We would actually like real wages to be rising over time. Despite the thought that we live in a capitalist society, one attuned to making the plutocrats ever better off, the truth is a little different. Among all of the various things we’ve tried over the millennia this rough capitalism with free markets blend is the only thing that has managed to achieve the one desired thing. A serious, sustained and substantial rise in the living standard of the average bloke – or blokess. That’s the reason to support it and the reason why it does work was something understood by Marx. When we’ve full employment, when there’s no reserve army of the unemployed, then real wages will rise:
Amazon has raised its minimum wage for British and American workers, in a major milestone for campaigners pushing for pay increases to tackle rising levels of poverty and inequality in both countries.
More than 350,000 US workers will see the minimum wage increase to $15 (£11.57) an hour, while almost 40,000 UK workers will see their pay rise to £10.50 in London and £9.50 across the rest of the country.
Real wages, real incomes, are rising. We’ve got, in both countries, what is usually though of as full employment. Good, standard economics is working as we thought it did. Maybe late, not as fast as we’d like, but it is working.
The new pay rates start on 1 November, and will apply to all staff, full and part-time, as well as temporary and seasonal workers.
Because Amazon needs workers to exploit and expropriate from. And if everyone is already being employed by other people then they need to tempt them away from the other capitalists. And that’s pretty much it.
Swift growth in the US economy and a significant tightening in the labour market in recent months has left companies competing more aggressively to hire workers. Average hourly earnings of non-farm employees across the US hit $27.16 in August — increasing at the quickest rate in nine years, according to labour department data.
“Labour markets continued to be characterised as tight throughout the country, with most districts reporting widespread shortages,” the Federal Reserve said last month in a regular review of the US economy, adding that in “a number” of its dozen districts, retailers found shortfalls when hiring lower skilled workers.
It’s not campaigners, it’s not the legal minimum wage, it’s full employment causing this. As has been noted:
If everyone is employed then extra labour can only be gained by tempting it away from other employers – something Marx himself noted. That competition for labour is what raises wages. If there’s a huge reserve army of unemployed people competition for labour is minimal, meaning there is no incentive for employers to raise wages.
In fact, we can forget all the campaigning, abolish the minimum wage, and just try to have full employment, that’ll work just a, well, just as we can see that it does work. For full employment is the workers’ best friend.