Skip to comments.Employment Laws and the Price of Labor
Posted on 12/22/2011 4:26:51 PM PST by bthockey
Many people in America believe that wages of employees are as low as they are merely because of corporate greed and that companies want to take advantage of their employees. However, most people that think rationally and for themselves dont believe this. If the leaders of America would let free markets work, companies and corporations would have to offer competitive pay for their workers to beat out competition. Government regulations and minimum wage laws are the reason why unemployment is so high in America, these problems dont occur because people on Wall Street are greedy.
The first and most important fact to remember is that a wage is simply a price paid for labor. Employers pay a price for labor much like consumers pay a price for a product in the store. Think of employees, or people searching for a job, as products sold in stores in a competitive market and think of employers as consumers trying to buy products.
The problem occurs when the government tries to set a price for labor that usually isnt worth what companies are required to pay. The labor of the employee many times isnt even close to the actual value of the labor they are paying for. (Hypothetical situation) Making employers pay $10 for someone worth $5 is much like making people pay $5 for an apple only worth $2. First of all, no matter what the employee is still worth $5. Just because companies are required to pay $10 doesnt make people worth more, it only makes the company eat the cost of the wealth that they lose when they hire that person. Secondly, think of all the jobs that business people could create with the extra $5 dollars...
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