, it has zero value as I've already summarised. I'd also go as far and note that its a shame that its still taught in Econ 101. Its a bogus debate that only describes the 'opportunity costs' when it comes to macroeconomic teachers hiding from relevancy

 

Well I admit I haven't delt with the Philups curve since macroecon principals I just remembered it off the top of my head I will have to look into it more.

 

I wouldn't bother if I was you. Given the availability of useful macroeconomic thought, the opportunity costs are just not worth it. Stick to something like post-keynesianism and how that can impact on our understanding of labour market equiliibrium

 

I will look into it is there a specific work you would recomend? I like to read both sides of the argument though and make up my own mind. I have read spectums from Sowell to Krugman and although both of them are too extreme for me they both mention things worth reading.

I need to read more of the book The General Theory of Employment, Interest and Money have read parts of it but never got a full understanding of it as I moved on to study other things like international trade and finance and public economics.