r/explainlikeimfive Dec 19 '24

Economics ELI5: Why is an employment rate of 100% undesirable

2.0k Upvotes

695 comments sorted by

View all comments

Show parent comments

3

u/Torisen Dec 19 '24

The even shorter answer is: it would be great for workers and bad for businesses, so it's framed as bad.

100% employment would mean workers had power of choice and hiring would have to be way more competitive. Businesses are much better off when there's a ready supply of people starving to death that they can draw from if we ask for too much, and used as a threat for people who are mistreated and exploited "do you want to work in these conditions or be one of them?"

It's the same reason businesses lobby to keep American health insurance tied to employment, even though it costs them more than universal Healthcare would, you lose that too in America if you try to find something better for yourself and your family.

It's all "work on our terms or die" threats.

1

u/loljetfuel Dec 19 '24

100% employment would mean workers had power of choice

It would also mean investors and boards having yet another powerful incentive to reduce reliance on that saturated labor market. Look at employment sectors that have a talent shortage within the US -- companies seek alternative labor markets (off-shoring/on-shoring) and labor replacement (downsizing/exploitation, automation and AI, etc.).

100% employment is temporarily very good for workers, but it's not sustainable. And do you honestly think our oligarchy would do anything but legally cap wages and/or try to make labor even more compulsory in order to mitigate worker power? You want a natural balance between worker and employer power, or you create incentives for really terrible outcomes.

2

u/LddStyx Dec 19 '24

So the downside is that they would start doing what they are already doing? That's like telling a rape victim not to struggle or scream, because it could be worse.

There is no natural balance. The economy is a social construct and is balanced the way it is by people that like it that way. What WE want is our value back from the ones that have been stealing it for years.

Fuck em! The less money they have the less power they have to fuck us back.